Today's Procurement departments accept new responsibilities and refine their sourcing methods on a daily basis. The evolving nature of their business means they're got to keep track of a veritable dictionary's worth of terms. Young Procurement professionals can easily grow overwhelmed, but they're not alone. Even industry veterans often find themselves perplexed by supply management's ever-evolving lexicon.
Source One's consultants have spent over two and a half decades educating our clients on the value of more strategic, proactive purchasing. In that time, we've seen countless new pieces of lingo pop up in conversation. We've even introduced a few ourselves.
Is your Procurement team in need of a refresher? Here's a quick lesson in the basics from Source One's team.
Audit - Simply put, this means to inspect or examine something to ensure compliance and optimal performance. Source One's Procurement experts offer audit services focused on contract terms and service levels in categories including Marketing and Telecom. Their efforts point out inefficiencies and provide opportunities for cost reduction.
Benchmarking - Conducting a benchmarking exercise provides an organization with the market intelligence and Procurement best practices necessary to assess their operations. Source One's benchmarking services help clients compare themselves to the competition and develop plans for optimizing their internal Procurement operations.
Category Management - Just because a company has abandoned its tactical purchasing processes doesn't mean its Procurement team has reached full maturity. Source One's experts believe the next step for Procurement could be accepting a role as a Category Manager. This will mean familiarizing itself with the goals, objectives, and intricacies of each department within an organization. As Category Managers, Procurement professionals will better encourage both savings and collaboration.
Direct Materials - These are the raw materials that go directly intro an organization's finished goods or support its manufacturing process. Source One's Procurement team offers cost reduction services for direct spend categories including print materials, laboratory suppliers, and textiles.
E-Sourcing - Taking purchasing online, e-Sourcing typically helps companies reduce shorten their cycle times and more efficiently interface with buyers and suppliers. Automating the process can also increase visibility into various spend categories and simplify the contracting process. Source One maintains its own proprietary e-Sourcing tool. Low-cost and low-risk, WhyAbe has impressed Procurement teams for over a decade.
Fleet - These are the vehicles owned and operated by an organization for business purposes. Source One's spend optimization team have clients in various industries optimize the category and even introduce more sustainable practices to their fleet purchasing.
GPO - Group Purchasing Organizations can supplement an organization's Procurement team by leveraging high-volume purchases to produce savings. Source One's team of experts can provide similar services alongside or instead of a GPO. Customizing our services to the individual client's needs, we'll oversee processes ranging from supplier identification to contracting.
Human Resources Services - HR departments perform essential, strategic functions within their organizations. Tasked with optimizing hiring, training, and employee recognition, it's easy for HR departments to grow overwhelmed with their ever-evolving workload. Source One's experts supplement internal HR teams in all industries by developing roadmaps to meet strategic, value-adding goals.
Indirect Materials - This term refers to any spend categories that don'y become an integral part of your organization's products. Source One's Procurement team has the expertise necessary to optimize spend in any area of indirect spend. We've enabled clients to refine their purchasing operations in categories ranging from Marketing to office supplies.
Joint Ventures - An effective tool for mitigating risks, joint ventures are any commercial enterprise undertaken by two or more parties that see them share costs and profits while retaining their own identities. Source One's supplier relationship management team will leverage their years of cross-industry expertise to help establish advantageous joint ventures.
KPI - Key performance indicators reveal the strategic value of a department or specific operation. Source One's Procurement dashboarding experts can help your organization develop the appropriate KPIs for assessing the value of your purchasing team.
Logistics - This indirect spend category refers to the management of business operations including acquisition, storage, transportation, and delivery of goods across the supply chain. Source One's freight and logistics experts enable companies to reduce costs, improve lead times, and routing processes.
MRO - The Maintenance, Repair, and Operations category includes everything from nuts and bolts to specialized engineering services. Often treated tactically, the category leaves many organizations faced with fragmented supply bases and poor communication. The category management experts at Source One excel in helping companies develop a more strategic approach to their MRO purchasing.
Nearshoring - In recent years, many companies have discovered that the costs of outsourcing their operations far outweigh the benefits. Source One excels at helping these companies 'nearshore' their operations by bringing them closer to home. They've proven particularly successful in helping companies relocate to Mexico and Latin America.
Opportunity Assessment - Source One's opportunity assessment team will do much more than analyze your historic purchases. They'll leverage your data to develop actionable savings roadmaps. Whatever your industry, our recommendations and support can help you realize your savings goals.
Procurement Transformation - Purchasing teams aren't what they used to be. Abandoning their tactical, reactive processes, many teams have matured into fully strategic business partners. Not all Procurement teams, however, can reach their potential alone. Source One's Procurement transformation team provide the support necessary for companies to optimize their operations become truly strategic.
Quality Assurance - The supplier performance management team at Source One have the experience and skills you need to ensure your suppliers meet your unique specifications. We'll assess your incumbent relationships, refine your processes, and provide the support to keep relationships on track for the long-term.
RFP - A successful Request for Proposal establishes the foundation for an effective sourcing event. Constructed thoughtfully, these documents help your company obtain pricing as well as detailed descriptions of services and product specifications. Putting together a top-notch RFP gets your company one step closer to identifying a best-fit strategic partner.
SpendConsultant - Too often, Procurement teams address the complicated process of spend analysis by adding more complexity. Source One's low-cost, high-speed spend analysis and opportunity assessment platform removes this complexity. Optimized to Procurement's needs, it makes it easy to identify and act upon savings opportunities.
Training Programs - Procurement's diverse duties require a diverse set of hard and soft skills. Source One's team has spent nearly three decades familiarizing itself with the qualities that make for successful sourcing. They've helped clients in countless industries develop and maintain training programs aimed at building a best-in-class Procurement team.
Utilities - Pricing for electricity, gas, and other utilities can prove both volatile and confusing. Source One's purchasing experts make it easy for clients to navigate this category and build long-lasting relationships with dependable suppliers.
Vendor Management - Source One's Procurement team is full of expert negotiators. We'll embed ourselves within your existing relationships, identify inefficiencies, and work tirelessly to optimize your interactions with vendors. A full vendor management program will not only produce short-term savings, but will also enable your company to produce value well into the future.
Wireless - Wireless services and device management are among the fastest-growing subcategories of telecom spend. For many companies, the spend area is evolving too quickly for effective management. Source One's team has the telecom expertise and dynamic market intelligence needed to reduce confusion and optimize wireless purchasing.
RFX - Borrowing a page from algebra's book, this phrase is a catch-all term for the different documents that might drive a sourcing initiative. Whether you're in need of a Request for Proposal, a Request for Information, or a Request for a Quote, Source One's RFX Design team will set you up for success.
Yield - For Procurement, yielding results means much more than producing cost savings. Today's leading teams know that truly successful operations yield long-term value in the form of optimized supplier relationships, efficient processes, and better spend under management.
Zone Exemption - These discounts are just one of the opportunities that Source One's Sales and Use Tax audit team can uncover. Trust us to analyze your payments. We'll identify lost savings on a contingency-basis to ensure you only pay if we produce results.
Any questions? Call the Procurement experts at Source One. From the ABCs of supply management to the most complex sourcing issues, we've got the know-how to supplement your team.