February 2018

Megan Connell's impact on Source One was immediate.  Joining our ranks as an intern, she soon distinguished herself as indispensable member of the Procurement team.  Understandably, she accepted a full-time position in short order and has continued to advance at an uncommon pace.

Supply and Demand Chain Executive recognizes Meg for her particular success in Marketing procurement.  Unperturbed by the category's complications, she has enabled many of Source One's clients to optimize their Marketing budgets and establish more strategic partnerships with their preferred agencies.

Historically, Marketing and Procurement aren't know for collaborating closely.  Within many companies, Marketing departments still view Procurement as an unwelcome, cost-slashing adversary.  Meg has taken the lead in helping Source One's clients abandon their misconceptions about Procurement's influence and embrace its full value-adding potential.

We sat down with Meg to discuss her experiences as a Procurement Pro to Know:

Source One: What made you choose a career in Supply Management?

Megan Connell: What appealed to me most about a career in Supply Management was that you're able to get a glimpse into how different companies operate. You're not just looking at how they're positioned to the general public, but gaining an understanding into what informs their decision making.

Source One: What's your favorite thing about the work yo do?

Megan Connell: What I enjoy the most about my job is that we get to learn the inner workings of companies of all different sizes, geographies, and industries. Each company is different in how they allocate their spend, how they structure themselves, how they operate, etc. This means the work I do with each client is always different. Even within similar categories and industries we're tasked with customizing strategies.

Source One: In your opinion, what sets award-winning Procurement professionals apart?

Megan Connell: I think what sets leading Procurement professionals apart is adaptability - both to the changing world of Supply Chain Management and to situations they face in their day-to-day responsibilities.

Give Source One a call today to partner yourself with award-winning Procurement consultants.  Together, we'll optimize your purchasing operations and set your company up to win awards of its own.

Procurement's reputation for wantonly slashing budgets still survives within many organizations. As a result, even best-in-class Procurement groups struggle to engage constructively with Marketing. Tired of defending their budgets, Marketing teams are often particularly resistant to interference.  The problem only gets worse when the two departments fail to comprehend one another's goals and objectives.

According to a recent A.T. Kearney assessment, fewer than 20% of Procurement teams consider themselves proactively involved in their company's marketing efforts. Unsurprisingly, changing Procurement's perception and encouraging teamwork promises to be a popular topic of conversation at ISM2018.

In her time at Source One, Senior Consultant Megan Connell has proven uncommonly successful in the Marketing space. Her efforts have helped Source One's clients optimize their Marketing spend and nurture collaboration moving forward. She's been successful enough to earn Supply and Demand Chain Magazine's Pro to Know Award, and she's increasingly regarded as an emerging thought leader. The key, she suggests, is entering stakeholder engagements from a well-informed and respectful perspective.

She joins us for the latest installment of ISM2018: Session Insights to provide her strategies for bridging the gap between Procurement and Marketing. Give the episode a listen today, and be sure to attend Diego De la Garza's ISM2018 presentation: Overcoming Procurement's Internal Image Problem to learn more about communicating the department's value.

See you in Nasvhille.

KFC UK chicken supply caught up in supply chain breakdown

The importance of resiliency in the food service supply chain is an idea that often exists in the industry's background, until those moments when it is suddenly thrust into stark relief. The problems with contaminated ingredients at U.S. Chipotle locations a few years ago were one such event. KFC restaurants in the U.K. have recently experienced another: Due to supply chain blockages, the restaurant chain has run out of its signature protein - chicken.

Chicken restaurants without chicken
As CNN reported, KFC changed logistics providers responsible for deliveries to its restaurants, leaving Bidvest for DHL. The switch has been far from smooth, with delays in delivery popping up. Rather than source its ingredients from other providers, KFC was forced to shutter some of its U.K. restaurants. The corporation took to Twitter to announce that a variety of steps are being taken across the network of 900 eateries in the region. Some are not offering the full menu, while others have temporarily shut their doors.

The effect on staff members may vary from one location to the next due to the franchise-owned nature of 95 percent of KFC's U.K. restaurants. The official corporate policy is to keep paying employees as though their locations were open, with franchisees encouraged to take this same approach. CNN noted that the disruption is especially notable for where it occurred: The British Isles make up the No. 1 European market for KFC.
Today's corporate blunders are often magnified by customers' ability to sound off on social media. The KFC disruption is no different, with CNN pointing out that Twitter users have pointed out their bemusement that a chicken restaurant has somehow found itself unable to acquire any chicken. KFC and DHL have faith the disruption will be short-lived, chalking up the lack of chicken deliveries to
"teething problems" with the new corporate relationship.

Chickens on a farm.What's a chicken restaurant to do when it can't get chicken meat?
Food supply matters go worldwide
Transporting ingredients and finished food products from Point A to Point B has become a more complicated process in general over the past few years, highlighting points of vulnerability in supply chains. The Food Protection and Defense Institute's Erin Mann, writing for Food Safety Tech, described a few of the issues facing stakeholders over the next few years as they attempt to feed discerning customers without ending up suffering disruptions.

Mann noted that there are points of the food supply chain that tend to lack visibility and data access. Ingredients such as spices can end up traveling around the globe before they get to a consumer, and it's difficult for the companies further down the pathway to trace every step the ingredients take. This leads to troublesome scenarios in which it's hard to tell whether suppliers are safe or reliable.
Food suppliers must also ensure they aren't relying too much on any one geographic route to get key ingredients. As Mann pointed out, a single natural disaster could end up preventing firms from delivering their items to consumers unless the supply chain is adequately resilient. These logistical matters, along with food-specific concerns such as freshness and cultivation methods, will keep food industry procurement leaders busy over the next few years.

