March 2021

 Fleet Management is a nuanced spend category. What seems like the logical purchasing decision can sometimes be proven the exact opposite. Should you buy new or used vehicles, where to buy parts, and many more questions must be answered with real data and spend analysis. However, if the data is not significant enough, or is inaccurate, outcomes can vary. You could be left paying more for your fleet in overall cost than is necessary. If the data is accurate and detailed enough for a wise management plan, then the outcome can save you millions.

A few questions expose themselves as areas of focus for smart decisions stemming from your fleet analytics. Confirm your analytics can answer each or call Corcentric immediately for help!

1. What Is Your Asset’s Total Cost of Ownership (TOC)?

When analyzing your fleet vehicles, there is much more to consider than simply looking at the price tag. Many factors go into understanding the total cost of ownership. Defined as the total amount of money you will put into the asset while in ownership, you must consider the maintenance, fuel-economy, engine size, the environment your business operates in, and more. If only the initial price tag is brought into the decision-making process, or you do not have proper data points to analyze other potential scenarios, then it is simple to see how you could drastically overpay for the asset. 

If answering this question is difficult for your organization, you need to improve your fleet analytics. Corcentric can help. We have over eight-hundred thousand vehicles under management. If fleet optimization is your goal, we provide over 1,200 data points that will show you exactly how to achieve it.

2. What Is Your Sweet Spot?

Knowing when to sell an asset and buy a new one can save you a ton of money in fleet management costs. An asset will benefit your company when running efficiently and economically. Once it goes beyond that “sweet spot”, it will start to cost you unnecessary amounts of money to operate. Each asset will have a different sweet spot, so how do you know when your vehicle has overstayed its operational welcome? Again, fleet analytics is the key.

If this question is also difficult to answer, then you need to improve your fleet analytics. Corcentric has the tools needed to make sure you are not selling early and wasting money or selling too late and burning cash. The data points we use instruct the exact timing of when to sell to keep the total cost of ownership as low as possible. Without this data, the wrong decision will inevitably be made time and time again. 

3. What Are Your Assets Currently Costing You? You're Current State.

Perhaps this should be the first question in this list, however, it is the right note to end on. This question of all the questions is the starting point. If you do not know what an asset is costing you, whether the total cost of ownership or the addends that make up the TOC, understanding the current state is primary. Without this knowledge, you will not know whether you are making misinformed decisions or not. 

To begin any fleet management program, Corcentric will run a cost analysis. With market intelligence gathered from our over 800,000 vehicle fleet, we will compare your current state to other potential comparative fleets. This will show whether your assets current costs are effective or throwing money down the drain. The best part is this analysis is part of the sales process. You will know how effective we are before spending a dollar!

Remember the importance of substantial and accurate data for your fleet analytics. If you have a ton of data points and they are inaccurate, high fleet costs will absolutely ensue. If you have minimal data points and they are accurate, you are not truly familiar with your fleet management current state. But most importantly, remember we are here to help if you would like to maximize your fleet analytics.

Check out my other fleet blog posts

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The need for an extended time and resource commitment usually separates a contract manufacturing (CM) Request For Proposal (RFP) from a similar initiative with a distributor or fabricator.

With a contract manufacturer, what you're really asking for is the formation of a partnership to both review and evaluate all parts at the component level and the assembly of those parts into a fully working product. In that sense, the CM is not providing a component to be used by your manufacturing team, but a fully assembled and tested working finished device through their own supply chain, fabrication partnerships, and manufacturing processes.

During an initiative with a distributor the request centers around the review of a parts list that contains the manufacturer and manufacturer's part numbers along with a qualitative questionnaire to ascertain the distributor's financial stability and ability to consistently provide the minimum order quantities (MOQs), on time, and with the most competitive market pricing.

Similarly with a fabricator, the process centers around component level manufacturing. For example, if you're sourcing machined components the process will include the quantitative questionnaire, but is more time intensive due to the technical nature of the review of part drawings. This may include the review and identification of manufacturing processes, materials, complex geometries, key tolerances, and tolerance stacking considerations.

For machining and milling initiatives a PDF file will usually be sufficient to facilitate initial conversations with the supplier's team and a quote. For initiatives involving injection molding, STEP files with the 3D geometries are usually required to allow for mold and volume of material calculations required for the quote.

For Electronic Manufacturing Services (EMS) for Printed Circuit Board Assemblies (PCBAs) or cable harnesses the supplier will combine the roles of the distributor with the assembler. Thus, managing the supply chain for off the shelf components, fabricating the circuit board, and completing assembly and testing of the circuit board and components. Gerber files and fabrication specifications are also included in these initiatives.

The CM combines the roles of the distributor for off the shelf components and manages the supply chain, with the fabricator to manage production and quality of all components, and the critical role of assembly and testing. They must make sure all components are not only supplied on time and fabricated to specifications, but are also easy to assemble into the final product and function consistently, dependably, and to the designated performance criteria.

Therefore, if we consider a typical medical device, the manufacturing processes may involve supply chain management for off the shelf components, machining, plastic injection molding, PCBA manufacturing, cable harness assembly, assembly of sub-assemblies, and finished device assembly and testing. CMs will also manage certifications and registrations with regional regulatory agencies as well as return and repair services for components and assemblies for the original equipment manufacturers (OEMs).

In our example, the CM is required to provide a substantial time and resource commitment of 7 separate divisions within the company to provide a response to the RFP with a costed Bill Of Materials (BOM). Some CMs will provide a rough order of magnitude quote without resource commitments on their part, but this is notoriously incorrect in most cases.

The RFP with contract manufacturers is therefore focused on building a relationship with the supplier and convincing his/her team of the business opportunity in order for them to substantiate the costs associated with the time commitments in order to provide a response. This requires careful preparation of the technical bid package with the client to make sure all drawings and specifications are included and well organized for each of the CM's teams and an upfront time commitment of the sourcing and procurement team to conduct multiple introduction and review calls with the teams to ensure the opportunity is presented correctly and the CM understands the necessary requirements to provide an accurate and best in class pricing with their RFP response.


