This guest blog has been brought to you by Jeanette Jones of Cottrill Research
As a writer and follower of supply market intelligence (SMI) research resources, it remains clear that unintended hurdles created by both procurement at large and third-party data providers continue to hamper SMI initiatives. A couple of these hurdles include procurement's timidity towards SMI and the costly nature associated with acquiring authoritative information resources. What can procurement and third-party data providers do to help clear these hurdles? Promising trends are developing that can ease the way for professionals who want to transform their function to provide competitive value. Here are three trends that have potential.
Trend #1 - Intelligence Creation
Recognition by procurement of the value and growing importance of intelligence creation is increasing. When comparing procurement's struggle with proving value to the organization, I have written about the "spirit" of the open access/knowledge movement and the transformational impact it is having on the information industry and in academia. Procurement has in its grasp to be transformative by positioning itself as the expert creator and curator of intelligence that provides true competitive advantage. Procurement creates this intelligence from a unique perspective. This perspective utilizes internal intelligence, such as historical spend data and corporate growth strategies, combined with external market intelligence acquired through targeted research efforts. In addition, this perspective allows for identification of anticipated intelligence needs and the ability to proactively push (as opposed to the old "pull" model) what is discovered to fellow professionals, internal stakeholders, and the organization as a whole.1 Confession: I'm not sure if this is a full-blown trend, but my fingers are tightly crossed.
Trend #2 - The Emergence of Open Access Data and Shared Knowledge
Open access is everywhere. When using the term open data or open access, I am referring to information that is freely accessible in terms of cost, registration requirement, or sharing restrictions (except for author attribution). Businesses are starting to understand the opportunities associated with open data. McKinsey, in a report entitled, "Open Data: Unlocking Innovation and Performance with Liqid Information," states: "Businesses are finding new ways of segmenting markets by blending open data with proprietary data and discovering new ways to raise productivity by using open and proprietary data to benchmark operations."2 Open access data, provided by governments, world organizations, interest groups, associations, trade journals, third party content providers, and free content provided by analysts, is widely available for procurement professionals. Open access is basically about sharing information. We also see this concept in the form of crowdsourced resources and wikis. Corporate-wide Knowledge Management initiatives will become more prevalent as shared information, to be useful, will need a search/retrieval system and repository. Blogs and social media are also enabling the sharing and identification of open information. A good example of this is the use of blogs. Blogs, written by analysts and experts that follow a certain market, service, or product, combine news reporting with analysis, thus providing enriched intelligence in a compressed timeframe. With adopting open access resources and initiatives, there is the understandable concern of security. Also, open access resources should not be thought of as replacements for the analysis and "deep dive" coverage that third-party content providers and industry analysts offer. Which leads to my next trend:
Trend #3 - Flexible Content Access Models
Third-party data providers continue to embrace flexible content access models that are more adaptable to individual procurement department budgets. HfS recently noted that "most procurement functions have been cut to the bone in most organizations" in a post about Procurement As-a-Service.3 High quality market research is expensive. Having a single report eat up a large percentage of your department's research budget can be a strong incentive to turn to Google. Buyers are turned off when they have to purchase an entire report, or pay full subscription price, when what they specifically need is embedded in a segment within the report. Market analyst firms that traditionally allowed access only through paid full subscriptions are offering slivers of their research for free and selling reports individually. Even better, there are providers offering content that is retrievable at the segment or table/chart level and you pay only for the segment of data used. An example of this type of provider is research aggregator Profound.
1. "The Open Access/Knowledge Movement: Inspiration for Strategically Advancing Procurement," Cottrill Research Blog, February 26, 2015, http://cottrillresearch.com/the-open-accessknowledge-movement-inspiration-for-strategically-advancing-procurement/
2. "Open Data, Unlocking Innovation and Performance with Liquid Information," McKinsey Global Institute, October 2013, file:///Users/dlj740/Downloads/MGI_Open_data_FullReport_Oct2013.pdf
3. "Procurement Makes Its Move to As-a-Service…. So Who’s Leading the Market?" Horses for Sources, June 21, 2015, http://www.horsesforsources.com/procurement-as-a-service-blueprint-2015
About the Author
Jeanette Jones, founder of Cottrill Research, has over twenty-five years of experience providing corporate business and strategic sourcing research services. Her corporate experience includes establishing libraries with research functions for Arthur Andersen and the IT Vendor Management group at Bank One (JP Morgan Chase) and providing research services for Wachovia’s Strategic Sourcing group. In these positions, she routinely researched and wrote about industry and market trends and events, enabling consultants and procurement professionals to make informed critical decisions.
Ms. Jones recently co-authored a book with Ms. Kelly Barner (Managing Editor, Buyers Meeting Point), published by J. Ross, entitled Market Intelligence for Procurement Professionals: Research, Process and Resources. It details how to develop, execute, and maintain a Supply Market Intelligence program and provides detailed listings of resources that are available for various direct markets and indirect spend categories. She has authored detailed research guides, covering the subject areas of business, supply chain management, hotel management, and casino management. She maintains the Cottrill Research Blog, which provides news and analysis about the latest research and information resource offerings for procurement professionals.