Daily Archives: February 21, 2007

Sourcing 2007: Part III

David Bush of eSourcing Forum started off by predicting that optimization will gain more mainstream traction (and considering companies employing optimization with advanced sourcing techniques are still saving almost 12% per event, now more than ever you have every reason to adopt optimization), M&A activity will spike, and supply management technologies will continue to align, particularly in what David calls the triple crown: spend analysis, strategic sourcing, and contract management. I’ll go one further. I think this year you’ll start to see integration with e-Procurement systems that help buyers manage their individual buys.

Tim Minahan predicted that all of those crazy sustainable supply strategies that he’s been touting over on Supply Excellence are going to hit the mainstream. Well, I think they will at least hit best-in-class – after all, despite a few fiascos, Walmart is pushing for it – and with that clout, it’s going to happen, even if a few stumbles are made. Furthermore, Tim Minahan, Kicking and Screaming, also predicted that you will pay higher prices, you will experience a supply chain shock, you will rethink your low-cost country sourcing strategy, and you will lose your top talent.

Charles Dominick of the Purchasing Certification Blog predicted that a new wave of low-cost country sourcing is about to hit us, major supply disruptions caused by significant Force Majeure (don’t know what this means, take his Supply Management Contract Writing course) event will occur, and that a few big name executives, unprepared for either the impending raw material cost escalations (thank China) or Force Majeure supply disruptions, are going to be publicly fired in a big way. I’ll go one further – at least one really big company is going to be the subject of a major lawsuit as a result of their failure to deliver (a) necessary components that cause a major electronics or high-tech vendor to lose considerable market share or (b) promised relief supplies in a timely manner.

Jason Busch, who filed some of his predictions on his joint Supply Now podcasts with Tim Minahan, decided to focus instead on sourcing tactics that innovative procurement organizations will be employing in the year ahead. From strategies that dive into currency, logistics, freight, and import costs, to objective alignment, to strategic supplier rationalization, the top organizations will be extending their innovative mark on their supply chain.

Dave M of Buyer Analytics predicted that technology will transform the way your company interacts with suppliers (a statement Apexon, Connect4Growth, and Servigistics could wholeheartedly support), global procurement will finally mean global talent, spend and supplier management will start its progression from art to science, green procurement will be mandated by forward thinking managers and consumers, and public procurement will be forced to accept modern and lean procurement principles. With the exception of that last point, I think we can all agree – after all, I can think of a few countries that will be as wasteful with public tax dollars as ever this year.

Jean-Phillippe Massin decided to forego predictions and just give you 27 Purchasing Leading Practices that you can employ to take your procurement organization to the next rung on the devil’s staircase.

David Rotor decided to be coy and avoid the issue entirely, but did point out that we are Still Fighting the Talent War and provided you with a nice set of links to posts that complement my own ongoing Talent series very nicely. So I’ll join Tim and David in the chorus: You Will Lose Your Top Talent!

However, predictions have not just been limited to us bloggers. In Sourcing 2007 Part IV, I’ll summarize some of the more salient points from the more traditional media.