As a supply chain professional, you are no doubt aware of the ways in which the business has changed over the past several years, and are likely looking forward to even more seismic shifts in those to come. The question is, what's coming down that road? As the novel coronavirus pandemic highlighted, it's not always easy to predict the future, let alone prepare for it, but it's still a good idea to get the lay of the land as best you can.

Perhaps the biggest issue facing the supply chain today is recovering from the disruptions caused by the pandemic, according to the most recent Digital Supply Chain Survey from the National Association of Manufacturers. For example, 75% of respondents said their supply chains were negatively impacted by the outbreak, but for the vast majority of those businesses (60% in all), the disruptions were relatively minor.

The future of the supply chain is coming. Are you ready?The future of the supply chain is coming. Are you ready?

Nonetheless, 53% of respondents said they are looking at ways to redesign their supply chain processes or have already started implementing changes, the report said. However, fewer than 1 in 4 considered themselves "very capable" of identifying risk in their supply chains, and even fewer — just 17% — had fully integrated their supply chain operations to be fully digital.

Looking at the data
That latter point is something that many pros realize already: A digital supply chain is likely to be highly important for any companies hoping to make the most of the next several years and beyond. Indeed, Gartner recently highlighted "digital business" as one of the three biggest emergent trends that will determine the future of the supply chain sector. Simply put, customers will continually expect that companies give them more insight into where shipments are, and any businesses that aren't in a position to do that could find themselves falling behind the competition.

"Given the critical role of supply chain in ensuring customer satisfaction and experience, much of the digitalization efforts will be on the shoulders of the [chief supply chain officer]," Mr. Burkett said. "This is the greatest transformation of supply chain structures in a long time, and it will not be easy."

Another big trend? The future of U.S.-China trade relations, which isn't exactly on stable ground, and is likely to keep shifting considerably in the next several years. Other uncertainty for the global supply chain includes the continuing fallout from Brexit, among other issues.

Making the right call
The good news is that many companies currently seem to be making strong strategic investments that will set them up for success both now and in the future, according to a recent Kenco poll. For example, more than 80% of industry respondents say they are either investing in supply chain visibility or choosing to do so. Almost 3 in 5 are doing the same for automation and robotics, and more than 40% are ramping up use of sensors for the internet of things.

Certainly, every supply chain organization is different, but the more you can do to understand your needs as the industry continues to evolve, and then act strategically to address them, the better off you will be when it comes to tackling the the next great challenge.


    Supplier Relationship Management (SRM) provides a formalized way of interacting and managing suppliers, that promotes collaboration and innovation. 
In a standard sourcing event, valuable time and resources are spent in both sourcing and negotiating with key suppliers. By continuing the procurement process and managing supplier relationships, your organization can not only maintain, but improve upon any value that as acquired during the original sourcing event, ultimately driving success within your organization.


The main objective of Supplier Relationship Management is to establish mutually beneficial relationships between the organization and its suppliers. However, traditional supplier management focuses on getting the best component for the lowest price. While that mentality may work for certain categories or commodities, it's likely that mindset will translate to a win for the organization, but a loss for the Supplier. Today, integrated supply chains need to expand their thinking and explore alternative ways to support the business. By properly managing supplier relationships, your strategic partners can operate as an extension of your organization.


With that in mind, how do we unlock the value of SRM within your organization? Supplier Relationship Management practices should complement and enhance both supplier performance and contract management activities. If managed properly, a comprehensive SRM can result in, cost reduction, risk and performance management, and program advisory.

  • Annuals savings can be identified beyond the traditional cost reduction tactics, such as contract restructuring, process improvements, and/or demand management.
  • Performance can be properly managed by providing transparency into your service level expectations and key drivers to meet defined business objectives.
  •  Mitigate supplier risk by establishing tools and processes that provide visibility into the enterprise-wide view of the supplier relationship. 
  • Increase collaboration and foster continuous improvement with strategic suppliers at an executive level by building cross-functional and executive relationships.

Once goals are achieved the program can successfully enter a maintenance phase that ensures the supplier is being managed properly, thus securing the benefits delivered to stakeholders and customers.

If there's just one thing any logistics company should always be interested in, it's finding ways to streamline how materials flow into and back out of their facilities. A smooth supply chain is critical to effective operation so you can both plan for months down the line and react appropriately to any potential hiccups you encounter.

Of course, anyone who works in this industry knows there's a big difference between knowing where you want to get when it comes to optimized supply chains and actually getting there. The first thing to do when making the attempt, however, is to look at how you operate — rather than trying to control what others do, according to Business 2 Community. You need to make sure your logistics and warehousing operations are running at paramount efficiency on a consistent basis. There may be things you are doing that worked well for you a year or two ago, but which are no longer applicable, or at least have become less successful for you over time.

Keep close tabs on your data to maximize your supply chain efficiency.Keep close tabs on your data to maximize your supply chain efficiency.

This means you will want to keep up with your KPI collection and analysis and see where things have potentially gone off course more recently, the report said. When you can identify shortcomings as they arise and regularly move to correct them while they're still relatively low-impact, that allows you to remain strong as an organization even when change is needed.

Making connections
Once you have a more established process for keeping things in order under your roof, it's time to look outward and consider the ways in which your current supply chain efforts are on point, and where there's room for improvement, according to Inbound Logistics. This will often start with making sure your partners are giving you as much visibility into their operations as you need, and finding alternatives if those partners can't deliver what you need. Data drives the supply chain more so than ever before, and if other companies can't keep up with your needs, there is bound to be someone else out there who can.

While you may not want to burn a bridge with a long-time partner, it's important to remember that business isn't personal and in this industry in particular, there will be a greater push for visibility across the board in the years to come.

Stay on top of everything
Finally, it's important to keep in mind that there's no one-size-fits-all approach to logistics and the things that currently work for your company can't be counted on to last forever, according to The Balance Small Business. Consequently, you need to be able to keep tight controls on your inventory, plan procurement around projected demand and regularly strategize with your supply chain partners to ensure that you're always prepared for the next potential shifts in the sector.

The more you can do to stay on top of all these issues, the better off your business will be in the long run. It's not something you can devote only a portion of your attention to; you need to be highly aware of these cause-and-effect situations continually.

