Let’s face it, once May comes around, you’re under the gun to identify significant savings before the end of June when you, or more importantly, your bosses want to take some time off during the summer (and know that suppliers do the same and results will likely be limited until people get back to work full force in September).
But if you wait until May to identify those categories you are going to go after for quick wins, you’re better off panning for gold … it will have a better success rate. Even if the best method to capture those savings is identified as a reverse auction, and even though it can be run in a day, by the time you
- run a spend analysis across categories not significantly under contract or where the contract is expiring
- collect market / should cost pricing and demand across the categories and estimate savings opportunities
- rank the opportunities
- evaluate each opportunity and identify the best strategy
- extract those where auction is the best choice
- identify the appropriate supply base for this subset of categories
- get the suppliers onboarded in your SRM/Sourcing system
- send the invites and get commitment
- run the auction
- cut and sign the contracts
… it’s mid to late summer. But if you start this process now, limit the quick-hit projects to those where you already have most of the suppliers in the system, and get going just on those, you will have time to finish a few of them before summer hits. Otherwise, if you wait for May, you’re better off packing your pans and booking a ticket to Alaska.