In just over two years, Consultant Jonathan Groda has distinguished himself as one of Source One's most flexible and valuable assets. With broad category expertise and an inventive approach to Procurement and Strategic Sourcing, he's already earned a number of internal distinctions.

This year, he adds Supply and Demand Chain Executive's Pro to Know award to his list of accomplishments. The award not only recognizes his cost reduction efforts, but also his dedication to refining Source One's proprietary technologies.  Thanks to his efforts, Source One's clients enjoy access to a streamlined, user-friendly spend analysis and opportunity assessment tool.

Jonathan's efforts have helped his clients optimize their spend profiles, and they've helped set his organization apart a uniquely tech-enabled Procurement Services Provider.

We sat down to ask Jonathan a few questions about his life in supply management.

Source One: What made you choose a career in Supply Management?

Jonathan: I discovered a passion for analytic work in my former life as an administrative assistant. I didn’t necessarily “choose” supply management, an opportunity presented itself and I jumped. I could not be more pleased with where I landed!

Source One: What’s your favorite thing about the work you do?

Jonathan: My favorite part of procurement is the people I work with. If we strictly talk about the work, I like the range of projects I get to work on. It is difficult to get bored, I am constantly challenged, and I always feel like I am pushing my comfort boundaries, while learning at the same time.

Source One:   In your opinion, what sets award-winning Procurement professionals apart?

Jonathan: The team they work with.  You MUST be a team player in the procurement world. Second to being a team player, you have to be able to listen closely, work efficiently, and keep your eye on the end goal. Organization and the ability to communicate are also critical skills for success in the field.

Check back in with us throughout the week as we profile more 2018 Procurement Pros to Know.  Interested in building your own award-winning Procurement team? Contact the experts at Source One today.  We'll supplement your internal team with the insights and best practices that have earned us industry recognition for over two decades. 

The race is on. Companies of all sizes, across a variety of industries, are rushing to develop fully strategic Procurement functions. What were once mere purchasing teams are now nuanced units driving enterprise-wide change and dictating long-term strategies. Oftentimes, however, companies find their internal resources insufficient for making the necessary transformations. That's why savvy organizations are continuing to supplement their efforts with the services of versatile Procurement independent contractors.

Contractors aren't a fool-proof answer to a company's problems. They won't show up on-site and instantly initiate the expected changes. Even the best Procurement contractors require considerable investment from the companies they're supporting. In fact, companies will find that contractors require the same level of guidance and support as full-time, salaried employees.

Too often, companies take a hands-off approach to managing their contingent resources. Whether they expect too much of Procurement contractors or demand too little of their own HR departments, they leave their contractors ill-equipped for long-term success. Here a are a few tips for deriving the most possible value from your contingent Procurement resources.

1. Establish a Start Date

It may sound like a no-brainer, but the first step in optimizing a Procurement contractor's performance is establishing a definitive start date. A contractor can't get off to a running start if the starting line keeps moving. Source One's own Procurement recruiter has seen countless engagements fail as a result of indefinite start dates. Failing to set this date in stone communicates a fundamental lack of investment. Companies insist on investment from their contingent talent, but how can they expect to receive it when they can't be bothered to invest in organizing their own calendar?

2. Finalize Your Budget

Again, this might sound obvious. Oftentimes, however, organizations attempt to bring Procurement contractors on-board without reaching an agreement with HR. This is not unlike going shopping without checking your account balance. It's irresponsible, ill-advised, and sets the stage for disappointment. Getting these conversations out of the way early eliminates the possibility of more uncomfortable interactions down the road. Perhaps your company isn't certain what they can afford.  In that case, you may want to consider leveraging the services of staffing consultants. A third-party could bring both the bandwith and lack of bias necessary to accurately assess your companies resources.

3. Communicate, Communicate, Communicate

Communication is everything in managing a relationship with a contractor. A Procurement contractor can't meet a company's expectations unless they've been effectively briefed on what exactly these expectations are. It's important that companies make their contingent resources feel like any other member of the team. That means communicating consistently and enabling contractors to embed themselves within a company's internal culture. This could make the difference when it comes to optimizing a procurement contractor's performance and - perhaps - guaranteeing a long-term commitment.

4. Put Yourself in their Shoes

If there's one thing that might keep a business from leveraging contingent resources it's the (misguided) idea that contractors are somehow disloyal. What these companies should realize is that they can only encourage loyalty by showing loyalty, It's essential that companies attempt to see the on-boarding and hiring processes from the contractor's point-of-view. They need to display the same level of engagement and commitment that they ask of their contractors.

Is your company in need of temporary procurement, supply chain, or sourcing talent? Reach out to Source One's Strategic Sourcing experts today.  We'll help you identify and optimize the resources you've been missing.  Interested in becoming a Procurement contractor? Check out Source One's Career page for a look at opportunities.

ICYMIM: February 26, 2018

Source One's series for keeping up with the most recent highlights in procurement, strategic sourcing, and supply chain news week-to-week.  Check in with us every Monday to stay up to date with the latest supply management news.

Michael Lamoureux, Sourcing Innovation, 2/19/2018
There's no such thing as a free lunch. There's a reason you'll hear this on the first day of any beginner's economics class. It's true. Procurement professionals should be wary of any 'free' platform their team employs. Before growing too reliant on these tools, they've got to ask themselves, "who's paying?" If supplier networks are footing the bill for databases and other software, chances are they're finding ways to pass those costs onto you. LinkedIn, too, should give Procurement teams pause. Companies tend to load their profiles with corporate intelligence that unscrupulous rivals can easily make use of. In other words, free can be pretty expensive.