If your company is in a position to hire procurement professionals this spring — either to work as part of a broader department or a dedicated purchasing team — you have plenty of things to consider. Perhaps most important will be what that hire brings to the table not in terms of qualifications, but the so-called "soft skills" and related qualities that will help them succeed, and give your company a boost.

What are some of the best qualities to look for? We have some suggestions:

1) Good communication skills

First and foremost — in just about any job these days — you will want your hire to be able to communicate quickly, easily and effectively across all channels, according to IndustryWeek. Whether it's in a team meeting, informal sit-down with supply chain partners, over the phone or via email, you want anyone you hire to always represent themselves and the company as well as possible. Fortunately, you should get a good feel for these kinds of skills throughout the candidate review process.

Make sure your net procurement team member has these skills.Make sure your net procurement team member has these skills.

2) High-level organization

This one is a bit tricky to nail down, but it would be wise to make sure you can count on any procurement pros you hire to be extremely organized, IndustryWeek said. While it's sometimes an unavoidable mishap, you don't want any important details to slip through the cracks because someone missed an email or didn't have accurate data to review. Being able to identify these issues before they're even issues in the first place comes naturally to highly organized people.

3) Analysis

Supply chain professionals have to juggle a lot of information all the time, keep track of what it means, and leverage it to make the best possible decisions about what to do next, according to Michigan State University. Deep, preternatural analysis skills will be critical to ensuring ongoing success, whether they're handling things for just one department or your entire business.

4) Tech familiarity

It should go without saying that just about any employee today needs to demonstrate technical proficiency of some sort, but for procurement professionals in particular, it's vital, Michigan State University advised. They should be familiar not only with industry-related technology in general (especially when it comes to data sharing with supply chain partners) but with the programs you use in-house to keep everything running. That way, when issues arise — as they no doubt will — this new hire will help ensure the problem becomes easier to navigate.

5) Speaking and persuasion

Finally, while this is very much a part of communication abilities, your next employee will need to be highly skilled in the art of talking to other people to persuade them effectively, according to Career One Stop. The ability to get a supply chain partner to put a priority on a necessary shipment or reduce the price per unit of an order will help ensure they continue delivering value for your company for many years to come.

One of the things that can really help your company take a step in the right direction when it comes to efficiency and clarity is by centralizing your procurement efforts. Too often, though, companies silo off purchasing to their individual departments, meaning that each team orders what it needs. That leaves you with a classic case of one hand not knowing what the other is doing, potentially costing more in terms of dollars and time.

However, by centralizing these efforts, you can make sure you get what you need, when you need it, all at a price that makes sense. Leveraging unique procurement skills and relationships can go a long way, but how do you achieve it? We have some suggestions:

Crunch the numbers

One of the big reasons your organization might not have a dedicated procurement department is if leaders don't fully understand the value in making this (potentially drastic) shift, according to Procure Desk. As such, it's important for stakeholders to examine past procurement efforts and see where time or money could have been saved along the way. The odds are good that, when you take a top-down view of the effort, you'll find plenty of areas where you can increase efficiency.

Get the right organizational buy-in for centralized procurement efforts.Get the right organizational buy-in for centralized procurement efforts.

Find common suppliers

Perhaps the easiest way to identify these issues is by looking at the suppliers you have relied on for all your purchasing in the past, and see where there's overlap, Procure Desk added. Once you identify areas where you can consolidate at least some of your orders, you can start to pick up steam and build strong positive momentum. Of course, not everything is easy on this front, and sometimes it's impossible to nail down a small number of suppliers for everything your company needs, but a little effort here goes a long way.

Compile the right team members

Often, if you have multiple departments handling their own procurement needs, you either have talented, trained purchasing pros working more or less on their own, or people making orders who aren't fully qualified to do it — and that can be a problem, according to Supply Chain Game Changer. You either need to commit to having all those people in the same room, or hiring people who will get procurement efforts right the first time.

Set expectations

You can't reasonably expect your new centralized procurement team to get everything up to fully ideal operations within days, weeks or potentially even months after it is assembled, Supply Chain Game Changer advised. Instead, building that sort of efficiency takes time and all involved need to be aware of what it will take to get to the top-level projections you laid out early on.

Leverage technology

Finally, if you have not made the proper investments in the latest and greatest procurement tech that suits your organization's needs, you're not setting your team up for success, according to Scan Market. Research and the financial backing to get it exactly right will lay the groundwork for success that could last for years or more.

As a logistics business, you need all the information you can get your hands on so you are consistently hitting all your preferred KPIs, but you may not be doing enough to ensure you actually have it. Often, this is a problem of businesses that "don't know what they don't know" — or rather, thinking they have all the insight they need when, in fact, could be doing much better with more data.

Indeed, many businesses say they don't really have solid insight into their supply chains because of a lack of visibility around data and partners' functions, according to a recent study from the Economist Intelligence Unit commissioned by The Association for Supply Chain Management. In fact, more than half can really only monitor their own data as a means of understanding supply and demand in their portion of the supply chain. This is a problem given the difficulties the sector suffered in the past year-plus.

Make sure your data insights are aligned with what your partners are doing.Make sure your data insights are aligned with what your partners are doing.

After all, if companies cannot reasonably predict when their supply chain partners are facing difficulties, they cannot plan for those disruptions in-house, setting off a domino effect of potential issues, the report said. Fewer than 3 in 5 companies examined in the study even had contingency plans that would allow them to quickly and easily navigate new disruptions.

"While each industry faces unique supply chain dynamics, in a time of increased turbulence it has become critical to reconsider the balance between efficiency and resilience," said ASCM CEO Abe Eshkenazi.

Getting up to speed
The good news is these problems can be relatively easy to overcome if supply chain partners work in a more coordinated fashion, and data-sharing plans are constructed to the benefit of all involved, according to IoT World Today. Furthermore, modern technology and the shock to the system that sprang from the extreme negatives of the novel coronavirus pandemic can be used to improve everyone's stance on this issue.

Put another way, the disruptions of the past several months or more should be proof enough to even the most skeptical of partners as to why end-to-end visibility is so important, and more companies are now working to be more accommodating as a result, the report said. This is a trend now seen in a growing number of industry surveys, and should continue for some time to come.

