Category Archives: Sourcing Innovation

Forget Lean Sourcing, It’s Time for Mean Sourcing!

While it sounds like lean sourcing, which can be defined as a strategic purchasing approach focused on maximizing value and minimizing waste, should be the ultimate solution to strategic sourcing, especially when you consider some of the core activities in Procurement:

Value Addition: Identifying exactly what the end customer values and eliminating products, features, services, or luxury materials that do not contribute to it. (Supports Value Definition and Value Stream Mapping)
Process Standardization: Simplifying workflows to reduce bottlenecks, speed up purchasing cycles, and lay the foundations for automation. (Supports Flow)
Strategic Partnerships: Cultivating close, long-term relationships with a compact, reliable supplier base rather than continually chasing the lowest bidder to streamline the supplier network. (Supports Pull)
Continuous Improvement: Cultivating a culture where buyers regularly refine practices and reduce inventory. (Supports Pursuit Perfection)

it should be the perfect solution. But it’s not. The problem is that Lean was born out of manufacturing, not supply chain, and not sourcing and procurement. Here are the problems with Lean in Sourcing/Supply Chain:

Myopic focus: Taken to extremes, not only results in a company minimizing not only product lines, and the components used, but their focus on the product lines that consumers want. This is profitable and successful in the short term, but consumer preferences for products change over time, and if you don’t keep up with shifting consumer trends, you’ll be too late to capitalize on major opportunities. (Just like Blockbuster missed out on Netflix, Kodax on digital cameras, and Xerox on the personal computer.) And if you don’t keep an eye out on new developments, you’ll miss opportunities for new integrated components and working with engineering to save money.
Automation First Philosophy: the whole point of process standardization was to allow for consistency, transparency, productivity, error reduction, and resource optimization, not necessarily automation — but the interpretation has been to automate everything without any thought as to whether or not humans can do it better or Human Intelligence (HI!) is needed
Long Term Agreements: a long term agreement is not a partnership, it’s just a long term contract; most Procurement organizations have failed to grasp what a strategic partnership is! (Japan gets it with keiretsu, but that’s about it.)
JIT: you want JIT in terms of factory production, especially since factories have limited space so you don’t want to pull from the warehouse too fast, but it’s one thing to JIT from a local warehouse, it’s another thing to try to JIT across global supply chains filled with fragility and unpredictability and constant disruptions

In other words, in order to succeed from lean, you have to modernize Lean for Procurement and the modern world. And get a little mean while you’re at it.

while the primary focus is optimizing costs against the value stream, the secondary focus is pushing strategic partners for new designs and products that will change both the value of the customer offering as well as the cost of production and service; in other words, you’re only happy with the status quo today, you expect proposals for improvement tomorrow
constantly push for process redesign where you can reliably use unintelligent automation (with rules-based deterministic certainty and adaptive exception management) and not hallucinatory agentic / Gen-AI for true efficiency improvements; it also keeps platform/cloud costs way down even as throughput scales by orders of magnitude
shift from cost focus in agreements to co-development focus — that’s the way you form true partnerships
migrate to balanced inventory management where you keep extra stock on hand of critical/scarce/hard-to-get materials and components sufficient to cover at least the average delay time when a disruption occurs — it can also optimize logistics costs and production costs at a different economy of scale, making up for the slightly increased inventory costs (which only need to be a fraction of their traditional inventory-cost based percentage with smart inventory management)

In each of these cases you are forcing more than just the process (which your team and suppliers will think is mean), putting cost second (which the C-Suite will think is self-centered because it’s all supposed to be savings to please the board members), and putting more burden on your internal networks (which your team will think is really mean, considering your operations and consultants have spent decades shifting to suppliers).

It might seem mean, but modernizing your practices in a resilient and collaborative fashion is what it will take to thrive in today’s global landscape.

The New and improved Triple Lucky Sourcing Innovation Cascading Mega-Map … Now With 33% More Vendors!

7EB V1 Edition ^{(c) 2026-09-27}

Still totally useless, but still slightly less useless than every other logo map that clogs your feed!

1. Every vendor url still valid and active as of 3 days ago! (w.r.t. posting date)

2. Every vendor logo is clickable and takes you to a live site (as of 3 days ago w.r.t. posting date)!

3. Every vendor is mapped to a meaningful category as of the last date of analyst investigation!^*

So what’s the point? Click here for the full explanation that has been moved to the end of the post (as it’s the same as last time).

In summary, let this be proof that there are a lot of logos in our ProcureTech+ space and that, if you want logos, you got logos!

888 of them!

Enjoy!

