In your personal life as a consumer, it makes sense that most of your responsibilities end once you select a supplier. In most cases, you go to the store, you pick out what you want and purchase it—thus ends the transaction. If you are having work done on your house, you may have a few contractors come out, you select the one you like best, and then it is up to the chosen firm to get the job done. You are the customer after all, and satisfying the customer is an important role of the supplier.

This view of a customer/supplier relationship often carries over into the business world. Traditional thinking suggests that once a contract is signed, the work of the customer is complete and any further responsibilities fall upon the supplier. Most people assume that the implementation phase and subsequent account management function will be led by the supplier, with little or no obligation put upon the customer. After all, the suppliers are the experts. They have worked on implementations hundreds if not thousands of times, and they know their businesses well. Their job is to service your account and ensure a satisfied customer; your job is to pay for those services or products.

This traditional view of the customer/supplier relationship still exists within many organizations, and it is a primary reason why many strategic sourcing initiatives end in failure. A few years ago AberdeenGroup, issued a report called “The CFO’s View of Procurement.” In this study, AberdeenGroup found that only 34% of projected savings from strategic sourcing activities are actually realized. To put that another way, 66% of the savings available in most sourcing projects is left on the table.

There are two reasons why the vast majority of savings opportunities are squandered: lack of an implementation plan and lack of an stakeholder management strategy. These issues are linked to the same root cause, which is that the sourcing team, end- users and other executives, fail to realize the importance and impact of change management has during a strategic-sourcing engagement.

Over the course of my next few blog posts, I will review some of the typical challenges that arise during an implementation. I will also explain what you as the Sourcing Lead can do to overcome these challenges.

What unexpected challenges have you faced when trying to implement a new cost savings program? What have you done to address it?
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Joe Payne

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6 comments so far,Add yours

  1. Nuts are well known for their nutritional benefits, heart healthy fats, proteins, antioxidants, plant sterols ( natural substances found in plants that can lower cholesterol ), fiber and minerals. Walnuts is the best nut to eat.

    Joe Vinson, PhD from the University of Scranton in PA tabulated the quality of antioxidants in nine different nuts: almonds, Brazil nuts, cashews, hazelnuts, macadamias, peanuts, pecans, pistachios, and walnuts. He found walnuts have the highest level of antioxidants and most powerful antioxidants, ranking from 2 to 15 times stronger than vitamin E. As walnuts are eaten raw there is no reduction in antioxidant quality which you may lose by roasting. According to Vinson, “Walnuts rank above peanuts, almonds, pecans, pistachios and other nuts”. People do not eat enough walnuts or any nuts at all. Some people are unaware of the health benefits of these type of nuts and other are worried that they might gain weight. Nuts can help people feel full and so you do not overeat. Only seven walnuts a day are necessary to provide health benefits.

    -Yagnesh out!

  2. Schrödinger's NutsJuly 20, 2011 at 1:34 PM

    Unlike walnuts, pistachios and cashews can see into the future. They already know about the weather, economy, wars, famines, natural disasters, elections, lottery, golden globes, super bowl.

    A scientist has also done a study on these nuts and has found they have very peculiar quantum properties. For example, the scientist and his team have demonstrated that pistachios and cashews only exist when observed. They have postulated that it is possible to time travel simply by consuming these delicious morsels. Further, these nuts have been the key to unraveling the mystery of immortality. In order to eat these you must not eat them.

  3. When I was just a wee lad, I bit into a hazelnut and was astonished to find it inhabited by a worm. Fortunately the worm only suffered a flesh wound. I was able to nurse her back to health, and the two of us became best friends. Two weeks later a rival gang of little people broke into my house and stole her. I never saw her again, but sometimes imagine her squirming through flourishing fields of peanuts and almonds.

  4. A peanut is neither a pea nor a nut, but rather a legume. The legume is a type of nut that looks and tastes like a pea. Legume nuts have various beneficial qualities, including preventing and removing hemorrhoids. There are exponentially numerous other benefits for peanuts that can be taken advantage of.

  5. Great tip GW. I have been using peanut butter as a substitute for hemmorrhoid cream for years. It is much cheaper and tastes better too.

  6. Peanuts are the only nut officially endorsed by the U.N. as a catalyst for world peace and as insulation material for Habitat for Humanity homes.

    An officially-sanctioned U.N. NGO, named the Nut Squad, had initiated a program to plant peanut trees in officially designated U.N. conflict zones, as symbols of hope and an exercise in community building. Our motto is, "Are you a terrorist, or are you nuts?" Please join us.