More need for insight
There are, of course, more issues to supply chain transparency than just the ability to understand where everyone is at with their own internal operations, according to Drapers. At the same time as this is happening, many companies are also trying to increase transparency for more altruistic purposes, so that unethical treatment of workers or unsafe sourcing can be eliminated. This can help reduce potential regulatory compliance issues and reassure partners and consumers alike that there's nothing to be concerned about.

Now is certainly the time for businesses to align their strategies on data collection and sharing. In doing so, everyone has a better chance to get on the same page and react collectively to potential struggles in a way that minimizes their impact on operations.

Like any business overall, or just a team within one, your procurement department has to be highly aware of its data security posture on an ongoing basis. Mopst organizations simply aren't doing enough to protect themselves on this front and your team may need to be far more proactive about dealing with these issues.

How can you do that? The following suggestions should help:

1) Make sure everyone knows about new purchases before they're completed

Especially if you are bringing a new supply chain partner into the fold for your operation, it's critical to make sure all other departments at your company are set up to deal with them appropriately, according to ISACA. In most cases, being extra-cautious about this sort of thing is just due diligence, but sometimes through no fault of their own, supply chain partners can increase your risk of a data breach, and everyone should be apprised of how the partnership could change the landscape.

Is your supply chain data sufficiently locked down?Is your supply chain data sufficiently locked down?

2) Put together a list of everyone who will be involved

Along similar lines, it's always a good idea to make sure everyone who will be a stakeholder in your supply chain and procurement operations is logged in a shareable online document so there's no confusion about who's dealing with what, and when, ISCACA added. With this information in hand, it becomes far easier for people to manage the data security risk.

3) Understand your vulnerabilities

When you know the various companies with which you may be sharing data, it's easier to identify risks both internal and external, and to react to them appropriately, according to CSO Online. Of course, this is not a set-it-and-forget-it proposition; you will need to ensure you are constantly assessing threats and taking steps to mitigate risk on an ongoing basis.

4) Make the right security investments

With the above in mind, you will be able to get a clear understanding of where you may need to make changes to your internal software setup, around things like data sharing, antivirus programs, firewalls and so on — all of which should align to ensure cybersecurity concerns are kept to a minimum, CSO Online said. When you have the right programs in place, even major threats can be kept to a minimum.

5) Get as much visibility as you can

Once you have addressed your own potential security shortcomings, you should also reach out to your supply chain partners and work with them to do the same for their operations, according to IndustryWeek. The greater your understanding of security up and down the supply chain, the better prepared you will be when risks do arise.

6) Have contingency plans

It's important to keep in mind that no security plan is foolproof and even if you've invested millions, just one small misstep or overlooked detail can bring about a costly data breach, IndustryWeek advised. For that reason, you need to have a response plan for all kinds of different breach contingencies so you are always reacting appropriately.

As we wrap up the first quarter of 2021, it’s still not too late to consider some goals and objectives for your organization to finish out the year, and with trends pointing towards more and more initiatives surrounding diversity perhaps now is the time to consider a supplier diversity program. 

Whether the need for a defined program is coming from your clients or other regulatory requirements, a policy may not always be the best place to start. Consider the lift and efficacy of a newly drafted policy and consider the question: Am I ready for a supplier diversity policy just yet?

While policy may seem like the logical place to start when building out your supplier diversity program, you may actually be jumping ahead a few steps and discover further down the road your policy isn’t quite the right fit for your program. Consider building out your program from the ground up, with emphasis on defining what your program is or will be, what is in scope for your policy, and how your policy governs your program. If you spend time and effort drafting a policy that doesn’t accurately speak to your program you have only wasted valuable resources that could have spent time researching and developing your program. Recommended first steps are defining requirements, stakeholder interviews, or building out a RACI for the specific roles within your program before defining any processes or procedures for your program.

Once you have a detailed list of roles and responsibilities associated with your program, now may be the right time to consider the procedural duties for your program. If you have an established procurement procedure, start here to highlight the areas where new diversity requirements can be implemented (workflows and diagrams are a great way to visualize your process and procedure and begin to whiteboard opportunities for diversity involvement). Understanding what steps will satisfy your diversity requirements can make implementation easier, especially by limiting additional steps that may be perceived as bottlenecks. Communication will also be key when implementing your program, so be sure to consider how and when you will be inserting your diversity procedure into existing processes and be prepared to handle any resistance or feedback if changes are significant.

After you have established what some of the tactical work will look like, consider any technology or support needed to implement this initiative and start to engage the proper teams to begin your actual build. This may mean engaging your procurement, finance, or risk partners, or it may mean working with your system administrators or IT teams to begin implementing the necessary supplier information management (SIM) components. The ability to sort, filter, classify, and manage your suppliers will be vital when building out program, especially when considering Tier I versus Tier II reporting. Try to limit the number of manual processes needed to satisfy any program requirements so a large portion of this work can be automated through proper channels.

If you have defined your program, established requirements, and have a clear path ahead how you will manage your program and supply base, you may be ready to dive into policy development. This ultimately should function as law for your program, so be sure to plan a proper rollout and implementation for your program and how you communicate and disseminate your policy. Use the first few months of a new program to measure success and try and coordinate with a review of your policy so you can properly update. As a final recommendation on policy, be sure to include a change log to monitor and track any edits to your policy. If you find yourself having to edit over multiple iterations, revisit some of the previous steps in your program development to see if you are missing important components in your RACI or defined roles and processes.

While it may be tempting to start with policy, be sure to have all requirements and responsibilities documented, as well as a defined “happy path” for your program before jumping ahead to policy drafting. This can help ensure you have a robust policy that speaks accurately to your program instead of a policy of wish list items of how you want your program to work.

When any new president moves into the White House, they often issue a number of executive orders that allow them to start laying the groundwork for their vision of the next four years. For President Joe Biden, a number of these orders have been focused on shoring up and securing the supply chain in a number of ways, and that includes a new order announced in late February.

The EO calls for "resilient, diverse, and secure supply chains to ensure our economic prosperity and national security," according to the White House. It specifically cites the need for increased manufacturing within the U.S., across a number of different things the country needs, with "built-in redundancies" as well as "adequate stockpiles" and stronger digital networks.

Another clear focus of the order was the need to staff up within the supply chain, increasing employment and also ensuring those jobs pay well.

