Our blog “If Value Matters, Why Am I Measured on Cost?” always gets a lot of interaction from purchasing managers who believe that performance metrics that focus on PO to PO price reductions do not show the value that purchasing is providing their companies. Here is a thought.  Instead of waiting on the CEO’s and CFO’s to change, why don’t we take advice from Michael Jackson and look at the man (or woman) in the mirror and change our ways? … [Read more...]

What’s the best way to leverage should-be cost data when negotiating pricing with suppliers?   When your supplier is integral to your organization’s success, we assert that the best outcome is one where the buyer gets the lowest price possible while the supplier makes a reasonable profit.   At APD, we’ve found that a knowledge-based, collaborative negotiation is the best tool for achieving this outcome. Past posts have summarized how to build should-be cost models, which are very useful for … [Read more...]

In our previous blog post, we described three approaches to answer the “how much will it cost” question without having to RFQ the supply base or adopt complex clean sheet estimating software.  These simple methods allow you to estimate costs based on physical part attributes and volume data.  In this post, we outline how you can calculate even more accurate cost estimates for those commodities where you are getting supplier cost details. Why should you go to the trouble of developing more … [Read more...]

Suppliers to the automotive sector have a new quality standard to comply with.  In less than 45 weeks, TS16949 will expire and every automotive supplier will need to conduct a transition audit that addresses both the IATF 16949 and ISO 9001:2015 standards. … [Read more...]

Manufacturing executives consistently cite “adding value to the company’s bottom line” as a top priority for purchasing.  We highlighted how purchasing can contribute bottom line value by aiding in new business pursuit in an earlier Purchasing Insights; in this issue, we address the topic of cost savings. … [Read more...]

Competition for experienced purchasing talent is at an all-time high. Purchasing superheroes are out there, but you’ll need to move fast and act decisively to land them. Here are eight tips for improving your odds of not just filling a desk, but finding a proven purchasing professional to add to your team. … [Read more...]

Our 2017 survey of manufacturing company C-suite executives reinforced that purchasing needs to add more value to the bottom line (repeating a key finding of the 2016 survey).  New insights from our 2017 survey and conversations with executives point towards supporting new business pursuit as a C-suite priority for purchasing.  … [Read more...]

Acquisitions provide companies with the opportunity, if executed well, to accelerate growth and create value in their business.  However, poorly executed acquisitions that are overvalued or not integrated well can have negative impacts up to and including loss of your investment. … [Read more...]