Sydney Lazarus, Spend Matters, 2/21/2018
Lazarus summarizes a recent Spend Matters webinar hosted by analysts Michael Lamoureaux and Tom Finn. Together, they suggest new categories that could benefit from sourcing optimization efforts. It's no secret that strategic sourcing produces value in the MRO, Logistics, and Packaging. Even relative laggards have seen results in these categories. Lamoureaux and Finn suggest applying the same principles to Marketing, Fleet, Subscriber Services, Legal, Facilities, and Direct Materials. Purchasing in these categories, they suggest, is no different than purchasing in the Logistics or MRO space. Certainly sourcing optimization should produce comparable results. 

Kelly Barner, Buyer's Meeting Point, 2/19/2018
Today's chicken supply chain looks a lot more like a ladder than a chain. Organizations throughout the industry are struggling for their margins and attempting to gain the advantage necessary to reach the next tier. Competitive pressure has led to considerable controversy. Distributors Sysco and US Foods are currently embroiled in a lawsuit with Tyson and a number of other chicken producers. The distributors allege that producers have engaged in collusion and price fixing for over a decade. It's not yet clear how this lawsuit will play out, but it's abundantly clear that such a competitive industry breeds conflict and controversy. 

“Leadership is the art of getting someone else to do something you want done because he wants to do it.”

-Dwight D. Eisenhower

That quote by Dwight Eisenhower has resonated with me throughout my academic and professional careers. Every "good" boss/manager I’ve ever dealt with who I had the most respect for never made me feel as if I was told to do something – I always was happy to do it and wanted to do it well. Whether you realize it or not, whenever you are tasked with leading a group of your peers and/or colleagues, your leadership style comes to the forefront. Project managers are tested day in and day out on their ability to lead while they keep their projects progressing and successfully executing their respective deliverable. Dealing with stakeholders can be enough of a challenge, but keeping your own team motivated is key to any successful engagement.

Fortunately for project managers (young and old) there are ample resources available to help hone in your project management and leaderships skill set. Globally recognized resources such as the Corporate Education Group (CEG) or Project Management Institute (PMI) offer many free webinars and other in person seminars to help today’s project management professionals get better at their craft.  I've highlighted a few key concepts to keep in mind that both organizations often emphasize:

Be Transparent

Nobody likes being kept out of the loop. Your team is the lifeline of the project – make them feel like it! Be clear about expectations, deadlines, escalation procedures, and what the end goal is and how it will be measured. Managing on a “need to know” basis is a dated practice that has no place in today’s landscape. You owe it to your team to keep them informed. Knowledge is power, and the more you share with them the more they have to use to their advantage.

Over Communicate

As a project manager it is your responsibility to have a handle on the pulse of your projects. What better way than to meet with those actually carrying out the execution of each phase. Weekly correspondence/meetings are a good way to avoid any breakdowns in communication and possibly prevent any delays in the project (or at the very least give you advanced notice). This does not mean you need to conduct meetings just to conduct them. How often have you sat in meetings that could have been accurately summarized with a well written email? Save yourself the facetime and let your people do their thing! If conducting a meeting has no true value, cancel it! No need to waste your time and the time of your team.


Listening is a skill that can be applied to almost any facet of everyday life, and is arguably the most underrated asset of any manager. Listen to understand, not to reply. Project management is an ever changing, fluid field. New ideas will help you overcome obstacles and improve your strategy when challenges arise, and who better to fall back on than your team members who are on the ground level who can provide insight that nobody else could.

Whether or not your job title has the word “manager” or “director” in it does not determine if you are a leader. Worrying about the well-being of your peers/colleagues while supporting them perform their job stands out above any fancy title. Superiors who utilize authority as a means to lead aren’t leaders, they’re bosses. I’ve been fortunate to have had good and bad managers throughout my career. No that isn’t a typo – I appreciate each and every one of them. I can honestly say I learned several good traits, and also learned what not to do in several cases. Either way I’m better for the experience, and hope you can apply some of these tips as you continue to grow and develop your project management and leadership skills.

February 23, 2018

Here's a look at where Source One's cost reduction experts have been featured this week!

Source One News:

2018 Procurement Pro to Know Award Winners
For the eighth-consecutive year, Source One is proud to announce that members of its cost reduction team have received Supply and Demand Chain Executive's Procurement Pro to Know Award. This year's recipients include Senior Consultants Kenneth Ballard and Megan Connell and Consultant Jonathan Groda. The three emerging thought leaders are recognized for their forward-thinking approach to supply management and their years of successful client engagements. 

Recent Podcasts:

ISM2018 Session Insights (Episode 1) - Amazon's HQ2 RFP: A Case Study in Sourcing Excellence
Amazon's hunt for a new North American headquarters is all over the news. Recently narrowed to 20 finalists, the hunt commences with an 8-page RFP. Remarkably brief for such a massive project, the document presents a case study in effective RFP construction. Source One Senior Project Analyst Jennifer Engel kicks off the ISM2018 Session Insight series with a discussion of the Procurement best practices included in the HQ2 RFP. Like what you hear? Tune into the Source One Podcast every week until ISM2018 starts in May. You'll hear the Strategic Sourcing experts at Source One discuss the topics that promise to dominate the conversation at this year's conference.

Stakeholder relationships depend on respect, trust, and mutual investment. Source One Senior Consultant Liz Skipor has learned this through years of successful client engagement. Collaborating with Marketing departments has taught her the importance of speaking your stakeholders language and taking the time to listen. She shares these and other insights on the Source One Podcast.