The Biden administration is giving the supply chain plenty of attention.The Biden administration is giving the supply chain plenty of attention.

Getting started
Of course, it will take significant ground work for the federal government to fully understand the shortcomings facing the national supply chain, and as such, the EO institutes a 100-day review of potential vulnerabilities within that framework, according to a fact sheet about the order also issued by the Biden administration. In particular, this will include reviews of the national pharmaceutical, mineral, semiconductor and large-capacity battery supply chains.

Beyond that, a year-long review of other key industry supply chains will also take place, convening consultations with relevant stakeholders — including "those in industry, academia, non-governmental organizations, communities, labor unions, and State, local, territorial, and Tribal governments" — to ensure more is being done to address these risks and make sure all bases are covered.

Going in the right direction
The good news for the Biden administration is that improving the supply chain has a broad base of bipartisan support within the halls of Congress, according to the Washington Post. As such, once these reviews are completed, it may not be all that difficult to institute some of the necessary changes recommended after the reviews, which will allow the country to get on better footing. Of particular concern may be the fact that a 100-day review leaves a lot of runway before recommendations can even be made, let alone enacted.

However, the goal here is to reduce the American reliance on complicated international supply chain for vital items like semiconductors used in auto manufacturing and ingredients used in the mass production of pharmaceuticals, the report said. Currently, the U.S. relies on China for many of these items, leaving the nation vulnerable to the ups and downs of a nation halfway around the world.

With all this in mind, those within the logistics sector would be wise to keep an eye on developments around these reviews and the recommendations that come out of them. Doing so may allow companies to do a better job of handling the potentially seismic changes that may be coming to the supply chain in the months and years ahead.

Days Payable Outstanding is a key Accounts Payable KPI when done right
Days Payable Outstanding (DPO) is a key AP metric used by many organizations that relates to the entire business. Unlike other KPIs like invoice cycle times or invoices per AP staff FTE, The DPO number can have major ramifications to cash flow and the amount of financing required to keep a business propped up. There are many benchmarks out there that say what a “good” number is for DPO, including “best-in-class”, but it neglects to fully look at the 3-part harmony required of other metrics in order to achieve that key DPO.

Unlike a lot of other metrics, Days Payable Outstanding isn’t necessarily better the higher or lower it is. Too high, and it can start to irk suppliers. Too low, and you’re sacrificing cash-on-hand. So where is the good middle ground? To get there, we need to look at 2 other metrics

A high DPO is bad if you aren’t paying your vendors on time.

Before even contemplating whether your Days Payable Outstanding is strong, you need to know what your on-time payment percentage is. If you are below 90%, there likely needs to be an initial focus on improving that percentage, including confirming how close to the due date on-time payments are made (hint: the closer the better when it comes to improving DPO).

Skipping this step likely means improving the DPO at the expense of supplier relationships. While it may give short-term rewards, it will cause long-term problems when suppliers start tightening charging late fees and reducing payment terms.

Don’t forget to consider vendor payment terms

Speaking of payment terms, you may be paying your vendors on-time, but how good are your payment terms? Are they aligned with what similar companies are receiving from that vendor? While payment terms benchmarking has many variables that makes it difficult to provide a flat “x days is ideal” answer, if your vendors consistently accept your offered payment term without pushback (or if you just accept their default terms), then there is likely room for improvement.

Getting longer payment terms enables you to increase Days Payable Outstanding. You may even be willing to sacrifice your DPO a bit if it means getting early payment discounts. We have negotiated surprising payment term increases with little pushback, although the number one consideration vendors will make is whether you pay on-time, hence why it is key to get that house in order first.

How to calculate your ideal DPO number

Once you confirm your vendors are being paid on-time and you have negotiated strong(er) payment terms with your vendors, you should calculate your target Days Payable Outstanding as the average payment term for your spend, subtracting 2-3 business days (assuming you are paying with ACH or vCard, more if you are mailing a check).

Note that I didn’t say to average out the payment terms across vendors, you need to consider spend per vendor in that average. Consider a hypothetical company that has only 2 vendors: One at Net 30 and the other at Net 90. Someone might look at that and think the average payment term is Net 60. However, if Net 30 vendor gets $10 million of spend per year and the Net 90 has $1 million, the true average payment term when factoring in spend is 35.5 days.


Increasing Days Payable Outstanding can be one of the few metrics that show AP is successful beyond processing invoices and can help justify the department’s costs, but it requires looking at it strategically from multiple angles. Trying to increase DPO without carefully taking in the other aspects above may have short-term success, but long-term harm to the company’s reputation.

The novel coronavirus pandemic caused many companies — in all industries — to reevaluate their operations and find ways to make themselves more agile and adaptable in the face of an increasingly complicated business world. For those in the logistics sector in particular, however, the options to do so include whether to beef up their storage capabilities or continue with a just-in-time lean inventory.

While many companies learned some hard lessons throughout the pandemic thanks to disrupted supply chains and difficulties in connecting with both partners and customers, there's no single clear path forward for how the industry will operate in the future, according to Supply Chain Dive. A recent Gartner survey shows that despite the challenges faced throughout the pandemic, 46% of companies don't have a plan to expand "safety stock" within the next two years. However, that compares with the 43% that are actively trying to do so now, and 11% that will take such a step over two years.

Is single-source inventory working for you?Is single-source inventory working for you?

This may be because relatively few believe having extra inventory on hand is actually an indicator of resiliency, the report said. Only 21% felt that this was the case, putting safety stock firmly behind the 43% who felt this way about avoiding disruptions to fulfillment cycle times, 40% who looked at positive feedback from consumers, and 36% who eyed perfect order fulfillment rates.

What it takes to measure up
As companies look at their options for increasing stores of items they rely on, an option that will likely serve businesses on either side of the "lean inventory" decision well is diversifying their sourcing efforts, according to Source Today. This was one of the hard lessons of the pandemic: When companies relied too heavily on a single supplier or an overly complicated supply chain, they were far more likely to face difficulties and disruptions, but those that were able to leverage relationships with multiple suppliers probably fared a lot better on balance.

