Category Archives: Market Intelligence

Top Posts of 2016! An Analysis.

Procurement Leaders are Getting Deeper Into Sourcing Strategy

Consider that the 8th and 7th most visited posts are on aligning procurement strategies to business goals. Not only are leading Procurement organizations adopting deeper sourcing strategies, but they are looking to better align those strategies with business goals to extract not just savings, but value. The leaders are realizing, with inflation coming back, the days of savings in a mature Procurement organization are numbered.

Moreover, the fact that the 9th most visited post is on the direct procurement challenge, this indicates that not only are Procurement leaders looking for value, but they are beginning to realize that in order to capture that value, direct procurement has to be done correctly and requires more depth than just a simple auction for office supplies.

Then we have the 4th most visited post being part of the series on how Trade Extensions is redefining sourcing — again indicating that leaders want to do better.

Analytics is Taking Center Stage

The fact that the 6th and 3rd most visited posts of the year are deep dives into not only modern analytic technology, but modern analytic technology that is beginning to apply machine learning in adaptive and useful ways, means that many organizations are not only realizing that they not only need good analytics, but good analytics support.

Supply Chain Finance is On Leader’s Minds

The 2nd most visited post is our post on how the death of factoring will be highly exaggerated. Even though this isn’t really supply chain finance, it’s sold as supply chain finance, and companies that are still relying on it (and trying to figure out how to advance) want to understand what it is, where they are, and how long they have to advance.

Training is Still an Issue …

… even if the budget’s haven’t been restored. The 10th most visited post is on training a procurement team. Leaders recognize that their talent has to be trained to get top results, but with limited budget, they are starting to think about holistic team training vs. individual training.

But Technology is pushing to the forefront.

The 5th most visited post of the year is our rant on how driverless delivery is nothing more than a tantalizing theft target (and how over-investing in automation is not always going to save you money). And the foremost visited post of the year, part of our procurement sustentation series, is our post on IP and Patents. People want to understand technology, the protections around it, and how to tread the issue.

Top Posts of 2016!

Now that we’ve counted down the top posts from the archives, we’re going to count down the top posts of the year, based on direct page-views. (These could be slightly out of order as most posts are accessed by main page accesses, but, as daily visits are fairly consistent, the relative order should not be off two much.) Our expectation is that many of these posts will continue to be read in the years to come as SI posts, which focus on education and not entertainment, truly do stand the test of time (as explained in our previous posts)!

Runner Up:

Give Your Procurement Some Backbone! Part I

10. Training a Procurement Team

09. 5 Reasons Why You Need to Take the Direct Procurement Challenge!

08. Aligning Procurement Strategies to Business Goals, Part I

07. Aligning Procurement Strategies to Business Goals, Part II

06. TAMR – Trying to Tame the Data Deluge!

05. Driverless Delivery? Tantalizing Theft Target!

04. Trade Extensions is Redefining Sourcing, Part IV

03. Spend 360 – Applying Deep Machine Learning to Spend Analysis

02. The Death of Factoring Will Be Highly Exaggerated

01. Technology Sustentation 89: IP Patents

What does all this mean? Come back tomorrow for our analysis.

Top Posts of 2016 … From the Archives … Explained!

Yesterday we counted down the top 20 visited posts from 2016 from the archives, which also contained the top 11 visited posts overall. What does this imply, besides the fact that posts on SI stand the test of time (due to their educational, vs. entertainment, focus)? It means that the desire for Procurement knowledge is increasing, and, more importantly, when you dig in, that a lot of organizations are still struggling with the basics.

Third Party Vendor Reviews Are Important

The 20th most accessed post was vendor day reprise, which centralizes links to the the vast majority of unpaid vendor reviews done by SI. The 8th most accessed post was from the Best Practice Vendor Selection series, and on Part V: Stuck with an ERP? You do have options! in particular. And the 3rd most accessed post is on how BizSlate is Bringing Sexy Back to ERP. In other words, many organizations are still on ERP and trying to figure out how to take it to the next level and how to either migrate from, or, if they are stuck with it, augment their ERP.

A Basic Understanding of Sourcing vs. Procurement is Being Sought

The 12th most accessed post was on Source to Settle – The Sourcing and Procurement Kettle, which follows up SI’s classic post on how it’s Sourcing And Procurement (and advertises a paper and webinar that explains it all). The 13th most accessed post addresses the Difference Between Direct and Indirect and the 11th most accessed post provides a Strategic Sourcing Plan Outline. Then the 9th most accessed post is Smock on Sourcing Strategy, the 5th most accessed post is on Developing Category Strategies, and the 4th most accessed post is on the Evolution of Purchasing. Plus, the 10th most accessed post is on the advantages of decentralization and the 16th most accessed post is on the advantages of multi-tier supply chains, which shows that not only is an understanding of sourcing and procurement being sought, but so is an understanding of how to structure it as well.

The Talent Issue is Still Omnipresent

The 15th most accessed post is on Gen X, Gen Y, and Gen Z and the 7th most accessed post is on the importance of the job description to your talent management strategy.

