Procurement

[Gary Lim]

Two items that I can think of immediately.  One is the criteria for decision-making.  The other is competitive information.

[Ellen Naylor]

Gary,

Can you be more specific about your discussion? I am not clear what you are getting at, and I imagine others feel similarly. It's great to get your ideas! Thanks so much! Ellen

[Gary Lim]

Questions to ask the procurement people will be the composition of the people who makes the decision and the criteria for decision-making like price, operating cost, financing term, features, benefits, customer service capability, etc. Further insight includes the ranking of importance of each of these criteria. From the discussion, the CI person can use leading questions about how a particular product or service compares against competition.

If this is not clear, please ask me to clarify.

[monica nixon]

Ellen

Gary does a great job explaining the tactical side of leveraging procurement professionals.

There is of course, also the strategic side which often ends up driving make versus buy decisions by Corporate strategy groups, supplier/ODM/OEM negotiations and agreements, etc.

M

[Ellen Naylor]

Monica,

It would be good to hear you detail out your experience with how to leverage the strategic side of procurement for CI professionals. I think more people are familiar with Gary's more tactical focus and learning from these folks. It could also depend a lot on the industry and the sophistication of the procurement process.

Thanks,

Ellen

[monica nixon]

Ellen,

1. Well, one example might be that CI folks work with procurement folks who negotiate with suppliers to gather and/ or estimate a competitor's build of materials cost (BOM)/unit manufacturing cost (UMC) of a particular product- this then gives you insight into their cost elasticity, margins, volume arrangements, relationships and terms with common suppliers, ability to price compete, and so forth.


mn