[Editor’s Note: Join us Thursday, October 25 at 2pm ET for a complimentary webinar presentation on procurement’s evolving role in strategic category management entitled “Strategic Category Management: The Keys to Unlocking Greater Value” (click to register) sponsored by KellyOCG.]
Over the past decade, sourcing teams have been driving significant value across the greater scope of the procurement function. Within a business unit that lives and dies by the bottom-line, strategic sourcing has long been the linchpin of true supply management success, be it through tried-and-true sourcing activity or analytics-driven approaches to better understand how to best attack corporate spend. However, in a rapidly-changing business environment, in which incredible transformative forces are seemingly disrupting nearly every facet of the modern enterprise, the real value of sourcing may still be maintaining its high watermark…it just requires a more dynamic path than the one that has been taken for so many years.
Traditional and complex categories of spend have long been a funnel for amazing supply management opportunities. These indirect areas of corporate spend, when approached with true strategic competencies, not only drive the contemporary value via cost savings and cost reductions, but greater efficiencies within their specific impact areas. Procurement’s evolving role in strategic category management today doesn’t just translate into the historic boost of realized cost savings…it represents a new means of producing efficiencies that traverse simple dollars and cents.
For too long, many procurement teams have taken tactical efforts towards their large-scale, core categories of spend. Basic blocking-and-tackling, simple automation where needed, and a sheen of procurement’s old-school spend control was always more than enough to drive enough value in the eyes of the Chief Procurement Officer. However, the business world is actively facing its most progressive evolution in, well, forever, and that means the historic category management processes of old are not going to be enough in the face of pure market evolution.
Business travel has long been an expanding-and-contracting arena of corporate spend, forcing procurement units to alter their efforts based on market conditions. Meetings and events require their own level of aptitude that is lost amongst many supply management functions, especially if core capabilities are not fused with marketing expertise. And, the largest spend category of all, contingent labor, is a beast unto itself considering just how much this space has grown (17% of the average company’s workforce ten years ago, over 40% of the overall workforce today) and how much it is actively shifting as the months pass.
If you are interested in learning more, please join Ardent Partners next Thursday, October 25, at 2pm ET for a live webinar where they will look at how a more strategic approach to category management can help sourcing teams deliver greater value to the enterprise. Hope you will join us! Register here.
