Analyze. SOURCE. PROCURE.
Effective sourcing has always been a mix of science and art, often more art than science. In today’s hyper-competitive business environment, you can hardly afford to relegate supply chain quality and product margins to a casual process based on the skills of a few individuals. You need a deep understanding of your buying process, your suppliers and your buyers themselves to gain the insight that can be
truly leveraged for competitive advantage.
Analyze for Understanding
To begin, Clear Peak works with your team to develop a detailed category analysis of products and services including total cost, product specifications, service requirements, distribution, market conditions, etc. Then, we conduct industry research to expand your list of potential suppliers, leverage your buying position and improve readiness for market disruptions by rethinking industry trends.
“Excellence is a continuous process and not an accident,” said scientist and former Indian president, A. P. J. Abdul Kalam.
Spend cube analysis, as it is often called, is best conducted annually or even more often in highly volatile buying environments. Your initial efforts can be formalized into an on-going process that yields continuous improvements and quantifiable results.
Source for Advantage
Sourcing can be a huge competitive advantage when you take a scientific, fact-based approach to your buying processes. Clear Peak focuses on high-value opportunities uncovered in your assessment, to help you quickly realize the advantages of process improvements. These include:
Faster supplier response
And better control using automated RFI, RFP and auction systems
Better supplier agreements
Using a highly structured, internally and externally-coordinated negotiation process and by teaching your buyers new negotiation skills.
Fewer mistakes and enhanced buy-in
Using improved communication to buyers, vendors and other stakeholders
Improved management and control
with reports and dashboards using fact-based KPIs.
Procure for Success
Once your suppliers are in place and aligned to your business goals, Clear Peak will help you establish a fine-tuned procurement process along with a well-trained, organized team. This will result in:
- Greater alignment between the business and procurement through updated policies and agreements
- Enhanced accountability with strong internal controls over buying and payment processes
- Improved integration with your ERP system, buying portal, eCommerce tools and other critical internal systems
- Less rework and fewer delays with well-understood performance guidelines for transactions, exception handling and internal auditing
Your procurement team will appreciate the clarity of their mission and your suppliers will value your crisp execution. Procurement operations will set a new standard for operating effectiveness in your organization.
Case Study: Manufacturing/Retail
A manufacturing/retail company needed to reduce indirect costs, improve supplier management and tighten spending controls. The business was skeptical that its new corporate procurement department would deliver projects on time, while outsourced procurement lacked metrics for accountability. An ERP implementation was imminent and use of POs was negligible.
- After a detailed spend cube analysis, the company sourced high impact spending categories using consortium buying, complex categories with cross-functional teams and critical categories with specialized expertise
- They reconfigured procurement operations agreements, established KPIs and shored up gaps in ERP implementation planning
- The team selected and installed software to enter POs into the new ERP system and conducted global training for the procurement team
This project delivered more than $4 million in annual savings for the first wave of spending categories, against a direct cost of $400,000 for the program implementation for a 10:1 ROI.
Procurement specialists helped the client enact mission-critical processes for seasonal marketing releases while meeting new global quality standards. The team also greatly improved visibility into outsourced operations and increased compliance to policy