			Source-to-Pay
Souce-to-Contract			Procure-to-Pay				Intake-to-Orchestrate
Sourcing + SXM + CLM	Sourcing + Analytics	SXM + Analytics	e-Procurement	Invoice-to-Pay / AP	Expenses	Payments (& P-Cards)	Training
Sourcing + SXM	Sourcing + CLM	SXM + CLM		Sourcing	SXM	CLM	Analytics
Direct Supply Chain	Cyber Monitoring	ESG / Carbon	Marketplaces	Legal	Marketing	SaaS	Intelligence
	(3^rd Party) Risk Mangement	Contingent Workforce Management	Hospitality	(e-)Document Exchange	AI Procurement Offerings	AI Frameworks (Generic)

Source to Pay

Source to Contract

Sourcing + SXM + CLM

SXM + CLM

Sourcing + CLM

Sourcing + SXM

Sourcing & Analytics

SXM & Analytics

Contract Lifecycle Management (CLM)

Sourcing

Supplier Management (SXM)

Analytics

Procure-to-Pay (P2P)

eProcurement

Invoice-to-Pay (I2P) / Accounts Payable (AP)

EXPENSE

PAYMENTS & V/P-CARDS

Intake-Manage-Orchestrate

ESG/Carbon Scope 3

Cyber Monitoring

Direct Supply Chain

Legal

Marketing

SaaS

Training

MarketPlaces

Intelligence

Risk

Contingent Workforce Management

Hospitality

OOCument eXchange

AI Procurement Offerings

AI Frameworks (Generic)

To again make it utterly clear you can’t select a vendor based on a random grouping of logos on a map, even if they are categorized! (And especially if the solution has not been human reviewed and verified!)

Not even if the map categorizes the vendors by market size, industry, and/or geography. Those are just proxies for organizational spend, solution needs and cultural requirements. Not every mid-market manufacturing plant in the USA is the same.

The only way to select a good vendor is to follow a proper assisted process and engage an expert who understands what vendors are out there to identify the right vendors to invite to the RFP process once your true needs have been identified.

Especially considering the true number of vendors out there is many times more than what an average big analyst firm will tell you, especially when they restrict their recommendations to their paying clients in their maps, and multiples of what an average big consultancy will tell you, especially when that consultancy only knows their partner solutions (that they need to maintain significant focus on to maintain their preferred partner status).

So, what’s the value?

As we explain in detail in the real value of the sourcing innovation mega map, it shows you

why you need proper proper assisted solution selection (and we can’t stress this enough)
how dynamic the space is:
- 2 more companies are gone in just 8 months
- 8+ companies have been acquired or renamed
- there are just too many options for an average buyer to make sense of
quite a few vendors ARE NOT GOOD (for you at least) by statistics alone

P.S. Generally, logo size means nothing — logos were scaled to be readable. However, in this 7EB V1 preliminary version of the 2027 Mega Map, new vendor logos are 25% larger. (These new vendor logos will be scaled back in size 25%, or all the other logos scaled up 25%, in the final version, likely released in January after the annual culling when walking dead vendors typically go into liquidation or shutdown or acquired vendors get full absorbed into the acquiring company.)

^* Some vendors haven’t been reviewed in a few years, so offerings may be more extensive than what was originally offered, or may have changed focus. (One analyst can only review so many vendors a year!)

What e-Sourcing Is Not – A Necessary 7-11 Update!

Twenty years ago we wrote a post on e-Sourcing Resistance and what e-Sourcing is Not. In that post, we began by referencing “The 7 Myths of e-Sourcing” by the great Tim Minahan (before he went over to the dark side), where he tried to dispel the myths.

Since the original myths still persist today, we’ll start by reminding you of those — and then address the new myths that have arose / are arising so you don’t lose the path.

Tim’s Original 7. e-Sourcing is NOT about

lowering prices: it is about getting the best, fair, price you can get on a product, or service that meets your needs, but not about squeezing supplier margins so thin they go out of business
unfairness to suppliers: it’s not about forcing out or limiting to preselected suppliers, but creating an open, level, fair playing field
unfairness to incumbents: it’s not about forcing incumbents out, it’s just about ensuring they also play on a fair, level, playing field
keeping suppliers out: it’s not about making business more difficult to win, but easier to win
sales cycle lengthening: it’s about making sourcing processes right-lengthed
supplier burdening: it’s not about adding costs, technology, or resource requirements — but minimizing the burden on the supplier
eliminating relationships: it’s about finding the right supplier to build a relationship with

but with the rise of technology, and, AI, in particular, a new set of myths has arisen and needs to be dispelled ASAP. E-Sourcing is NOT an excuse to:

turn every Procurement event into a(n) (e-)Sourcing Event: just because you can, doesn’t mean you should … most procurements should be off existing contracts, most tail-spend should be spot-buys, and when the volume/cost is enough, simple RFQs; e-Sourcing is for goods and services that are strategic or custom, not tactical or commoditized
use AI to draft RFPs: with AI, you can draft RFPs, and incorporate as much as you want into those RFPs, and ask as many questions about as many things as you want — this might make your life easier, but it unfairly burdens suppliers when you ask for details you don’t need (at least until you are going to seriously consider them) — plus, AI will hallucinate, ask wrong questions (and then force a follow-up request later when it’s discovered) and waste time on both sides … RFPs need to be human drafted — they should be based on templates (and assembled using non-LLM AIs), and AI should be used to judge completeness, clarity, etc — and even recommend gaps to fill in (because, when well trained, 90% accuracy can be useful), but AI should never lead
use AI to conduct events agentically: AI should be used to automate the tactical, but humans need to be engaged at every decision point
use the same process for every event: some events should be simple one-shot mini-RFPs just to verify key product/service requirements; some events should be moderate two-stage RFI/RFPs to ensure the suppliers meet mandatory organizational requirements; others deep three-stage RFI/RFP/RFQ processes to first verify suppliers, than products and services, then BAFO pricing so complete information is known before a decision is made

e-Sourcing is about right-sized efficient execution of strategic sourcing events for both sides, nothing more, nothing less.

