Tag: Procurement Best Practices

mining industry

3 Procurement Trends That Can Change the Dynamics of the Mining Industry in 2019

Today commodities are moving back broadly into the global market balance but the challenges for the mining industry are far from over. In a world of more complex ore bodies, deeper mines, social and geopolitical risks, growing energy costs, resource nationalism and lack of infrastructure, global mining industry remains under exceptional pressure to control costs, boost efficiency and improve safety performance.

Rising cost is a cause of concern for the mining industry as the strategies of mining companies depend heavily on the current state of the market. Also, the rise in cost is resulting in the declining quality of ore and limited accessibility of new deposits. This will squeeze the supply in the years to come, potentially driving a commodity-price rebound as the global demand continues to rise. So, the companies need to analyze the new procurement trends in the mining industry that can offer exceptional opportunities for efficiency gains and can help in controlling costs as well.

At SpendEdge, we understand the impact that rapidly changing procurement trends can have on your mining business. And to help companies in the global mining industry to reposition their portfolios and excel in the competitive landscape, our team of experts has highlighted three procurement treContact USnds that have the potential to change the complete dynamics of the mining industry in 2019.

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procurement excellence

Striving for Procurement Excellence? Here’s What You Need to Do

The role of procurement in organizations is no longer a matter of debate. Sourcing and procurement have been gaining increasingly strategic relevance in companies and has been the object of constant attention as it is directly related to the level of effectiveness of the organization and closely connected to the company’s cost structure. There is a new recognition in companies of the positive impact that procurement excellence can have on important performance indicators, like costs and spend patterns. Now, top players across industries are contemplating ways to attain sourcing and procurement excellence in order to gain a sustainable cost advantage for business. Furthermore, companies can analyze their procurement operation and think strategically using reliable data which is a foundational building block of procurement excellence.

Execute transformational changes

Leading organizations leverage internal and external data while undertaking transformational changes in procurement. This helps them shift focus to strategic buying vs. tactical procurement. Combining these elements give companies unprecedented visibility over their procurement functions and better leverage its role in increasing profitability. Companies that have harmonized data around their spending tend to attain sourcing and procurement excellence. For instance, while purchasing raw materials, manufacturers must gain an understanding of the change in spending on a year-on-year basis in order to proactively pinpoint and cater to any significant fluctuations.

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procurement technology

The Future of Procurement: What has 2019 Got in Store?

Advancements in technology, business practices, and consumer demands have brought about a wave of changes in procurement. With time, procurement’s role in business is changing. In most organizations, procurement is now considered a strategic contributor to an enterprise’s growth and performance. Furthermore, the rise of new procurement trends has resulted in considerable changes in the procurement functions. There are several revolutionary procurement trends that we see today, but it is also important to recognize, acknowledge, and perhaps even leverage them as we work to improve the entire procurement cycle. According to the industry experts at SpendEdge, here are some of the top procurement trends that all set to take off in 2019:

Procurement trends 2019 

Digitization and blockchain

Blockchain is one of the hottest topics across various industries right now and is soon set to become one of the mProcurement Trendsost sought-after procurement trends. Blockchain technology is believed to play an integral role in shaping the transparency of a supply chain. This technology would make it possible to easily share and transmit information in a safe manner across the supply chain. Furthermore, consequent to blockchain’s increasing influence, there is a predicted rise in digital adoption and use of the cloud.

Talent shortage

One of the procurement trends that companies can expect in 2019 is a shortage of qualified talent. Through 2020, the jobs in procurement and logistics are excepted to shoot up by over 20%. Some of the key factors contributing to this include – changing skill requirement, aging workforce, lack of development, and the common perception that supply chain jobs lack excitement. As the role of procurement is changing in most enterprises, the requirement for additional skills sets such as soft skills, critical thinking, and creativity are also growing.

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Corporate social responsibility (CSR)

Over the last few years, CSR has become a procurement criterion in its own right. The rising popularity of CSR among procurement organizations is expected to make it one of the key procurement trends in 2019. This trend is particularly noticeable in the public sector as public purchasing policies are based on European directives, and in large businesses with more than 5000 employees as their responsibility is scrutinized more closely and their larger workforces allow for it too.request proposal

Cybersecurity

In the past few years, the cyber-attacks have skyrocketed at an alarming rate in the U.S. To make it worse, cyber-attacks are growing in size, sophistication, and cost. So, there is little doubt that such malicious practices will continue to plague organization in 2019. In response to the threat, procurement teams must aggressively identify ways to protect the sensitive personal and financial information belonging both to their own organizations and to their suppliers.


