You’ve Negotiated – But Are You Realising Savings on Marketing Print?

You’ve Negotiated – But Are You Realising Savings on Marketing Print?

Spend Matters UK recently ran a two-part guest post by Santosh Reddy of GEP that asked if you were really realizing savings on marketing print (Part I and Part II) if you were using an outsourcing partner, such as a Print Management Company (PMC), to manage your marketing print.

In his posts he notes that the PMC comes with advantages, such as one or more pre-qualified vendors that can do all of the print jobs for all of their clients and who offer the PMC a preferential price for the guaranteed influx of work in addition to IT tools that can help your shop with digital asset management, etc. However, the PMC also comes with a disadvantage — the PMCs primary mission is to make money, not to save money for you. So the savings you get may not be as much as the savings you could get.

However, the key to savings in print is typically volume, so if you don’t use a PMC, then the category manager has to function as the PMC and make sure all print jobs get routed to the preferred vendor with preferred pricing and value-add benefits. But, as Santosh points out, this can be difficult to achieve since many internal departments, including marketing, retail, and HR, may not see the presence of Procurement as a benefit but instead view it as a loss-of-control or an unnecessary time-wasting step in the process. So how do you get the other departments on board?

Santosh presents four benefits you can sell and four less-friendly tactics you can employ if need be. Four of these suggestions in particular are quite powerful:

If these two benefits don’t get the job done:

  • one point of contact
    either the PMC or the category manager will be the sole point of contact for all internal customers – they won’t have to deal with five different print shops to find out who can do a rush print job
  • budget compliance
    it’s Procurement’s job to keep costs in line, not theirs, freeing up more of their time to do their jobs

then these two tactics will:

  • involve AP and inform them that policy states all invoices must be approved by you before being paid, as per the Procurement policy, then
  • incentivize compliance through gain or pain by rewarding those who use the process with faster services, more savings credited to their budget, etc. and punishing those won don’t by delaying invoice payments, reporting organizational losses from their actions to management, etc.

And he also gives you great advice on how to source, select the right technology to manage the process internally (whether or not you use a PMC), and establish a contract. This 2-part series is worth checking out. Given the cost of ink in North America, every penny counts!

A Brief History of Labour Day

SI was going to give you a brief history of Labour Day in North America, and Canada and the United States, in particular, where it is observed as the first Monday of September (and not May 1, which is International Workers’ Day and synonymous with Labour Day in Many Countries), but the LOLCats thought that was just too boring and did this:

Maybe next year. In the interim, maybe The Cat Whisperer can help me out!

Last Day for Free Sourcing and Procurement Papers from Spend Matters!

As per a recent post over on Spend Matters UK, today is the last day that a set of recent Spend Matters white-papers, made available by sponsors, that is currently free to practitioners goes back behind the pay-wall and this set in particular contains three pieces authored or co-authored by Pierre Mitchell and two authored or co-authored by Thomas Kase. Pierre, most recently of Hackett Group fame, is well know for his thought leadership around Supply Management best practices and Thomas, who has worked for a number of providers, is known for his deep expertise in SPM/SRM solutions. When you can get your hands on their work for free, it’s not something you should pass up.

The papers in particular that are about to become “pro” access only are:

Regular readers of SI know the utter importance of Spend Analysis, a subject which has garnered hundreds of posts on SI over the years. As one of the only two technologies that have been repeatedly to provide an organization year-over-year double digit ROI returns when properly used, your organization cannot afford to be without it! As such, the last thing you want is to be roadblocked by finance when there is no readily apparent savings opportunity (as you need the solution to clean your data to find the savings opportunity). In his piece, Pierre gives us you ten hints to getting your project approved, which can happen quickly if the project is presented appropriately. Always remember, the faster you get the system, the faster you can centralize and cleanse your data and find opportunities, and the faster you can start saving.

