Hopefully you attended last week’s webinar on the Direct Procurement Challenge, hosted by the ISM and featuring the doctor and the prophet, where we explained how a sourcing platform cost-centric perfect for indirect doesn’t meet the needs of direct sourcing. But in case you missed it, here are some key requirements not met by typical indirect procurement platforms.
| Requirement | Indirect Platform | Direct Platform |
| Bill of Materials | NO BoM Support | Deep multi-level Bill of Materials Support |
| Cost Breakdown Analysis | Limited to ancilliary costs (shipping, taxes, storage, etc.) | Deep cost breakdown support across the bill of materials which allows costs to be broken down and spread out across components, the production process, distribution and inventory management, and overhead |
| EDI, WebEDI, & XML | XML data exchange only (maybe) | XML, EDI, and WebEDI and direct integration into supplier systems |
| Quality Management | RMA & account credit request (maybe) | APQP, sample test reports, standard 8D & QDX complaints report; goods issue documents |
| PLM (Product Lifecycle Management) | No PLM Support | Integrated project management and product lifecycle management from cost breakdown analysis and BoM definition in the sourcing phase to production and inventory management in the supply chain phase to quality management and return management in the support phase |
And in Sourcing Innovation’s latest paper on The Direct Material Procurement Challenge: An Indirect Tool for Direct Procurement is Mission Improbable – Direct Procurement Requires Different Capabilities, the doctor discusses 10 (ten) additional reasons why an average indirect platform cannot solve direct Procurement needs. Check it out!