Every company - regardless of size, industry, or location - wants to save money. Too many, however, chase ambitious savings goals without first taking the time to assess their internal capabilities. Source One Director Diego De la Garza joins the Source One Podcast to discuss the importance of conducting maturity assessments before establishing goals. His insights could help your company avoid the depletion and disappointment that come with unsuccessful initiatives.

Each year, Supply and Demand Chain Executive awards its Pro to Know Award to emerging leaders in Procurement and Supply Management. The Strategic Sourcing experts at Source One are proud to announce that this year's honorees include three of our cost reduction specialists.  2018 marks the eighth-consecutive year that members of Source One's team have earned this distinction.

Recognized for their forward-thinking approach and continual success, Consultant Jonathan Groda and Senior Consultants Kenneth Ballard and Megan Connell join a prestigious list of Procurement professionals.  They'll be commemorated alongside other recipients in the March 2018 issue of Supply and Demand Chain Executive's magazine.

"All three of this year's Pro to Know recipients have proven themselves indispensable to Source One's operations," says CEO Steven Belli.  "They not only serve our clients well, but they have each begun to emerge as true thought leaders in in our industry."

Check back in with us next week as we profile this year's winners.
Interested in learning more about what makes for award Procurement services? Contact the industry-recognized consultants at Source One today.

Procurement has evolved. In fact, its evolution is still ongoing and shows no sign of stopping. Departments that once functioned as purely tactical resources are increasingly expected to drive company-wide strategy and produce value beyond cost savings. As Procurement's duties grow more diverse, strategic, and essential many companies find themselves looking for outside help.

Luckily for them, Outsourced Procurement Services Providers have evolved as well. Companies can still delegate purchase orders and shipments to a traditional BPO, but that's hardly the limit of what an outsourced Procurement unit can provide. Today's providers are capable of supporting Procurement's most challenging and strategic tasks.

Check out Source One's latest infographic. It offers tips for assessing the maturity level of your Procurement department and selecting the perfect outsourcing model to support its needs. 

Whether you're looking to hand-off tactical labor or overhaul Procurement entirely, Source One can help. Trust our Strategic Sourcing experts to determine the right outsourcing plan to help your Procurement team perform to its full potential. 

You don't get to be a leading Procurement Services Provider without first building a team of talented and dedicated professionals. Source One's internship program aims to identify and empower tomorrow's industry leaders.  Many of our most successful analysts and consultants joined the team as interns, and we're constantly on the hunt for the next addition to this expert team.  We provide these young professionals with hands-on experience in supply management, client services, business development, and more.  Our close-knit culture and diverse service offerings make for a fast-paced, ever-evolving, and consistently interesting internship experience. Contributing to Source One's efforts from day one, our Procurement interns quickly build skills that will prove crucial in whatever field they choose. 

Say hello to the talented interns joining Source One this spring. 

Hello! I'm Olivia LaRocco, and I'm a student at Loyola University Chicago where I study Anthropology and Economics.  I'm 21, and I'm originally from Greeley, Colorado.  When I am not at Source One or studying, you can find me exploring  Chicago's best donut shops, reading a book, walking the Lakefront Trail, or listening to live music.  I also love to travel, watch The Office, This is Us, Seinfeld, and The Bachelor, and enjoy the outdoors by hiking, biking and skiing.
Prior to Joining Source One, I interned at UBS Financial Services under a financial advisor.  Following my internship, I realized I had a passion for finance and joined Loyola's student managed fund in the fall of 2017 as an analyst specializing in currency and fixed income.  I am now on the Investment Committee for Rambler Investment Fund, and expanding my love of finance and portfolio optimization every day.  I'm also involved in several other grounds on campus.  I serve as the President of the Loyola Economics Forum, a Research in the Department of Anthropology, an RA and a high school tutor.
I came to Source One because I have a passion for problem solving.  I am eager to learn more about a career focused in procurement and supply chain management and to test the waters of consulting. So far so good! I am not yet sure what I would like to pursue post-graduation, but for now, I'm exploring my possibilities and enjoying my time in Chicago!  

Hello friends! My name is Ari Markowitz and I hail from the small state of Vermont, where throughout my childhood, I danced, skied and explored as much of the Green Mountains as possible. After graduating from Wesleyan University in 2017, with a degree in Economics and Sociology, I moved to Philadelphia, keen on finding a position where I could apply my technical research and analytic problem solving skills. I was lucky enough to get the Spend Analysis Internship here at Source One, where I am constantly learning in a challenging, and supportive environment. I primarily support the Data Science team in categorizing spend data and maintaining tables in our central database, but I also assist in data-related programming, data analysis, and administrative support. The multifaceted, dynamic nature of this position ensures that I am always engaged. I believe that Source one will not only teach me valuable technical skills, but will also give me a firsthand view of the strategic sourcing strategies and supply chain structures of the global economy.

Nestled in a small valley, surrounded by lush forests and rolling hills, I spent the majority of my childhood cultivating my creative imagination, and developing a strong affinity to the natural world. One day, I hope to marry these values in the work that I do. I enjoy using tools and skills at my disposal to creatively solve problems, and come up with new ideas. It is this creativity that I hope to pair with my love for nature. I aim to someday work in the green energy or environmental fields where I can apply technical problem solving skills to support and improve infrastructure that is designed to reduce adverse human impacts on the planet. I hope that the particular position of S1 in relation to global markets will allow me an exciting perspective on some of the ways in which human economic activity impacts the environment. I look forward to my time here at Source One, and I am grateful for the opportunity to work with such a dedicated and welcoming team.

