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Transcript of Www.propurchaser.com Join the PURCHASING KNOWLEDGE REVOLUTION Prepared for CAM Canada November 22,...
www.propurchaser.com
Join the Join the
PURCHASING PURCHASING KNOWLEDGEKNOWLEDGE
REVOLUTIONREVOLUTION
Prepared for CAM Canada November 22, 2004
www.propurchaser.com
Purchasing is a very busy job
shorter planning cycles (AKA flexible manufacturing)
smallerinventories(less safety stock)
unreliable information(late, missing,incomplete)
fewer support people
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This is the real Job
Increase the value received for the dollars we spend
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No one can be No one can be effective at their jobeffective at their job
if they’re always fighting fires.if they’re always fighting fires.
NOT EVEN FIREMEN !
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Urgent Work vs Non-Urgent WorkUrgent Work vs Non-Urgent Work
Non-urgent work happens when:
• We improve our marketplace & technical knowledge to increase negotiating effectiveness
• We seek out value-adding alternatives: new suppliers or materials
• We team up with Engineering, R&D, Production, & Suppliers to optimize materials, specifications & processes
Urgent work happens when:
• Materials & services are late, short, defective, or missing
• Surprise shortages occur due to unexpected high usage
• Surprise shortages occur due to inventory reporting errors
• Suppliers’ declare force majeur
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What’s the major difference?What’s the major difference? Non-urgent work adds value!
It’s what our customers, shareholders, senior managers, stakeholders, and WE really want us to do.
‘Demonstrating profound value to the bottom-line’ means finding time for non-urgent work.
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The Joy of Escaping from the
Everything is Urgent Zone
1. Carve out time.
2. Drive down purchase costs.
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Escaping from theEVERYTHING IS URGENT Zone
Manage one of the
major time traps -
Price Hassles
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How to spend less timehaggling & hassling
Track suppliers’ input costsTrack suppliers’ input costs
- then tie what you pay - then tie what you pay to their costs.to their costs.
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LUMBER
Pallets
LINERBOARD
Corrugated Packaging
COLD ROLLED
STEEL
Stampings, Cut Sheets
As prices for commodities go up & down,
Presented by: Rod Sherkin
so too do your suppliers’ costs to produce the goods & services you buy
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The best supplierssee advantage
in linking prices to costs
They actually prefer to compete in a transparent arena
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Suppose you’ve been able to make a deal…
How do you maintain it?
Where do you find the time?
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Purchasers already need tokeep track of so many things
Packaging
Transportation
Components
Ingredients
MRO Services
Utilities
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The task of keeping tabs onThe task of keeping tabs onsuppliers’ inputs suppliers’ inputs
is daunting to say the leastis daunting to say the least
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Enter the Internet
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For the first time in history
INFORMATION
can seek out
PEOPLE!
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Even better,
you can filter information
to meet your
personal requirements
A perfect tool for busy people
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This is nothing short of aPurchasing Knowledge
Revolution
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13%
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-12%
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• Increases negotiating leverage
• Widens span of price control
• Delivers cost transparency
There are more good reasons to use this approach…
Advantages of using the InternetAdvantages of using the Internetto track your suppliers’ inputsto track your suppliers’ inputs
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Five More Good Reasonsfor tracking suppliers’ inputs
1.1. Attract low-cost producersAttract low-cost producers
2.2. Strengthen the supply-chainStrengthen the supply-chain
3.3. Reduce suspicion and acrimonyReduce suspicion and acrimony
4.4. Benefit sellers as well as PurchasersBenefit sellers as well as Purchasers
5.5. Enable automatic price reductionsEnable automatic price reductions
But best of allBut best of all
It frees up Purchasers’
precious time.
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What can Purchasers do What can Purchasers do with their new-found time?with their new-found time?
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Devote more time to value-adding work…
Improving marketplace & technical knowledge to increase negotiating effectiveness
Seeking out value-adding alternatives: new suppliers or materials
Teaming up with Engineering, R&D, Production, & Suppliers to optimize materials, specifications & processes
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What Larry BossidyWhat Larry Bossidyof Allied Signalof Allied Signal
says about Purchasing…says about Purchasing…
This thoroughfare to savings This thoroughfare to savings is broad and fast -- is broad and fast -- yet so unsexy that yet so unsexy that
even seasoned managers pass it by.even seasoned managers pass it by.
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What William Marx,What William Marx,Executive VP of Executive VP of
AT&T’s Telephone Products,AT&T’s Telephone Products,says...says...
Purchasing is by far thePurchasing is by far thelargest single functionlargest single function
at AT&T.at AT&T.Nothing we do Nothing we do
is more important.is more important.
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Opportunity KnocksOpportunity Knocks
OPEN THE DOOR!
The Internet is powering a Knowledge Revolution which
Purchasers (busy as they are) can exploit to drive down costs, and make a profound difference to the bottom-line.
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To Obtain Your Free MembershipTo Obtain Your Free Membership
www.propurchaser.com/CAM/
Click ‘Free Trial’; complete the form (90 seconds).