The Great Thing About Optimization: You Can Cost Constraints and Solve for Them!

The Sourcing Optimization Grand Master Paul Martyn, as part of his ongoing Sourcing Excellence, published two great posts on how The Most Important Constraint Is Often Left Unspoken and The Real Problem Is Usually Context.

In Part 16, Paul notes that:

Sometimes the most important part of the decision never gets discussed directly.
Nobody says: “We don’t trust ourselves to manage the transition.”
Nobody says: “If this fails, I own the fallout.”
Nobody says: “We’d rather pay more than explain a disruption.”

But they poison the model by insisting on:

Extra incumbent weighting.
Requirements that narrow the field.
Timelines that make supplier change almost impossible.
Risk language that quietly points one direction.

Which ensures that the “optimal” solution is one that keeps the incumbent, even though it’s far from the optimal solution.

Then, in Part 17, Paul notes that context is the harder problem. That while the sourcing team can model price, lead times, freight, capacity, payment terms, supplier performance, etc., the data doesn’t capture:

a plant manager [who] still remembers a shutdown tied to a supplier change
marketing does not want packaging changes during a seasonal launch
finance is suddenly focused on working capital
operations is protecting uptime
an incumbent relationship [that] carries more internal support than anyone says out loud

And this is what leads to the insistence of constraints and inflated switching costs in the model that mathematically ensures the “optimal” solution is the one where nothing changes, even though the CFO can clearly see that costs are 5% above market averages with no real explanation as to why the organization has to pay that much to minimize risk, ensure supply, yada, yada, yada.

But here’s the thing, if the real issues are surfaced BEFORE the event begins (and the model built):

Even though the plant manager is scared of a shutdown, the probability can be computed and the cost can be quantified — as the cost per hour/day/week is known
The cost of extending the current contract just through the launch can be quantified and the cost of keeping the supplier for the whole contract term vs. just the launch and then switching to a new supplier can be computed
Up front vs. over-time costs can be modelled and the cost of solutions that require more investment up-front vs. later can be compared and contrasted
The on-time expectancy per supplier and carrier can be modelled and accounted for
The true cost of the incumbent preference can be modelled

The great thing about strategic sourcing decision optimization with what-if scenario support is that all costs and constraints, if properly expressed, can be modelled and the true cost of a preferred, vs. market, scenario computed. If the cost difference is inconsequential, then you go with what the people want. If it’s significant, then some real discussions need to happen and some real decisions need to be made.

Sourcing and Procurement Are NOT The Same

And they are definitely NOT interchangeable, as per a recent article by Paul Martyn (the Sourcing Optimization Grand Master) on LinkedIn.

As per his article,

sourcing is strategic
procurement is transactional

And this is why they are not only not the same, as per Paul’s article, but not interchangeable.

In the age of AI (Hype), this is distinction becomes doubly important!

As technology advances rapidly, humans become less and less important in Procurement as rapid advances in automation allow more and more of the tactical process to be completely automated (as ARPA allows exceptions to be learned and future manual intervention requirements to be eliminated) but more and more important in sourcing as Gen-AI repeatedly proves just how Astonishingly Inept modern Artificial Idiocy is.

Many will argue that sourcing is tactical because modern software can assemble RFXs from existing specs, automatically select suppliers from your SXM and/or ERP, automatically distribute them, automatically validate the returned RFXs, eliminate vendors who don’t meet absolute requirements, analyze the responses against market data for validity, build and execute multi-objective models, and recommend and award. And while that certainly sounds like sourcing, it’s not. It is sourcing execution. The tactical part that has to be done to support the strategic, but NOT the strategic.

The strategic is creating the specs, identifying the real organizational requirements, determining the requirements for supplier inclusion, validating the suppliers, determining the proper (multi-round) event type, validating the generated RFXs, analyzing the responses for hidden risks and traps and idiosyncrasies, defining the right trade-off models, selecting and modifying the right award scenario, overseeing the negotiation, etc. Every part of the process that requires an actual decision with Human Intelligence.

This is because, as Paul points out, a dumb machine doesn’t understand:

lowest cost vs resilience
incumbent vs challenger
standardization vs innovation
savings vs service
global leverage vs local agility

Or any other trade-off that can’t be completely quantified and captured in fail-safe rules.

Systems can, and should, support all tactical bit-pushing — especially since we were promised they would do so over 40 years ago when the big push was made for every person and business to adopt them — but, like IBM said in 1979, a computer should never (EVER) make a decision. And that most definitely includes Sourcing decisions!

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7EB V1 Edition (c) 2026-09-27

7EB V1 Edition ^{(c) 2026-09-27}