Strategic Sourcing and B2B E Commerce Solutions For ASEAN Purchasing Professional

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Best Practice is NOT Best Practice

Strategic Sourcing &E Procurement for ASEAN Purchasing Professionals

Bill KohnenPASIA Conference October 2015

ASEAN As a region already among the biggest

Growth rate in total larger than all others

Shift to consumer of large portion of global GDP

Exports will remain important but shift to regional demand

ASEAN regional demand is diverse itself

ASEAN skill base will need to evolve

Transformation From Offshoring ModelArbitrage labor costs by using lower-wage workers in developing nations

Liberalization Economic policy

Capabilities of emerging-market suppliers and workers

Transfer proven management processes to new locales

Transportation and Communications economics and capabilities

As wages and purchasing power rise in emerging markets, their relative importance as centers of demand, not just supply, grows.

Next ShoringProximity to demandMore than two-thirds of global manufacturing activity takes place in industries that tend to locate close to demandProximity to innovation

Adapt products to different regions

Utilize emerging technologies that could disrupt costs and process

New supply ecosystems a differentiator

Network of innovation-oriented partnerships, and a strong focus on technical skills.

Where will skills come from?Grasp the productivity potential of a range of new technologies

Have enough ground-level knowledge of local markets to influence product strategies and investment trade-offs.

The ability to build external relationships to develop vibrant, sophisticated supply ecosystemswill also be a source of competitive advantageUS, Europe, China, Japan ..Existing skill sets focused on export oriented outsource modelM or F

ASEAN Purchasing Solution Still DevelopingTRANSFORMATION

Strategic Sourcing Basic Process

Typical SolutionCloud BasedSubscriptionLittle DifferentiationTactical Modules more definedOnly Sourcing has delivered any real value

Purchasing Sits at a Busy Intersection

By its nature purchasing deals with virtually all departments

Purchasing directly touch's 50% of the organizations total revenue

At each interface point it seems there is a software solution to interface with that has different characteristics (enterprise, homegrown, cloud based, proprietary, legacy commercial etc)

The 40 or more interfaces create Strategic and Operational Challenges yet do not necessarily result in improved performance for purchasing.

CPO FORUM DISCUSSION HMB RITZ CARLTON JUNE 2015

SHORT LIST OF THE 40+ SOFTWARE SOLUTIONS PURCHASING PROFESSIONALS USEERP SystemCorporate Data WarehouseCorporate Analytic SolutionPlanning SystemMESCRMBest of Breed Purchasing Solution(s) Spend, Contract Management, Sourcing, Catalog ManagementE Signature SystemIT Tracking System Service and HardwareInbound Freight Tracking SystemSupplier Punch-out and normal websitesMS OfficeHR Employee Portal including punch outs for 401 And benefitsExternal Work related social media sites (Linked In, Professional Orgs) Inventory System Internal QA systemField Support Systems

Internal resource website for Marketing Templates, Presentation Info, company newsSynchronized Email to personal Mobile deviceCorporate travel booking toolOn average 3 personal Aps that also are relevant to work ex. Maps, currency, business news feedsCustomer Support tracking system for key suppliersP Card SystemTravel and Expense Card SystemAccounts Payable SystemInvoice Tracking/Supplier Payment SystemInternal Expense Reporting SystemShare pointDepartment Shared FilesDocument Control SystemPurchasing Transaction SystemKey Supplier hosted sitesCorporate Social Responsibility reporting internal and externalPurchase Request SystemsInternal KPI reporting systemsVideo ConferencePhone Conference

CPO FORUM DISCUSSION HMB RITZ CARLTON JUNE 2015

Traditional Purchasing Tech ChoicesManual ERP SystemEnterprise SolutionsInternal DevelopmentHostedCloud BasedShared Service / BPO

Vision and SolutionVisionStrategicInnovationIntegratedMobileInsightful Decision Making

SolutionsTacticalDigitizing old practiceModulesERP on the webExcel spread sheet Pie in the sky

SPEND ANALYSIS IS THE TOP TOOL FOR A CPOISM SV Bill Kohnen July 21 2015IN PRACTICE FEW ORGANIZATIONS HAVE THE CAPABILITY TO CONDUCT A COMPREHENSIVE SPEND ANALYSIS

WHY AFTER OVER 100 YEARS OF CORPORATE PURCHASING IS SPEND ANALYSIS NOT WIDESPREADNON REPEATABLE EVENT STATIC RESULTS

SPEND ANALYSIS Technology Not The Answer So FarTECHNOLOGYCONSTRAINTMAINFRAMEAccess to DataNo User InterfaceCLIENT SERVER/NETWORKData Further DispersedERPAccess to DataPoor AnalyticsMS OFFICE SUITEStart to Analyze DataDriven by Strategic SourcingCLOUD SOLUTIONSSecurityProcess and Capability

ISM SV Bill Kohnen July 21 2015EVEN WITH IMPERFECT DATA YOU CAN START THE PROCESS AND GET IMMEDIATE VALUE FROM SPREADSHEETS

Spend Analysis Cloud SolutionISM SV Bill Kohnen July 21 2015

Questions TO ASKULTIMATELY USER EXPERIENCE WHICH IS VIEWING MEANINGFUL OUTPUT IS MOST IMPORTANT TO BEST DETERMINE CAPABILITY HAVE PROVIDERS RUN A DEMO USING A PORTION OF YOUR DATA

Solutions Have ChallengesEnterprise powers are behind and know it Really are introducing new productsNewer Solutions providers do not have deep subject knowledgeReally little differentiation Adoption is the key metricBasic things still challengesSupplier On boardingDocument OutputAuto close of purchase ordersChoice is who do you ant to start journey with

What to Look For IdealSocial MediaReal value from IoTReal Mobile AccessEasy Data AnalyticsEffortless TransactionsSingle data sourcesOptimized for you

BEST PRACTICES DO NOT CREATE SUSTAINED VALUEWEALTH IS CREATED BY INSIGHT TO DIFFERENTIATE WITH DISTINCTIVE PRODUCTSSummary of Thoughts Presented by Jules Goddard at Nudgestock2

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ASEAN Based Purchasing ProfessionalsStrategic Sourcing and E Commerce are important and will be increasingly important because of regional growth driven by local demand

Skills needed are unique and not what is being practiced in BPOs, shared services organizations or purchasing outside of ASEAN

Merge high end strategic sourcing, regional knowledge and e commerce B2B solutions that meet needs in ASEAN countries not off the shelf western tool.