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CNC Machine

A Procurement Best Practices Engagement for a CNC Machine Manufacturer Helps Uncover Major Opportunities for Improving Products Offerings

Engagement Overview

To identify and focus on key performance metrics in the industrial machinery, a leading CNC machine manufacturer approached SpendEdge to devise a comprehensive approach that would help them identify and benchmark the procurement best practices. The client also wanted to identify and benchmark the procurement best practices to improve organizational growth. During the course of this engagement, a detailed quantitative analysis of various categories within the supply chain was request proposal carried out to identify and benchmark the procurement best practices to be followed.

About the Client

A world leader in the production of CNC machines, headquartered in the United States.

Business Challenge

The CNC machine manufacturer was facing challenges in identifying and benchmarking the procurement best practices of their competitors.


How did SpendEdge Help the Client?

Step 1: Analyzing gathered data to determine gaps

A detailed analysis of the gathered data helped the CNC machine manufacturer to determine the extent to which their present performance lags when compared to the best in their industry segment. The implementation of this step offered a clear picture of their business processes compared to that of their peers.

Step 2: Determined and analyzed the processes to be benchmarked

This step revolved around the process of categorizing and defining the procurement best practices to be benchmarked. This is one of the crucial steps in identifying the best practices as an incorrect identification at the initial stage could result in the expenditure of valuable resources.


Key questions answered in this case study

Benefits of the Engagement

With the help of SpendEdge’s procurement best practices engagement, the CNC machine manufacturer identified the key performance metrics to fine-tune their procurement strategies and drive growth. SpendEdge’s procurement experts also worked as an extension team for the client to help them identify the success factors that uncovered major opportunities for improving their products.

Why incorporate procurement best practices?

Procurement best practices benchmarking is not blindly ‘replicating’ what competitors do. It helps organizations gain detailed actionable insights into the acceptable standards in the industrial machinery industry. This makes it a necessity for any business to understand where they stand with regards to a specific industry standard.

Our Findings

CNC machine manufacturers sometimes devote their time and energy to focus entirely on achieving their business goals. Such an approach to drive organizational growth not only steers the firm from the focused path but also isolates the company from learning from the activities occurring in the business environment. Therefore, an essential way to prevent this from occurring is to constantly keep abreast of the procurement best practices and gauge the benchmarks periodically.


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Auto Parts

Procurement Best Practices for A Leading Auto Parts Manufacturer Helps Improve Their Overall Supply Chain Performance

Engagement Overview

A renowned auto parts manufacturer wanted to identify and benchmark the best practices. To increase customer satisfaction and diminish bad debt write-offs, the client approached SpendEdge to devise a comprehensive approach that would help them identify and benchmark the procurement best practices. A comprehensive quantitative analysis of various categories within the supply chain was carried out to identify and benchmark the procurement best practices to be inculcated in their business.

About the Client

A leading player in the automobile industry space specializing in the manufacturing of auto parts with business units spread across the globe. request proposal

Business Challenge

The client was facing challenges in benchmarking the best practices in the auto parts manufacturing industry.


How did SpendEdge Help the Client?

Step 1: Gathered and analyzed data to identify performance gaps

This step spun around the analysis of gathered data to determine the extent to which the client’s performance lags the best in each segment. The implementation of this step offered a clear picture of the client’s business processes in comparison with their peers.

Step 2: Determined the peer organizations and processes to be benchmarked

This step involved the accurate evaluation and determination of companies to be benchmarked. It acted as a cornerstone for the entire auto parts industry procurement best practices benchmarking process.


Key questions answered in this case study


Benefits of the Engagement

With the help of SpendEdge’s procurement best practices engagement, the auto parts manufacturing client identified the key performance metrics and fine-tuned their strategies to boost savings. Additionally, the client identified the success factors that uncovered major opportunities for improving their services offerings in the global automobile industry.

Why incorporate procurement best practices?