Hey! My name's Aarthi Murali and I'm a Master student at Rutgers University majoring in Industrial and Systems Engineering.  I moved to the U.S. a year and a half ago and I currently live in New Brunswick, NJ.  I spend most of my free time listening to music and watching a lot of sitcoms.  I also love trying out different kinds of food. 

Prior to working at Source One, my previous internships were in various product based industries and I worked mostly in the Supply Chain and Logistics departments. Source One is the first consulting firm I've worked with.  I was excited to accept the opportunity.

I currently work as a Business Intelligence intern with the Data Science team, and I'm absolutely loving it.  At Source One, I'm getting exposure to numerous business areas and learning to apply analytics outside of the classroom.  So far, the people at Source One have been friendly and warm which makes it a joy to come to work every day.  My interest in analytics has progressed through the internship.  I hope to continue gaining experience and move forward in the field of Analytics and Data Science. 

Hi! My name is Claire Nguyen. I am a senior at the University of Pennsylvania, majoring in Economics and minoring in Hispanic Studies. I grew up and still live in Philadelphia, but I’m determined to travel one day and have a lot of different experiences. In my free time, I enjoy gaming, watching horror movies, and spending time with friends. I am also a Director of a nonprofit and occasionally take trips to New York to visit our partners

Prior to joining Source One, I interned at a full-service advertising and public relations company as the Strategic Planning Intern. My tasks involved conducting and analyzing market research, performing competitive audits, and developing presentations for new business. Having been exposed to various clients and projects, I became interested in supply chain logistics and what factors go into how companies operate and choose to finance one project over another.

I am really excited to be here at Source One! My experience so far has been wonderful because there is a focus on ensuring interns gain experience in categories that they are most interested in. I feel supported and engaged by everyone here. It has also been exciting understanding and supporting the strategy and execution side of consulting and supply chain procurement tactics. My goal at Source One is to develop my data collection, manipulation, and analysis skills and to apply these skills to understand the structures of companies and industries. 

Want to see yourself featured on this page? Source One's always looking for additions to our industry-leading team.  Visit SourceOne's Careers page to learn more.

What form is sourcing digitization taking?

The move toward strategic sourcing and more intelligent procurement in general can't occur without technology. The truth about this supply chain revolution is that processes have stayed stagnant for years, held back by the fact that there were limits to how much data employees could process and how quickly. With transactions now being handled digitally, the game has changed, and therefore it's possible to view tech evolution and operational changes in tandem.

While new digital supply chain technologies have the power to change organizations' capabilities and approaches to sourcing, not every business has made the leap to these systems. The progress of digital sourcing systems and the solutions that accompany them - such as analytics and artificial intelligence - has been uneven between industries and regions. Industry-watchers interested in the future of the supply chain can check in on the inroads these valuable tools have made.

The gap left to clear
According to Sourcing Journal, recent McKinsey research has revealed a lingering lack of digital elements within some companies' sourcing departments. This disparity can end up tipping the competitive balance between organizations due to the potential power of improved procurement on the bottom line. While leaders in sourcing departments have a strong vision of their future operations, they are not yet confident in their ability to reach such exalted levels of productivity.
The importance of adopting new sourcing processes goes back to one of the most important concepts in present-day manufacturing and sales: Customers' expectations and demands are always escalating. Organizations that get their back-end processes in order and become more efficient and affordable in getting goods into customers' hands stand a better chance of impressing their critical digital-native audiences.

Sourcing Journal reported that respondents to the McKinsey research want to have fast, transparent and flexible supply chains by 2030. These are admirable goals, as increasingly connected customers will be interested in companies that have all three of those characteristics.
Actually making those attributes apply to supply chains won't be so simple, however. McKinsey partner Althea Peng suggested that to become more digitally enabled, supply chain leaders will have to adjust their approaches to partnerships while replacing their tech tools and imparting new skills in their employees.

Servers holding data.What does a supply chain powered by data look like?
Future procurement team members
Getting on board with the digital revolution will mean seeking out workers who understand new ways of working. Writing for EBN, LevaData founder Rajesh Kalidindi prescribed a few abilities that will be common in procurement leaders of the future. For instance, these individuals will understand data and be able to employ analytics processes. This is no surprise, as the data flowing through modern supply chains will be ideal fuel for business intelligence.

As for other adjustments, Kalidindi observed that an analytical approach to thinking will prove more vital than the ability to develop relationships or a history of apprenticeship in the industry. Sourcing and procurement departments powered by analytics - and in more advanced cases, artificial intelligence - will be able to adjust their strategies on the fly and seize value opportunities that would have passed slower companies by. It's natural to expect tomorrow's employees to embrace the processes that will get their departments to such a point.
Time for health care supply chains to feel the e-commerce effect?

The evolution of health care businesses over the past few years has often involved these companies becoming more like organizations in other industries. Due to the essential and literally life-saving work that goes on in hospitals and other care facilities, it can be tempting to consider the medical world separate from general enterprise operations.

That kind of hard-and-fast separation can lead to missed opportunities, however. The latest efficiency-building technologies and techniques changing supply chains in general will make welcome additions to the health care toolkit.

The fact that changes to health care procurement efforts can have a direct effect on patients' care and health outcomes shouldn't make leaders timid about updating their processes. Instead, they should be actively pursuing new methodologies, looking for ways to make their whole organizations better.

Entering the consumer-goods chain
As Spend Matters recently pointed out, there is a major opportunity for hospitals and other care facilities to create more comfortable and safe environments for patients. While the site described the relationship between health care systems and e-commerce goods providers as "conspicuously absent," there is a great opportunity for hospitals to buy from online sellers.

