Russian companies are thinking of increasing efficiency through procurement automation. Adopting this solution is commendable, and it is imperative to choose the right approach to avoid any spanners in the works that end up doing more harm than good instead of saving you money. To make sure this doesn’t happen, we’ve put together a handy checklist for those just starting out.
Tail spend accounts for about 20 % of non-core expenses, which are not easy to manage due to limited in-house resources and a high volume of transactions and suppliers. As a rule, these are one-off or low value purchases, which is why the procurement department does not devote enough attention to them. However, due to company policy, it is necessary to address the issue of tail spend, where present.
This article will be useful for CEOs and CFOs of companies with the revenue of more than 1 billion rubles, in which the share of procurement costs exceeds 20%. Can you answer the following three questions? How efficient is procurement in your company? What value does procurement bring to your company? Can procurement costs be decreased by 25-30% without losing quality and volumes?
In the previous article, we set out a sequence of steps required for updating the procurement business process with state-of-the-art technology. Now, let's look at the typical mistakes made by automation initiators.
Many Russian companies introduce bureaucratic measures to fight corruption in procurement, but this only serves to complicate work and doesn’t have the desired effect.
I have frequently discussed procurement optimisation issues with CEOs and CFOs. Here I have put together some of the most common stereotypes/ideas that top management in Russia have about the procurement function and role in a company.
It is not so easy to discover “points of attraction” and corruption risks associated with tendering as it may seem. However, there are some signs which will help you identify corruption schemes and prevent misuse at early stages.
10 proven methods, which might help a procurement manager to earn more.
It is not easy to find a top-class procurement professional, since, on the one hand, purchases require best practices expertise, and on the other hand, they need unconventional thinking and a creative approach. Highlights and challenges of up-to-date recruiting techniques with a focus on procurement can be found in a number of resources.
In the first part of this article, we talked about the benefits of group purchasing and how to choose categories and pool partners. Let’s now look into how such purchases are organized.
Any CEO wants purchases in their company to be effective and efficient, and wants the supplier to provide high quality services.
In companies with a well-functioning procurement mechanism a distinction is usually made between sourcing and operational (follow-up or contract execution) activities.
In my opinion, the purchasing process is the least automated part of business. What are the most common procurement automation stereotypes you know? We’ll get to debunking them later, but right now let’s take a look at the list of stereotypes.
Anton Trunin, Head of Procurement for the Russia and Eastern Europe Autoglass department of JSC "AGC Glass Russia" plant in Bor city, shared his experience of cutting spend through outsourcing in procurement. “AGC Glass Russia” is a Russian business unit of Asahi Glass Corporation, a Japanese global glass manufacturing company, headquartered in Tokyo. Asahi Glass was named one of Thomson Reuters Top 100 Global Innovators in 2013.