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...]
Win the Talent War for Purchasing Professionals in 2017
APD Placement conducted a survey of nearly 200 purchasing professionals in 2016 to find out what they valued in their current position, and what their priorities would be in a new job. The results were published in the white paper … [Read more...]
Change is in the Air for Trade; But What is Changing and When
The recent US election has brought with it the possibility of significant changes to corporate taxation, health care and trade policies with some of our largest trading partners. In this month’s Purchasing Insights we will talk about Trade. … [Read more...]
Over-Achieving the Material Cost Savings Plan in 2017
A 2013 IBM study found that companies with high performing purchasing organizations achieve 22% higher margins. This figure is especially significant for manufacturer’s whose material as a percentage of sales most often falls between 50 and 70%. But what sets the high performing purchasing organizations apart and enables the margin improvement? … [Read more...]
The Migration of Manufacturing to Mexico
There is a common mistaken belief that Lemmings hurl themselves off of cliffs in an act of mass suicide to control their population. Actually, the Lemmings are participating in a mass migration. The fortunate land in the water and complete their migration; the unfortunate land on the rocks below. Similar to Lemmings, manufacturers have participated in mass global migrations as business opportunities were identified in Brazil (1980’s and 1990’s), China and to a lesser degree India (2000’s … [Read more...]
Preparing for a change in U.S. light vehicle sales
The domestic automotive industry has been on a tear since bottoming out during the great recession. Volumes have exceeded the previous peak, and there are plenty of indicators that a growing economy will continue to drive vehicle purchases. But there are plenty of reasons why growth will stall, ranging from weaknesses in global demand to declines in consumer confidence to a potential interest rate increase. The mixed message for the US economy is leading forecasters to vary their … [Read more...]
It’s time to quit wasting buyers’ time
I remember as a kid wanting a shiny new bicycle. My dad looked at my then current bike, dirty and uncared for, and said “Why get you a new bike when you don’t take care of the one that you have”. How does this apply to buyers? Many purchasing managers, directors and vice presidents come to us looking for that shiny new buyer who is going to help relieve an overburdened staff or improve their organization’s results when what they should be doing is taking care of the buyers that they … [Read more...]
Sorry to interrupt your Summer…
I find it almost cruel to do this but I am going to interrupt your summer with the following work-related thought. Most companies operate on a fiscal year that corresponds to the calendar year. Some of those companies have already started developing their business plans for 2017 and almost all, even those who have not started yet, will be knee-deep in plan development in August and September. Over the course of the past 12 years in consulting I have noticed that purchasing leaders address … [Read more...]
If Value Matters, Why am I Measured on Cost?
58% of the CEO’s we surveyed questioned whether or not their purchasing organizations are providing value to their companies’ bottom line. However, when we look at the metrics used to measure performance we often find: Purchasing is measured on price reductions alone, not on value provided Purchasing alone has ownership of the cost/value goal Metrics are short term/current year focused Here are three insights that were shared in the June 15 webinar “Purchasing Metrics that Matter – … [Read more...]
Purchasing Can Have it All: How Collaborative Cost Processes Deliver Results and Build Alignment
Our experience is that far too often purchasing leaders see collaboration with the supply base and savings achievement as mutually exclusive goals; you can achieve one or the other, but not both. Perhaps that is why 58% of the CEO’s we surveyed questioned the value their purchasing organizations drop to the bottom line and 52% believe there are significant savings yet to be realized. When we interviewed CEO’s, they often talked about the lack of strategy and alignment/collaboration within their … [Read more...]