When it comes to the technology and the labor necessary to purchase something (either from a catalog or with a reverse auction), who should pay for procurement events? Should it be the buyer or should it be the supplier? Logically, we know that the buyer is going to pay one…

It’s an interesting question that we don’t ask often enough: why do organizations have a procurement department? Speaking with a supplier recently, he told me that his company refuses to participate in RFPs. This isn’t because he is afraid of competing. He has a compelling solution that creates real value…

What is elastic procurement™ and who should care? CIOs will recognize the word “elastic” from cloud computing. Elastic procurement™ is a delivery model that is to Big Procurement technology systems what cloud computing was to the corporate data center. It lowers costs, eliminates complexity, and empowers staff. Before Amazon Web Services or Microsoft Azure, CIOs managed large private data centers, often in multiple locations. These were anything but elastic. One might characterize them as flabby and inflexible.

What are the biggest problems in procurement? There are no shortage of them when you speak with people in different business lines within the organization. Suppliers aren’t enamored with the process, so much as resigned to it. Even procurement staff see it as the “Devil we know.” Here’s a list…

Why are opportunity costs more important than transactions costs? They’re larger. Why are opportunity costs more difficult to manage than transactions costs? They’re hidden. There is no line item for opportunity costs. …

We’ve written previously about the conceptual difference between complexity and complication. “To say that a process is complex is the not the same thing as saying it is complicated.” For example, we can imagine the developer of a large mixed-use residential and commercial construction project. These undertakings can have upwards…

When making any kind of a decision about digital transformation, people like to talk about the Return on Investment (ROI). What is the ROI of a procurement system? How can we think quantitatively and qualitatively about the costs and benefits? Imagine Betty Buyer. Her CFO tasked her with finding a…

How can B2B buyers collaborate across organizations? Why is joint purchasing something B2B buyers should consider? Before the trade skirmishes and the Pandemic and inflation and war in Europe, the mandate for procurement was simple: cut costs. The oppressed, underappreciated procurement department labored to squeeze supplier pricing, even as they…

How can we improve the performance of procurement generalists and buying specialists to make purchasing more successful? Some companies have dedicated procurement experts. These are people who have worked principally on purchasing throughout their careers. They focus on a specific category, such as buying IT. …