Hospitals that focus their procurements entirely on health care-specific purchasing may not be providing comforting basics for their patients. The experience of receiving care has gained focus in recent years, and this involves providing what Spend Matters described as "a healthy meal, comfortable bedding and a good internet connection."

Recent years have seen the rise of products that blur the line between consumer goods and professional health care investments. Spend Matters pointed to a line of anti-microbial sheets that will be sold to home shoppers via QVC. The products are also available to hospitals, and the manufacturer behind them made sure to establish a contract with a care system during the launch period.

A hospital emergency entrance.Where can hospitals improve their supply chains?
General adjustments needed
Seizing new opportunities to change and improve patient experiences is a concept hospital leaders should seriously consider over the years ahead. Changing sourcing practices to create savings and efficiencies is another such priority, related but distinct. As Healthcare Finance News reported in late 2017, general supply chain spending takes up 30 percent of hospital budgets, making it the second-most expensive line item after paying staff. Using better practices to cut those expenditures is a valuable priority.

The source pointed out that recent research has discovered that some areas of the supply chain are far better at delivering monetary savings than others. Medical-only commodities are fairly set in their prices, with large organizations controlling distribution. Furthermore, pharmaceutical prices are also out of administrators' hands.

The actual products that have highly variable prices, and that can therefore provide bargains, are medical appliances and supplies dictated by physician preference. Supplier representatives may drive costs up by creating direct links with physicians, a practice that has been mostly eliminated when it comes to pharmaceuticals.

However they accomplish care improvements and cost savings, leaders in the medical world should be unafraid to explore possible supply chain changes in the near future. The world of hospitals is becoming more like other consumer-focused inventories, and that means competing and improving over time are core values.

2017 was a huge year for Amazon, and 2018 is already off to an auspicious start for the e-Commerce giant.  Jeff Bezos is now the richest person in human history, the company has surpassed its neighbor Microsoft in total value, and the hunt is on for a second corporate headquarters.  The latter development is particularly interesting and informative for Procurement professionals.

Amazon commenced their search for HQ2 by publicly releasing a Request for Proposal.  Opening the project to every city in the United States and Canada, the document is a remarkably-slight 8 pages long.  Source One's Procurement and Strategic Sourcing consultants have seen significantly lengthier RFPs aimed at office supply purchasing.

Amazon's brevity in proposing this massive project can teach Procurement professionals a great deal about effective RFP construction.  In the first installment of our ISM2018 Session Insights series, Senior Project Analyst Jennifer Engel discusses some key takeaways.  She examines the document and offers suggestions for companies looking to follow Amazon's lead.

Visitors to ISM2018 can count on many conversations regarding Amazon and its continued success. Get a head start by checking out this episode today.
Supply chains that don't self-examine may be weakening over time

Keeping the supply chain efficient and effective is a top priority across industries - and neither as easy nor as straightforward as it may seem. With market variables and best practices changing around companies, it's not uncommon for long-held strategies to fall behind the times.
One of the main problems that can afflict a supply chain operation at a company of any scale and description is a lack of self-reflection. Organizations that lose track of their own operations may end up surprised as competitors take the lead in their industries.

The importance of this kind of active supply chain is only increasing as businesses turn more to their logistics operations as sources of value. Organizations getting strategic and monetary advantages from processes spanning sourcing to delivery will have a natural advantage over others that cannot optimize their operations.

Degrading over Time
As Supply Chain Digest editor Cliff Holste opined in a recent column, a company's order-fulfillment efforts can break down slowly over time, when leaders aren't paying attention. Inefficiency creeps into the fabric of day-to-day practices and damages the organization's ability to generate value, but it accumulates so slowly that the issues are imperceptible until they've caused significant damage. He referred to this symptom with the old idiom "death by 1,000 cuts."

Holste recommended implementing continuous improvement initiatives for every operation from receiving and picking to shipping. If employees are collecting streams of data about all of these processes and working on strategies to make them better, there's less chance of them falling into neglect. Adopting modern tech tools may also help prevent distribution center operations from backsliding into inefficiency. Warehouse management systems and automation have undergone increases in functionality in recent years, and the latest models could be hugely helpful.

As for single variables order-fulfillment teams can use to determine whether they've let their practices slip, Holste pointed to processing time. When a company gets an order, it should turn that around and ship the goods within a day. If the business can't perform quick turnarounds, it's likely time to ask which of its processes is holding the supply chain back, and what step of the process is bogging down.

A labeled shipping package.The last mile is where logistics reputations may be made or undermined.
Expectations in the Amazon era
Supply chain operations that fail to improve are effectively moving backwards, as the logistics expectations of consumers steadily rise. A Lane Report interview with Verst Logistics CEO Paul Verst touched on the demands being placed on companies in light of Amazon's one-day delivery promises. Organizations making, selling and delivering products of all kinds are now in active competition with some of the world's biggest brands, and their ability to tune up their order-fulfillment operations may determine their fortune.
Millennial buyers have spent a significant percentage of their consumer lives with quick and effective shipment options. These young people are becoming primary earners in households and taking purchasing positions at companies making B2B orders. This means organizations whose logistics operations can't keep up with the velocity and accuracy millennials have come to expect may find they've lost their appeal. With transformation everywhere, becoming antiquated is a real risk.

Era notwithstanding, George Washington and Abraham Lincoln may very well have succeeded as Procurement professionals. The Father of our Country excelled at motivating those around him, and his propensity for out-of-the-box solutions certainly provided a competitive edge. Abe proved similarly savvy in high-pressure situations. No schism between departments could ever compare to the conflicts of his presidency. What's more, his legal background would have served the contracting and negotiations process well.