Today, procurement best practices benchmarking has become an integral part of strategic planning and operational improvements. Identifying and benchmarking procurement best practices help companies to bridge gaps and improve performance using quantitative and qualitative information collected from various industry-specific resources.

Our Findings

Procurement best practices enable organizations to increase competitiveness and enhance value from a customer’s perspective. Moreover, if an organization is on the lookout for an objective to enhance market growth, procurement best practices benchmarking is the ideal approach to identify alternative and feasible ways to enhance performance.


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procurement process

What Are the Steps Involved in Procurement Process?

Every procurement process is more complex than it might seem to be. Since procurement is an umbrella term that includes several core business functions, it should be considered a core part of any organization’s corporate strategy. Strategic procurement is an organization-wide process. Moreover, having a good procurement process in place will ensure that companies pay the best price for goods or services, save time by choosing the most reputable vendors, and minimize order delays and mistakes. Each organization varies from one another in terms of their operations and requirements.  Some organizations require a formal process to suit their complex environment, which is often the case in government or education sectors. In those industries, vendors must comply with strict guidelines. Others, like enterprise businesses, require a few key steps to manage budgets more effectively. Here are the steps involved in a successful procurement cycle:Request Demo_SE

Step #1: Need recognition

Every procurement process begins when a business feels the need for a good or a service.  These goods or services can either be internal – any materials required to run the business, or external – materials that the business will eventually sell. At this stage, businesses are also expected to set a budget within which they expect to procure the goods or services. This will help companies to ensure that they don’t end up paying too much and overshooting their budget.

Step #2: Vendor selection

This is one of the most crucial steps in the procurement cycle. Companies must identify different vendors who can cater to their requirements. A comprehensive comparison should be undertaken to understand which vendor provides the best value and quality for your goods or services. It’s important to find vendors who not only deliver a high-quality product for a competitive price but also has a strong reputation.

Step #3: Internal approval

The next stage in the procurement process involves getting the thumbs up from the internal department that controls finances to purchase your goods or services. This includes creating a purchase requisition document and submitting it to that department.

procurement process

Step #4: Purchase order

The purchase order is used to buy materials between a buyer and seller. It specifically defines the price, specifications, and terms and conditions of the product or service and any additional obligations.

Step #5: Order details and invoice

This is the stage of the procurement process where the vendor sends an invoice to the purchaser which describes exactly what the order includes. The invoice confirms the sale and reaffirms exactly when the payment is due. When the purchaser receives the order, they typically have a limited amount of time to notify the vendor of any issues with the good or service. At this point, purchase orders, order receipts, and vendor invoices – are aligned and reconciled, highlighting any discrepancies to ensure that what you are being charged matches what you have received.

Step #6: Payment

Once the order is received, the next step in the procurement process is for the purchaser to make payments to the vendor within the timeframe that has been agreed upon. Usually, payment is made in the form of cash, check, bank transfers, credit letters or other types of electronic transfers.

Step #7: Maintain a Record

The final stage in the procurement cycle is essential to ensure all-around bookkeeping and audit purposes. These include purchase records to verify tax information and purchase orders to confirm warranty information. Purchase records reference future purchases as well.


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Procurement Best Practices for the IT Consulting Services Supply Market

Purchasing and Procurement: All You Need to Know

The New Frontier in Procurement: Throwing Light on Next-gen Digital Procurement Solutions

automotive industry

Transportation Services Firm Leverages SpendEdge’s Procurement Best Practices to Establish New Functional Goals

Sourcing and Procurement Challenges for Transportation Services Providers

One of the biggest sourcing and procurement challenges for transportation services providers is the rising fuel and trucking rates. Firms in the transportation services sector are also concerned that ocean rates are going up and ships are slow steaming as a result of fuel prices. Therefore, it is essential for firms in this sector to work closely with their suppliers to ensure that they use best possible carriers.

Engagement Overview

A leading transportation services provider to identify and establish new functional goals. Additionally, they wanted to benchmark the best practices and enhance the productivity and efficiency of their business operations. As a result, they approached SpendEdge to devise a comprehensive approach to compare and benchmark their business processes and metrics to the procurement best practices.

To help the client identify, evaluate, and benchmark the procurement best practices, SpendEdge carried out a detailed quantitative analysis by assessing research-based data, industry surveys, and interviews. The procurement best practices benchmarking study also offered detailed evidence-based insights on the overall industry’s performance, which helped the transportation services provider to set new functional goals.request proposal

About the Client

An American transportation services multinational company headquartered in Memphis with an annual revenue of over USD 30 billion.