There may be many reasons to only tap a lone supplier for ongoing business needs, but all those perceived conveniences might not matter much if there is an issue (large or relatively small) that ends up setting the supply chain back, the report said. Companies therefore might need to do more to walk that fine line between a streamlined relationship with a single supplier and sourcing from multiple businesses.

Getting it right
These days, even single-supplier relationships are becoming more complicated, according to Carter Logistics, and therefore companies may feel disincentivized to seek out multiple suppliers for any given needs they have. However, the opposite is probably true: If these relationships are complicated, they're also easier to disrupt or, indeed, recover in the wake of a disruption.

For these reasons and more, companies would be wise to examine their ongoing needs and come up with contingency plans that they can tap in the event of a disruption. By doing so, they may be setting themselves up for long-term success no matter what difficulties they face in the months and years ahead.

We all have had that mishap during, or just before a big client presentation...

Have you ever referred to a client by the wrong name?

Have you ever shown a presentation and dang there it is - you forgot to change the client name on a slide?

Have you ever suddenly realized the presentation you are referencing is above the baseline knowledge of your audience? (because they are all glassy-eyed and asking very basic questions or worse not asking any questions at all!)

Have you ever gone to the restroom after a presentation and there it is staring you back in the mirror - food between your teeth!

Have you ever gotten to a meeting and are unable to find the version of the presentation you fine-tuned in the wee hours of the morning isn't at your fingertips when you charge up your laptop?


Worse, maybe just prior to the meeting, coffee spilled, or food stained your shirt...

Mishaps & Mistakes will happen!

Some mishaps & mistakes can be avoided with planning (and common sense):

Choice of language - what does that acronym stand for?
What does "DOA" mean to you?
In a move that must have been unsettling for thousands of Iowa's seniors, the state changed the name of its Department of Elder Affairs to the Department on Aging, or DOA, in 2009. Something is telling us that the change has not helped Iowa's elderly sleep any easier. The organization now goes by IDA, for Iowa Department on Aging.

For instance what do these acronyms mean to you when read or heard?
  • IM = instant messaging, Internet marketing, input method
  • IP = intellectual property, Internet Protocol
  • MS = Master of Science, multiple sclerosis, Microsoft
  • SME = subject matter expert, small and medium enterprise
I suggest in visual presentations (using parentheses), write out what each letter in the acronym stands for, do not assume everyone knows the nomenclature.

When reaching for your beverage does your arm cross the view of your camera?
If your mug is to the right of your computer (if you are right-handed) then there will be no visual interruption of the meeting in progress.

What does your mug or shirt advertise?
I was on a virtual meeting with a client late last year and his mug advertised the former company he worked for. On another call the mug held by the vendor advertised a political figure running for office.

Do you have the correct picture angle?
Most providers have a “preview” mode for your visual check and a sound quality check prior to entering the meeting. Take that moment to confirm the angle is accurate. This is a check to confirm the camera is not aimed looking up your nose or focused on your forehead.

Are your cords tangled?
I had small desk and a long headset cord, and it often dangled... The cord would be partially on the floor and the dog, she would sit on it. I would go to move her, and then her paw would get tangled... and of course always happen when I was running late, yes running late to a virtual call! (now I have a hook on the wall and hang it up when not in use.)

What is your light source?
We all look better in good light. With the camera facing you – if you can sit facing a window or with a lamp in front of you will look your best. If the light shines from behind, you will be in a shadow and your face will be difficult for others in your conversation to see you.

Where are the kids? dog? or cat?
We accept (and expect) the interruption during a meeting. I suggest at the beginning of the call just let the other parties know - my child, the dog, the cat may interrupt.

For me it is a 17-pound Shih Tzu ... if the doorbell rings or the community maintenance people are mowing the backyard - she goes NUTS... barking, running, barking louder... I must take my headset off and put her on my lap, and she calms down (she is never in view for those on the call with me).

 Ceiling Fans - Do you use one? Do the spinning blades appear in your screen shot? So, you are thinking, the room is warm, put on the fan, you are wearing a headset - so no noise problem... perhaps this is not true. You may be creating a visual distraction.

I have a client who puts his fan on high (it spins very fast) and even though there is no noise with the angle of screen it is a mesmerizing distraction!

It could only happen in Florida:
Without realizing before the call there was a gecko (tiny lizard) on my skirt. With a glance down, there it was walking on my lap and of course my first reaction was not calm - out of my mouth mid-sentence was a yelp...this was followed by me jumping out of my chair to fling it off my skirt... which of course set the dog in motion to chase, bark and stomp it to death!

A true story - 25 years ago:
I was in my third trimester, going to a client location.  During these last few months I couldn't see, forget about reach, my feet.  All my shoes were flats and I rotated three pair - white, beige and black.  I had no clue until I walked past a mirrored wall at the client location that I had been wearing one white and one beige shoe for the past 4 hours!  I decided at the end of the long day right before our goodbyes to thank them not just for their time but for not making me feel uncomfortable with my accidental choice of footwear.  I explained I didn't own a full length mirror but would be stopping on my way home to purchase one.  The women who were with me all day each acknowledge they had done the same thing at least once during their pregnancy and a laugh was shared. 

Mishaps and mistakes will always happen how we prevent them or handle them in the moment is the key to great customer relationships..

The “Corcentric Virtual Lunch Bunch” meets the last Friday of each month at noon …virtually of course. Would you like to join us? Our next meeting is March 26th at noon.

If you would like to join or wish additional information, please contact me ( – all are welcome to attend and/or be a guest speaker on a topic related to working remotely.

The group does not promote or sell business services. The focus revolves around work at home topics/challenges and how to overcome them.

Companies in any industry should always strive to make sure their employees have the skills they need to do the job in the most effective and efficient ways possible. That certainly includes the professionals on your procurement team, whose success in dealing with others both inside and outside your company can either ensure long-term success for your entire organization, or set it back significantly.

With that in mind, you might be wondering which skills you would be wise to build up in your procurement team; we have some suggestions:

1) Build and maintain supply chain relationships

Perhaps the most important single aspect of working in the supply chain is being able to keep many different plates spinning at once and fully aligning every external issue with your internal needs. To do that effectively, you must have strong communication skills and a personable approach, according to Blue Ocean Academy. Building up these qualities in your procurement team should be the first thing on any training list.