Their strongest asset, however, (at least where Procurement is concerned) was probably their fabled honesty. Our 16th President was upright enough to earn the nickname Honest Abe, and every schoolchild in America remembers the story of George Washington and his father's cherry tree.

Washington probably never said, "I cannot tell a lie." It's equally unlikely that Lincoln, then a general store clerk, followed a customer for miles to provide him the correct change. They're not here to clear the air, so, for the sake of this hypothetical exercise, let's assume both legends are true.

Honesty, transparency, and integrity should define both Procurement's domestic (internal) and foreign (external) policies.

Domestic Policy:

Procurement professionals at every level should feel comfortable engaging in transparent dialogue with their peers.  For managers, this means clearly communicating expectations and providing consistent, honest feedback. Doing so is the only way to ensure that each member of the team understands their role and performs to their full potential.

More junior resources should show the same level of honesty. It's important they feel empowered to respectfully express their true feelings regarding workload, performance, and their perception of the Procurement team as a whole.

Senior leadership, too, needs to pride honesty in their interactions with employees. No member of the team should feel shut off from the company's operations. Professionals at the highest level should ensure that everyone is up-to-speed on new developments, fully aware of the company's mission and goals, and ready to provide their honest feedback if necessary.

Foreign Policy:

External stakeholder relationships depend on honest communication.  With so many services providers out there, an upfront and transparent communication style could be what sets your team apart.

In some companies, Procurement can look like an intrusion. Few organizations like being told to cut ties with their preferred suppliers or make changes to long-standing policies.  Even harsh truths, however, are better than lies. By presenting themselves as honest and trustworthy allies, Procurement can help smooth these transitions and mitigate any push-back.

The same rules of any relationship apply to relationships with suppliers and other external stakeholders. They can't hope to thrive if either party fails to establish trust. Whether you're advising a stakeholder to set more attainable savings goals, offering tips for reorganization, or making suggestions for supply base consolidation, honesty is essential to the relationship's continued success.

Looking for help in your next campaign? Cast a vote for the Strategic Sourcing experts at Source One.  Together we'll help improve Procurement's approval rating within your organization and build a cabinet of best-in-class suppliers.

ICYMIM: February 19, 2018

Source One's series for keeping up with the most recent highlights in procurement, strategic sourcing, and supply chain news week-to-week.  Check in with us every Monday to stay up to date with the latest supply management news.

Michael Lamoureux, Sourcing Innovation, 2/12/2018
Even if your outsourced Procurement Services Provider doesn't tack on hidden costs, that doesn't mean they're delivering the full value they promised.  So-called 'full-service' technologies and  consulting firms often fall short of expectations. No firm or solution can truly offer expertise in every area, but it's important to audit your choice to ensure they come as close as possible. Ensure, for example, that your firm is truly providing expert in-house resources rather than a team of freelancers. Some firms promise expert resources, but will only arm their clients with a few hours of these experts' time. Delegating most tasks to interns and junior resources, they'll leave your team disappointed.

Megan Ray Nichols, Spend Matters, 2/16/2018
As global supply chains continue to grow and overlap, it becomes more and more challenging to develop plans for avoiding risk and responding to threats. In food supply chains, increased globalization presents particular cause for concern. In fact, 77% of manufacturers surveyed cited global expansion itself as a decided risk factor. Spoilage, contamination, and packaging errors all contribute to an unpredictable series of supply chains. Product recalls can have consequences well beyond financial losses, so companies need to perform more consistent quality checks than ever as they continue to expand. A little extra effort could save businesses and even save lives. 
Michael Lamoureux, Sourcing Innovation, 2/14/2018
The Doctor advises companies to remember that sometimes they've already got what they need. Inventory and asset management are essential components of sourcing and value generation. Next time you're looking to upgrade your e-Procurement or S2P suite, make sure it includes an integrated inventory management component. Unused or unaccounted-for assets cost your company money. You're not only missing out on the value they were meant to bring, but in many cases, some of this inventory could be licensed or rented to generate further value.  
Unilever Threatens to Pull Advertising Funds from Tech Giants

It was the threat heard ‘round the world as Unilever, a global consumer goods company with a colossal   digital advertising budget (the second largest in the entire world), used its buying power to demand a safer, more positive digital ad platform from Google and Facebook for its more than 2 billion daily consumers.  If their demands aren’t met, the company promises to invest its digital ad budget elsewhere.  Unilever’s Chief Marketing Officer, Keith Weed, is weeding out the Tech Giants, maintaining his stance that these platforms are no longer safe for big-brand advertising.  The threat has created a palpable sense of fear as Twitter, Facebook, and YouTube have already released statements aligning themselves with this commitment towards ad improvements. 

Although, on the surface, this may seem like a power struggle between big-brand advertisers and the duopoly of the digital ad space, the undertone speaks to the importance of brand integrity.  Today, people average as many as five personal social media accounts, and, according to Adweek, spend an average of 50 minutes every day perusing these sites. That means Unilever’s consumers are inundated with ads every day, and Unilever refuses to continue to debase and dilute their brand with divisive, hateful or false news.  As the demographic becomes increasingly socially conscious, ad agencies expect to continue seeing the proliferation of ethical and socially responsible marketing.  Unilever and several other household names operate with full transparency, leveraging data to build an engaging brand that transcends look and feel and taps into this socially conscious zeitgeist.  CNN released excerpts from Weed’s speech earlier this week. Weed states, "2018 is either the year of techlash, where the world turns on the tech giants - and we have seen some of this already - or the year of trust.  The year where we collectively rebuild trust back in our systems and our society."  Weed recognizes that he and other advertisers need to call attention to the issues at hand since currently they have the leverage; the Tech Giants’ ad platforms are almost entirely funded by the billions of corporate ad dollars.  Facebook, for example, earns 85% of its revenue from corporate ads and videos. 