Risk and Related Areas Are Always Back of Mind

The 18th most visited post in the archives was on Bank Payment Obligations (as lack thereof puts many organizations’ financial supply chains at risk), the 17th most accessed post was on common negotiation ploys used by sales teams (as not knowing them puts a Procurement department at risk of leaving too much money on the table), the 6th most accessed post was on how the purpose of a contract is easy to define (as poor definition creates high risk), and the 2nd most accessed post was on five types of supply risk and how to mitigate them.

There Are Still a Lot of Organizations Beginning Their Procurement Journey

Not only was the top post of 2016 RFX Defined, but it was accessed almost twice as many times as the next most accessed post. (In fact, it was access over 10,000 times!)

On the Second day of X-Mas (2016)

On the second day of X-Mas
my blogger gave to me:
some Trend Bashing Posts
and some ranting on stupidity …

Regular readers will know that if anything grinds the doctor‘s gears, it’s “predictions” and “trends” because, frankly, it’s typically the same old, same old verbal spew year-after-year or it’s something so far out and so far fetched that the chances of it actually coming true are miniscule (unless, of course, it’s so vague as to be effectively useless). So, today, we remind you of one of SI’s classic series on the subject back from 2014.

Old News Part I
Old News Part II
Old News Part III
Old News Part IV
Old News Part V

Ongoing Blues: Part I
Ongoing Blues: Part II
Ongoing Blues: Part III: The Inflection Point

Like New Remanufactured Shoes: Part I
Like New Remanufactured Shoes: Part II

Shiny New Shows; Part I
Shiny New Shoes: Part II

And if this wasn’t enough to whet your appetite, you can also download the first part of our Future Trend Expose!

Come back tomorrow for the third day of X-Mas.

What’s the Future of Just In Time for Consumer?

It’s the holiday season, which means retail is in overdrive. This means on-line retail is in overdrive, and this means shipping is in overdrive.

Shipping which relies on postal services or private carriers. Postal services which are in dire straits and which are getting costlier by the year and private carriers which are also getting costlier. The USPS recently announced yet another round of price increases for 2017, just six months after it raised prices almost 10% (which followed price increases barely six months before).

Costs just keep increasing, and it’s hurting small retailers who can’t negotiate Amazon and eBay bulk shipping rates (and offer free shipping @ 35 or low cost shipping on individual orders). People aren’t going to pay a $20 shipping fee to ship a $10 product. And they’re not going to buy from retailers where this is the case.

So, we’re entering the age where the Amazons and their ilk are going to do in the online world what the Walmarts and their ilk did in the offline world — kill the little guy unless the little guy falls in line. Prepare to see even more Amazon and e-Bay storefronts popping, piggy-backing off the already in place infrastructure in exchange for a small piece of the profit. And prepare to see the closure of even more independent storefronts that wanted to compete without having to give a cut to the new digital mafia, as they just won’t be able to compete.

This means that sales will centralize, but shipping rates won’t necessarily standardize. The Amazon resellers also use the Amazon warehouses will be able to take advantage of the lowest shipping rates, and the rest, like the e-Bay storefronts, will be subject to reduced rates, but not the Amazon warehouse rates. And these rates will keep increasing as fuel goes up, labour goes up, and the carrier rates go up even more. Stores were invented for a reason — it’s much more cost effective to ship a pallet to one location than 100 items to 100 locations. Even with route optimization, right turns only, last-leg optimization with the local post, and so on — package delivery costs can only go so low. As long as a human is involved.

This says that the future of just in time for the average, cash-strapped consumer, is likely one of two futures. The past where physical stores regain their supremacy. Or the pre-SkyNet future where drones rule the skies.

However, the best future for just in time consumer delivery might be one where the old mail order model is modernized for the e-Commerce world. Back in the day, if you were in a rural community or small town, and you wanted something from a big box store (like Sears) you’d go to a local mail-order outlet where you would hand over some money (which could just be a deposit or the entire amount) to order something from a catalogue. Then, a few weeks later, you’d go back to pick it up. Amazon has revived this with the Amazon locker where you can get faster delivery and pick up by agreeing to pick up at a nearby locker, which is essentially a digitized bus locker system where you scan a code which opens a locker with your package.

The best future is one where a third party opens a lock location that can be rented by any online merchant that wants to use a locker for delivery where carriers offer lower rates to ship to the locker location. It would require at least USPS to agree to offer lower rates to ship to a locker location, which would require a large number of locker locations for the locker owner to negotiate better rates. This means that, in the short term, for this concept to take off, Amazon will have to go heavy into it, offer not only faster shipping but significantly lower shipping rates to get them to take off, and then offer these rates to their resellers at cost, or a loss, to get everyone using them. But it would then be able to capitalize on yet another revenue stream, as it could allow third party non-Amazon storefronts to ship to these locations for a small fee, and get an even bigger footprint in the physical world — which would allow it to create Amazon stores with “best sellers”, the same way Apple was able to create Apple Stores.

In summary, the future of just in time for consumer is still a bit cloudy, but it should be a hybrid locker / storefront model where costs can stay down, but customer satisfaction can stay high. Thoughts?