Training can go a long way for your procurement team. But where to begin?Training can go a long way for your procurement team. But where to begin?

2) Make sure they're expert negotiators

Along similar lines, you need your team to be able to advocate for the things your company needs and not be "pushed around" by competing interests, Blue Ocean Academy added. Negotiating to find the best solution that works for everyone will help ensure ongoing success, and this too is a skill that needs to be built up over time.

3) Set them up for success

Because the procurement team is the hub around which many aspects of your business likely rotates, your staffers need to be able to get projects off the ground effectively, according to Vendor Centric. That means they may need new skills that help them become more prepared to plan strategically and then take the right steps to ensure the initial phases of that plan go off without a hitch.

4) Teamwork makes the dream work

Much like your team needs to be able to talk to their counterparts with other companies effectively, they also have to be able to collaborate with each other, and with the people who work in different departments at your company, Vendor Centric said. Put simply, you need your entire organization to be aligned on your procurement strategy, and that starts with internal coordination, empathy and teamwork.

5) Always finding ways to improve

Ideally, your employees will always be looking for ways to make their own work better and more efficient, and that takes some strategic thinking, according to Concord. You want your procurement team to be able to look at their past work and step outside themselves to be honest about what's working, what isn't, and how best to simultaneously lean into the former and reduce the impact of the latter.

6) Understand developing tech

Finally, your workers should never be in a situation where they can't understand the new software or hardware you're introducing into your procurement processes, and training is the best way to get there, Concord advised. When workers have the time and bandwidth to get a real feel for new tech, everyone benefits.

 As summarised in my previous blog here, building a very strong partnership with your suppliers is one of the key steps towards being a resilient organisation. In this blog, I will try to detail some of the steps one can take towards building a mutually beneficial partnership with suppliers.

Procurement is reliant on suppliers. You can run a procurement organisation without people, process or even technology - albeit not well, but you cannot run a procurement organisation without suppliers. As such, I consider suppliers to be a founding stone for procurement - if procurement were, say, a building.

With the changes and volatility that we are experiencing in the market in recent weeks, it is now more than ever imperative to build an ecosystem where transparency is the key in the relationship with your suppliers; supplier, contracts, category management and even sourcing is no longer about driving savings, efficiency, quality alone. It is also how you inculcate a relationship with your supplier to deliver strategic business value to the business.

Such partnerships have evolved in recent times - companies are increasingly working with their partners to provide cross-functional capabilities within their product ranges. Co-creations from suppliers, suppliers acting as a sales engine, suppliers that fulfill a gap in a product line etc. to name a few are more common now than they were before!

A recent survey from McKinsey in fact goes on to show how companies with advanced supplier collaboration capabilities tend to outperform their peers with 196% EBIDTA percentage growth in company scores of supplier development and innovation.

More than a decade ago, I worked as a category manager for a FMCG company for several categories. It was a great I quickly began to understand the various commercial structures this company put in place with its suppliers - some of the commercial value sharing models even had co-funded pools where co-development was one of the deliverables that the supplier took on. However, one of the key things in order for such programs to be a success is to develop a process with a structured approach and governance that defined joint objectives, a business case that was beneficial and compelling to both parties, clear and well defined commercials/sharing mechanism with detailed roles and responsibilities, and finally alignment of the incentives of all teams concerned.

Building a strong partnership with your suppliers needs an engaged approach to your relationship with them - this could be fuelled further with the right performance management structures such as a 360 degree feedback mechanism wherein not only are you rating your suppliers but they are rating you too. And such programs work only if the feedback is documented, received correctly, acted upon and done on a regular basis.

For any procurement organisation that is looking to grow into a world class procurement organisation, supplier management, collaboration and engagement is a must-have toolkit. When you have achieved a  desired level of optimisation and have perfected your negotiation strategies to obtain maximum benefits, any further growth and progress of the organisation will need to have a new approach to collaborating with your suppliers. 

I will leave you with 3 key points to building strong partnerships with your suppliers:

1. Invest in a supplier relationship management program to ensure sustainability over time. Ensure you have the right resources, objectives, infrastructure and methodology to run this program.

2. The best way to begin as always is by getting a better visibility into your spend and then use this information to identify those suppliers that could significant value to your business in order to nurture these relationships.

3. Ensure all communications with suppliers are clear, transparent, consistent and easy to access and keep track of by both you and the supplier.

In case you are looking for more guidance or even a place to start with respect to supplier management, Corcentric's Advisory practice team can help you and orient you on how to carry out the steps outlined above.

The pandemic's effect on global supply chains certainly made it clear to millions of businesses around the world that they were more vulnerable than they probably thought to many types of disruptions. The novel coronavirus halted or slowed supply chains from China to Charleston, South Carolina, and everywhere in between, and many within the industry realized that there was a greater need for supply chain resiliency than they initially suspected.

Now, the vast majority of companies in the supply chain are prioritizing the effort to build more resilience into their existing processes so that if any catastrophe — large or small — befalls them going forward, they can respond appropriately, according to a recent industry survey from Gartner. Indeed, 87% of respondents said they now plan to make investments to beef up resiliency within the next two years.

Perhaps not surprisingly, the funds needed for those investments are going to come out of existing supply chain budgets, but interestingly, fewer than 1 in 3 are trying to build up a stronger regional supply chain, the report said. Meanwhile, 45% of those polled said they believe it's still more important to customers that they provide lower prices instead of paying a premium for items sourced or manufactured within the U.S.

Strategizing for supply chain disruptions and resiliency is part of the job.Strategizing for supply chain disruptions and resiliency is part of the job.

"Supply chain executives overwhelmingly recognize the necessity to make their networks more resilient and agile," Geraint John, vice president and analyst with the Gartner Supply Chain practice. "At the same time, 60% admit that their supply chains have not been designed for resilience, but cost-efficiency. The challenge will be to create an operating model for supply chains that combines the best of both worlds and also delivers supreme customer service."

What it takes to get there
Building up to supply chain resiliency isn't always easy, however, in large part because chains are only as strong as their weakest links. New analysis from The Association for Supply Chain Management shows that only slightly more than half of companies examined use their own internal data when it comes to understanding their operations, and fewer than 2 in 5 say they have a hard time because their data is either siloed off departmentally within their own organizations, or they just don't track enough in the first place.