This lesson in brand integrity and creative vision is also important to the broader Supply Management function.  Ethical supply chains have been a hot topic for quite some time now, and as Procurement and Marketing continue to find their footing on how to best operate alongside one another, it is increasingly more important that Procurement understands the significance of maintaining brand integrity.  Branding shapes perceptions and influences purchasing decisions.  Procurement should continue to evaluate agencies to ensure they understand the core brand and messaging, and can promote products that leave a strong impression on both internal stakeholders and consumers.  This topic will certainly inspire a greater discussion.  To learn more about sustainable procurement, brand integrity and socially conscious marketing, or ethical supply chains, contact one of Source One’s Marketing Sourcing experts today.   

February 16, 2018

Here's a look at where Source One's cost reduction experts have been featured this week!

Recent Podcasts:

A relationship with a stakeholder, like any relationship, depends on trust, mutual investment, and effective communication. Source One Consultant Liz Skipor has learned this through years of successful client engagements and savings initiatives. She joins the Source One Podcast to discuss the importance of maintaining trust and learning to speak your stakeholders' language. Her insights should help any Procurement professional better encourage collaboration, achieve buy-in, and develop strategic partnerships.

Before establishing savings targets, companies need to fully understand the capabilities and capacity of their Procurement departments. Failure to do so could lead to depletion and disappointment as companies chase unrealistic targets. Source One Director Diego De la Garza has spent years helping Procurement team's assess their operations, optimize their processes, and achieve their savings goals.  He joins the Source One Podcast to discuss the importance of conducting a maturity assessment before setting out on a savings initiative.

In every category and industry, Procurement initiatives rely on apples-to-apples comparisons. Maintaining a level playing field for judging suppliers is the only way to accurately assess the strategic value of their goods and services. In Less-than-Truckload Logistics sourcing, such comparisons are particularly hard to come by.  Carriers in this space have developed their own personal pricing and discount structures. Source One Senior Consultant Ken Ballard has proven himself an expert in navigating this complicated category.  He joins the Source One Podcast to discuss his methods for optimizing your LTL purchases. 

Supply chain reorganization battles the 'retail apocalypse'

What happens to a company when a huge portion of its audience decides, en masse, to conduct business in a new and different way? The retail world is suffering through a real-world example of this hypothetical puzzler as online shopping makes entire parts of organizations' established infrastructure obsolete. Emerging strong from the changing focus affecting retail means reacting quickly to not only the changes that have already occurred, but those that are about to.

The supply chain will naturally become the locus of a lot of new practices, with goods traveling along different pathways than they have in the past, and at greater speed. When the dust settles, it seems clear that even the buildings used to house retailers' supply chain operations will likely have changed.

Supplier networks are shifting
Retail companies' supply lines are changing shape, and in many cases, that means shortening. Supply Chain Dive noted that procurement's decades of offshored production have stretched manufacturing overseas, but need for speed and bottom-line benefits have moved production back into companies' home countries and increased the number of regional distribution centers.
While some government policymakers would probably like to claim reshoring suppliers as a victory for tax incentives or political pressure, the news provider explained that simple changes in underlying market forces are actually behind a bulk of the reshaped supply chain map. After all, tax structures and political power can shift in a matter of a few years, while macro-economic trends follow longer arcs.

Companies are thinking about their customer bases, and trying to find fast and affordable ways to get items into their hands. This is especially important in industries that involve custom production. Since there's no way to prepare a customized product ahead of time, any seller dealing in such goods has a great incentive to keep production facilities close to their customers' locations.
The general move toward more supply chain real estate within companies' home markets is ongoing, though Supply Chain Dive noted it's not a workable model for every company. Businesses that examine their current value chains may discover they are already operating at peak value for their expenditure. On the other hand, the time could be right for change.

A forklift in a warehouse.The consensus best location for warehouses and factories is changing.
Real estate patterns emerge
Sellers that haven't yet changed their approach to warehousing and distribution may find they've fallen behind the curve, with increased real estate prices being one potential consequence. Transport Topics reported that demand is high for large plots of land near transportation hubs, with the central New Jersey area proving especially expensive. Organizations are having to make more shipments in the e-commerce era than they did when dealing primarily with brick-and-mortar stores, driving the demand for central shipping centers.

Shifting the shape and focus of the retail supply chain is a complex operation in many parts, and the changing real estate market for warehouses and distribution centers will be accompanied by new digital infrastructure and communication methods. As long as customers are interested in buying physical goods, however, the cost-effective manufacturing and distribution of those products will be a high-level priority for all companies involved in the retail supply chain.

In Procurement, trust is as valuable a commodity as any other. It's both the glue that keeps stakeholder relationships together and the fuel that drives savings initiatives.  Without trust, Procurement consultants and their clients cannot hope to work together toward common goals.

Consultant Liz Skipor joins the Source One Podcast to discuss the importance of gaining and maintaining trust in stakeholder engagements. "Trust," she suggests, "is the keystone to a successful engagement."

Leveraging her years of experience engaging stakeholders and producing savings, Skipor offers her tips for building strategic partnerships and encouraging collaboration.  Speaking the stakeholder's language, maintaining consistent communication, and always coming prepared are all essential components of her method.  She's an expert at the art of supplier relationship management, and these practices have helped her achieve this status. 

Listen to the episode today.  You'll gain new insights into the factors that drive long-lasting, mutually beneficial vendor relationships.