This dialogue occurred on Thursday, March 27, at 2:00 p.m. EDT.
Increasingly, choosing the right software and technology tools is critical to empowering procurement to realize strategic advantages. We've invited Richard Waugh, vice president, corporate development at Zycus, to talk about the company's recently released Pulse of Procurement study and to share his thoughts on technology's place in the supply chain. We'll be meeting at 2:00 p.m. EDT (11:00 a.m. PDT) on Thursday, March 27.
when we dug deeper, companies got automation benefit from spedning less time assembilng bid packages and gathering responses from suppliers, but actually chose to spend more time on the back-end using the analytics in the tools to perform multiple "what-if" anaylyses to optimize award decisions across thousands of line items
Electronics is among highest adopters and also has some of the most complexity - for example Zycus is enabling Electronics Mrfg. clients to source very large bid packages ((10K + line items and 100 suppliers) all on-line
Both procurement users and suppliers need to adopt the tools to make them as effective as possible - so they need to be extremely easy-to-use; hence the move away from ERP type systems that are hard to use and not very "open"
Richard, can you talk a little about how these solutions work? Do all of the suppliers have to adopt the solution or is the OEM committment enough? What are the concerns you hear from folks that are stopping them?
Security is a concern and the portal infrastructrue itself is highly secure - moreover, while suppleirs enter profile info self-service, approvall workflow ensures that all supplier entered data is vetted thru an approval process by the buying org and can also be supplemented with third party data verification
So best practive is for a SIM (Supplier Information ManagementP Portal that gives suppliers self-service access to maintain their profile info and certificates (insurance etc.) on behalf of the buyong org
Supply chain management is growing at a good clip. Gartner says the worldwide supply chain management (SCM) software market grew 7.1 percent to $8.3 billion in 2012. The analyst there echoes Richard: "While IT budget scrutiny and global economic conditions are moving cost reduction back to a main business driver, supply chain remains a key source of competitive advantage in driving business growth objectives," said Chad Eschinger, research vice president at Gartner. "North America and Western Europe continue to be the prime consumers of SCM software, with nearly 77 percent of market revenue. However, Western European growth slowed and Asia/Pacific continued to experience robust growth, reflecting a shift toward investment in technology in emerging-market manufacturing centers."
Many procurement organizations spend the last few years focused on cost reductions (there was a big recession after all) but are now more focused on managing the suppleir relationship and the long term supplier performance
@Richard, is it finally the death of the procurement spreadsheet? I'm amazed at how many organiations are doing things manually? What percentage of organizations do you think are still early on the adoption curve?
For top performers, 63% of procurement staff are utilizing the tools and just as importantly, these organizations have highest adoption by functional stakeholders, with alnost 50% ot the business users on-board - 2x higher than the rate of stakeholder adoption for lowest performers
That's a pretty astonishing rate. Where would you recommend organizations should start when looking at adopting or upgrading technology? WHo shold be in on the conversation? What should they be thinking about?
Our guest today is Richard Waugh, Vice President - Corporate Development, at Zycus, which makes source-to-pay solutions for purcashing. Here is his bio:
As Vice President – Corporate Development, Richard leads strategic initiatives in the areas of new product introduction, market development, thought leadership, analyst relations, and strategic partner development programs. Richard has an extensive background in B2B E-Commerce, going back to his early career at GE, where he helped launch GE'S Trading Process Network (TPN), the first on-line Marketplace for Sourcing and Procurement in the mid 1990's. He was Co-founder of B2eMarkets, one of the first SaaS (Software as a Service) Sourcing Suite providers and later covered the Supply Management market as an Industry Analyst for the Aberdeen Group. Prior to joining Zycus, he helped bring to market new innovations in P2P (Procure-to-Pay), helping global clients achieve world-class P2P system adoption and performance. Richard has a BA from Wake Forest University and is a graduate of GE's Financial Management Program (FMP) executive training.
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