Fewer than 3 in 5 also said they have continuity plans in place for what to do in the event of a supply chain disruption, which the ASCM called "shockingly high."

The reality of the situation
For companies that are dragging their feet or don't feel they have the institutional bandwidth to make these improvements, reality is likely to be rather harsh, according to Supply Chain Digital. While something on the scale of the pandemic probably won't happen again any time soon, hiccups of all other sizes are still going to be the norm. If companies don't have a solid strategy for dealing with them, they may be caught in a tough situation.

As such, companies must be proactive about planning for any eventuality and put themselves in a position to succeed on an ongoing basis. Proper planning and investment will serve them well in this way.

While the novel coronavirus pandemic is still very much ongoing across the U.S., vaccine distribution and declining testing needs are finally starting to signal that risk is falling. As such, many businesses in the logistics sector — and particularly professionals specializing in procurement — may see a big chance to make themselves more effective at a time when opportunity to change seems to be presenting itself.

Certainly, many companies already altered their procurement strategies and other efforts around them because of the COVID-19 outbreak, and as things get back to something resembling pre-pandemic conditions, there is a unique opportunity, according to Spend Matters. In some ways, readjusting presents procurement pros with a blank slate on which they can create the best possible strategy going forward, including crafting new processes, right-sizing their teams with all the best members and generally getting a better handle on what makes their procurement department so effective.

Set yourself up for success in the new year.Set yourself up for success in the new year.

With that in mind, experts largely say it may be a good idea to make sure sourcing efforts are as nailed-down as possible, and that you have a strong relationship with all the suppliers you will rely on going forward under what you might call your "newest new normal," the report said. Generally speaking, the more you can do to get more data and share it with everyone in your supply chain (expecting the same from them), the better off you're all going to be.

Building sustainability
Another critical component of creating a strong supply chain and procurement processes as the pandemic winds down is focusing on sustainability, which is highly favored by many people in the industry, according to Source Today. After all, sustainability isn't just a nice buzzword that helps companies create a market for environmentally conscious customers — it's also important to finding new ways to operate efficiently and, in the end, save money.

Something as simple as looking at packaging processes today could help your company identify new avenues to simultaneously reduce waste and save money, without compromising quality or other aspects of your procurement processes, the report said. Things that worked well even five years ago might not be as cutting-edge and effective as they could be for your bottom line.

Assessing roles
Finally, as mentioned above, you might want to get the right procurement team members in place, and these could speak to how the role of purchasing has evolved in recent years, according to Material Handling & Logistics. This could include having pros on the team who can advise other departments within your organization and your supply chain partners about best practices, and drive innovation on all sides of the relationship to ensure everyone continually puts their best foot forward.

Broadly speaking, now is certainly the time for your company to look at its past procurement efforts and find ways to power out of the pandemic mindset so you're ready for the opportunities that present themselves for the remainder of 2021 and beyond.

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    Historically within the purchasing landscape, procurement professionals often had to employ a do-it-yourself approach when it came to leveraging their supply chain and establishing efficient strategies for cost reduction and spend management.  This can often put a tremendous amount of pressure on an organization’s procurement department as they are tasked with managing a countless number of spend categories among other activities. Even for larger procurement departments, managing these tasks on a daily basis can require a lot of resources and bandwidth some organizations simply do not have. As a response to these challenges, many businesses have been adopting strategies such as using a group purchasing organization (GPO) to increase purchasing efficiencies and generate value.

        As its name may imply, a group purchasing organization is essentially a consolidated purchasing group leveraged by organizations to use their collective buying power to both negotiate better pricing and gain economies of scale on their purchases. These entities (usually business) will often aggregate their purchases orders together, with an intention of capitalizing on the benefits such a purchasing approach provides. GPOs are essentially structured around membership, with the core purpose of reducing purchasing related risks and cost, while maximizing return on investment (ROI) for the members.

        By aggregating their resources, members of GPOs perform as a single, well-resourced and more powerful purchasing block. This purchasing power significantly enhance their bidding capacity, which in turn gives them a bigger say when negotiating prices, contractual terms and conditions with suppliers. In the current source-to-pay landscape we have typically seen GPOs can be divided into two main structures:  

Co-operative structure:

This is where a group of organizations conduct purchases as a single entity for the benefit of all members in the group. 

Third-party structure:

This is where an independent body (often a procurement our sourcing consultant) is brought into source, negotiate and/or contract suppliers on behalf of the group of purchasing organizations. 

        With the myriad of benefits Group Purchasing Organizations provide, there has been a clear shift in incorporating them into organization's procurement strategies. While the value of a GPO can depend on the respective organization's business objectives, the following benefits typically remain constant across programs:  

Bulk Purchase Discounts & Efficiency Gains:

        It is easier to negotiate for a bigger discount when purchasing larger (bulk) quantities, thereby driving the cost price down than would be the case with smaller volumes. In addition, GPO programs help their members identify the lowest cost for goods and identify best practices to increase the overall value proposition. According to a study collected and reported by Dobson DaVanzo & Associates, interviewees reported that since partnering with a GPO program, they were able to gain unique insight into clinical “best practices” with one respondent in the healthcare industry reporting that his hospital had ‘implemented 238 unique initiatives across a range of areas to optimize their supply chain operations, achieving $15.7 million in annualized savings to date and increased overall inpatient satisfaction.’

Increased Economies of Scale & Cost Savings:

        For perspective, consider an organization purchasing goods to be delivered via freight.  It is cheaper to transport 30 tons of supplies at once as a single load than it is to transport separate loads of 10 tons each.  Purchasing in bulk, allows the buyer(s) to move or deliver the whole consignment at once, in the process reducing transit risks and costs usually associated with cargo transportation.

Higher Return on Investment:

        The significant savings organizations realize through group purchasing organizations, for example, bulk purchase discount and economies of scale, have a direct impact on the bottom line and resulting in higher return on investment. GPOs are the best option especially for small and medium sized businesses, who often lack the liquidity and capacity to compete with larger and well-resourced companies.

Be as it may, it is vital that one carefully vet and evaluates a potential GPO to make sure it is a viable fit before taking membership.