Just this week SI was continuing it’s RFX rants, which started back in 2007, about how the vast majority of provider RFPs suck and how you won’t get good results unless you write your own (using the provider RFP as a checklist of some key elements that need to be included, but in a way that makes sense to your organization). In Thomas’ paper he discusses some key elements of the RFP creation process that can make the difference between success and failure in your efforts.

Everyone talks about Meta Data, but not a lot of people really understand what they are talking about. In the collaborative piece between Thomas, Pierre, and Jason, the authors provide a discussion of meta data and how meta data aggregation can paint a picture not readily available from the elements. They then go on to demonstrate how the proper analysis of meta data can yield risk analysis and opportunity assessments that cannot other wise be performed and that can be very beneficial to the business day one. It’s another example of why your organization needs good data and tools to process and mine that data if it wants a true twenty-first century supply chain.

In the last piece on Procurement Analytics by Pierre, he notes that for an analytics project to be successful, you need the right scope. The scope is all of supply management, not just the tactical procurement function. All data collected from the first RFX during the sourcing process through the last on-contract procurement to the final warranty return needs to be collected and stored in one central or federated database so that an analysis can look at all relevant data, not just purchase data. It’s not just how much you paid, but how much you were supposed to pay, what you paid for, and if a different categorization would be more beneficial to your organization. And until you make an effort to centralize, or at least centralize on a common schema even if the data is scattered, you won’t even know what transformations and cleansings need to be done.

If you haven’t downloaded these yet, don’t miss your very last opportunity to do so. These are some great pieces with content that you should know, so read up!

Happy 30th, Discovery!

Thirty years ago today, Space Shuttle Discovery was launched on its maiden voyage. Before it embarked on its final mission on 24 February 2011, it flew 39 missions over 27 years and accumulated more flight time than any other spacecraft to date. This historic spacecraft assisted in the assembly of the International Space Station (ISS) and assisted in research missions as well as carrying the Hubble Space Telescope into orbit.

So, Do You Throw Provider RFX Templates Out With the Packaging?

That depends. If you have lazy, uneducated, or inexperienced Supply Management personnel (because your Procurement department was staffed like the Island of Misfit Toys), then you want to delete them as soon as you get them because, if a template exists for the product or service you want, it will be sent out more-or-less as is and you’ll get a specification that is two sizes too large, two sizes too small, or very irregular and not at all a good fit for your organization.

On the other hand if you have educated, experienced, go-getting Supply Management personnel who take the time to properly construct an RFX, going through the steps outlined in our last post, then they do have a use. Specifically, as a check-list after the RFQ has been completely drafted to make sure that nothing was missed. Sourcing is complex these days and it’s hard even for an expert to include every relevant detail every time when time and resources are so scarce. There’s a reason that even hospitals and clinics use checklists, because it greatly decreases the chance of a (serious) error being made. If a vendor, that built a template as a result of analyzing dozens of events, included something in an RFX template, then, at least at one point in time, it was very relevant and, as such, should not be excluded from an RFX until a senior buyer confirms that the market or standard operating conditions have changed and that the question, cost component, or requirement is no longer relevant.

So, these templates do have their uses, as long as they are editable by senior buyers. Because, as explained in the last paragraph, over time, some parts of the template will become irrelevant and other questions, cost components, or requirements will become very relevant and need to be in all RFXs related to that product or category. If the senior buyers can completely customize the templates to the categories, products, and services of the organization and configure the tool so that no template is used out-of-the-box (until a senior buyer confirms that it is still accurate enough out-of-the-box), then the templates, and template features, have a use.

But as-is, the templates are probably less useful than calling a supplier over the phone and saying you need a quote for customized circuit boards and doing three-bids-and-a-buy blind.

In other words, templates have a use, which is why the doctor encourages most vendors to have a library of templates that can be used as starting points, but their use, until customized by a senior buyer, is that of a post-RFX creation checklist. Nothing more. And not understanding this can get your organization in serious trouble in its sourcing events.