Business Challenge

The client wanted to benchmark the procurement best practices to formulate winning strategies, tactics, metrics, and plans.


How did SpendEdge Help the Client?

Step 1: Detailed assessment of the company’s process performance and procurement gaps

A comprehensive understanding of the existing business processes and gaps helped in deciding what and why factors need benchmarking.

Step 2: Prioritized metric to benchmark

This step involved identification and examination of collected data to reveal the extent to which the current performance can be improved for each segment.


Key questions answered in this procurement best practices engagement include


Benefits of the Engagement

With the help of SpendEdge’s procurement best practices, the transportation services provider analyzed the organization’s past performance in relation to the procurement best practices, competitors’ strategies, and proposed benchmarking changes. This enabled them to establish new functional goals.

Why incorporate procurement best practices?

A procurement best practices study is essential for organizations who are determined to enhance their operational efficiency and performance across different aspects of the industry. The study also enables firms to acquire knowledge on hard facts, including operations rates, performance gaps, and industry risks.

Our Findings

Today, it is pivotal for any organization to understand the acceptable industry standards and determine where their company stands. As a result, it becomes crucial for companies to leverage the use of procurement best practices as it helps them stay in sync with the current market scenario.


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IT consulting services

Procurement Best Practices for the IT Consulting Services Supply Market

The global IT consulting services market has reached maturity, but the trend of outsourcing to low-cost countries continues.

Every time you research online to see how much the market for IT consulting services will grow, you’ll see a common pattern, which is the market is growing, but slowly.” Now you wonder why this market is witnessing slow growth despite the rising adoption of IT services. Well, fret not, we at SpendEdge don’t believe in giving ambiguous answers. Our procurement market intelligence reports offer businesses and stakeholders the scope to understand the supply market and the key factors affecting the sourcing and procurement of IT consulting services. According to our experts, the demand for IT consulting services has matured, and the market is fragmented due to the presence of independent consultants and small firms who provide niche services such as data analytics and IT advisory. (Source: Global IT Consulting Services Category – Procurement Market Intelligence Report)

SpendEdge Insights TrialIn addition, the recent rise in M&As across industries, such as chemical and oil and gas, will boost the demand for IT consulting services to handle activities pertaining to accounting, resource planning, budgeting, and data warehousing. With the preference for IoT rising ever so steadily among end-users, the spend momentum will increase and buyers will not be looking at conventional large service providers to avail effective IT consulting services. The Americas and Europe are expected to be the front-runners in terms of demand but regions like APAC are also anticipated to witness an increase in the demand for such services due to the extensive outsourcing of such services. Now that we’ve established a base for you to understand the growth potential of the IT consulting services market, let’s look at some of the procurement best practices that will help you save costs in your sourcing and procurement activities.

Top three procurement best practices for IT consulting services

Strategy 1: Streamlining execution

Due to the critical nature of their operations, buyers of such services have to focus on streamlining execution and monitoring services in a structured manner. One of the procurement best practices for the buyers is to establish a strategic plan in collaboration with service providers. This would help both parties to create a blueprint of the solution and allow category managers to identify cost-saving opportunities.

Strategy 2: Performance monitoring and benchmarking

To increase supplier accountability and identify potential performance bottlenecks, the buyers of IT consulting services should design strong KPIs for the constant monitoring and evaluation of service providers’ performance. Since the data gathered from establishing effective KPIs would help buyers to gain a better bargaining power during the contract renegotiation phase, it is one of the key procurement best practices to be followed if you are looking to procure IT consulting services at effective rates.

Strategy 3: Emphasize on strategic contract management activities

One of the best procurement best practices to source IT consulting services at effective rates is to define phases and processes that service providers should follow and clarify responsibilities that need to be fulfilled to gain maximum value from their engagements. The critical nature of the category makes it essential for the procurement department to participate in planning actively.


SpendEdge’s procurement report offers strategic insights on the supply market for IT consulting services and helps procurement professionals to gain information on the sustainability and procurement best practices, pricing models, supply market, and key sourcing and procurement trends affecting the global IT consulting services market.

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