Friday, January 27, 2012

Next Level Purchasing Association Launches New Site & Services, Part II

In Part I of this series, I announced how the Next Level Purchasing Association has launched its new website and I introduced you to one of its new features: Procurement Preschool. Today, I'll introduce you to another new section of the website covering on-site procurement seminars (http://nextlevelpurchasing.com/procurement-seminars.php).

The Next Level Purchasing Association has always been known for its top-quality online purchasing courses. However, we have also quietly provided to our top clients the option of having live procurement seminars conducted at their facilities. We have recently expanded our offerings, increased our instructional resources to handle a larger client base, and now have 19 such seminars available for you to bring on-site if you have a large procurement group.

Titles of some of these seminars include:
  • The Finance For Procurement Crash Course
  • The Procurement Ethics Crash Course
  • Winning The Backdoor Selling Battle
  • Leadership When The Targets Are Moving & The Times Are Trying
If you are a team leader and want to bring the Next Level Purchasing Association's world-class purchasing training to your facility for a group, please go to http://nextlevelpurchasing.com/procurement-seminars.php, identify the seminar(s) you are interested in, and contact us at 1-412-294-1991 or busdev@nextlevelpurchasing.com for a quote.

To Your Career,
Charles Dominick, SPSM, SPSM2
President & Chief Procurement Officer
Next Level Purchasing Association
Struggling To Have A Rewarding Purchasing Career?
Earn Your SPSM® Certification Online At
www.NextLevelPurchasing.com

Thursday, January 26, 2012

Does Successfully Sourcing Services Sometimes Require Seducing Suppliers?


The answer to this question is "yes - you sometimes do have to seduce suppliers when sourcing services."

Now, when I say "seduce," I'm not talking about wearing clothing that exposes more flesh than typically shown in a business environment or splashing yourself with a designer scent or using a cheesy pick up line. I'm talking about giving service suppliers the impression that there is a decent chance of them "getting lucky" (i.e., earning your purchase order).

You see, it is relatively easy to get product suppliers to respond to your RFP. Service suppliers, however, are a bit more skeptical.

While products are often standardized - meaning every customer gets products with the same specifications - services are often customized for each customer. So, pricing products isn't nearly as labor intensive as working up a quote for services.

Services suppliers sometimes see responding to RFP's as a lot of work with a small probability of success. Therefore, if they don't know much about your company or your project, they may be likely to simply ignore any RFP's that you send their way.

For products, if you send out an RFP to, say, eight product suppliers, there's a good likelihood that you'll get six or seven proposals. Send out an RFP to eight service suppliers who you've had little to no dialogue with, and you might be lucky to get two or three proposals. And those two proposals may be high priced or from the most desperate suppliers or otherwise suboptimal.

So, how can you prevent a low response rate the next time you source services?

Seduce the prospective suppliers!

Have a conversation with each prospective bidder. And make that conversation more than "Hi, I'm sourcing such-and-such services. Would you like to receive the RFP?"

Tell them the details about your project. Tell them why it would be beneficial to them to earn the order. Tell them what's great about doing business with your company (e.g., you give testimonials, pay quickly, etc.). Tell them what other services they provide that your company currently buys or may buy in the future. Make the suppliers feel enticed at the prospect of doing business with you.

If you fail to take this little bit of time to seduce the supply base, the day that proposals are due at your office may feel a little bit...lonely.

To Your Career,
Charles Dominick, SPSM, SPSM2
President & Chief Procurement Officer
Next Level Purchasing Association
Struggling To Have A Rewarding Purchasing Career?
Earn Your SPSM® Certification Online At
www.NextLevelPurchasing.com

Wednesday, January 25, 2012

The Purchasing Audit: A Quick Introduction

The goal of a purchasing audit is to determine whether policies and procedures have been followed within the purchasing department to ensure that no fraud occurred, that all decisions were made with the best interests of the organization in mind, and that suppliers were treated fairly. This assumes that the purchasing department already has policies and procedures that have built-in controls. Some of the questions that a typical purchasing audit will look to answer include:

  • Was proper documentation retained for all purchases for which it was required?
  • Was competitive bidding used in all situations where it was required?
  • Where competitive bidding was normally required but not used, were procedures for exempting a purchase from competitive bidding complied with?
  • Were all supplier selections made in accordance with the published selection criteria?
  • Were there any instances where a lower scoring or higher priced supplier was selected? If so, is the documented justification and approval acceptable?
  • Do any relationships exist between any successful bidders and the individuals who decided to award business to those bidders?

Typical frequencies for purchasing department audits range from every one to every three years.


To Your Career,
Charles Dominick, SPSM, SPSM2
President & Chief Procurement Officer
Next Level Purchasing Association
Struggling To Have A Rewarding Purchasing Career?
Earn Your SPSM® Certification Online At
www.NextLevelPurchasing.com

Monday, January 23, 2012

Remedies For Supplier Screw-ups, Part III

I hope that you have enjoyed the article "Remedies For Supplier Screw-ups, Part II."

In Part I of the series, I wrote that "
If a supplier's product fails to comply with acceptance criteria, there are five common contractual remedies that procurement professionals use: replacement, supplier repair, self-repair, refund, and contract termination." I gave two checklists to guide your use of the first two remedies in Part I and two more checklists to guide your use of the third and fourth remedies in Part II. Today, I will provide the last checklist, which is related to contract termination.

If contract termination is your chosen option:
  • Do you need to give the supplier the opportunity to fix the problem prior to invoking your right to terminate the contract?
  • If you terminate the contract and you paid a deposit, what percentage of that deposit will you be entitled to recover?
  • If you terminate the contract and deposit money is owed to you by the supplier, how soon must the supplier pay you?
  • If you terminate the contract, how much money (if any) will you owe the supplier for work performed but not completed?
That wraps things up for this series. I hope that you never have to deal with supplier screw-ups. But, if you do - and, let's face it, you probably will at some point in a long procurement career - I hope that you're prepared with some contractual remedies that will make your recovery from those screw-ups much less painful.

To Your Career,
Charles Dominick, SPSM, SPSM2
President & Chief Procurement Officer
Next Level Purchasing Association (NLPA)
Struggling To Have A Rewarding Purchasing Career?
Earn Your SPSM® Certification Online At
www.NextLevelPurchasing.com

Friday, January 20, 2012

Next Level Purchasing Association Launches New Site & Services, Part I

If you've been wondering why I've been so quiet on here lately, it's because things have been busier than ever at the Next Level Purchasing Association. A few weeks ago, we launched our new website and, with it, several new features which I will be describing here in a series of posts. The new feature that I'll talk about today is "Procurement Preschool."

One of the most commonly bad processes in a procurement department is onboarding a new procurement employee. Usually, the onboarding process involves instructions from a manager that go something like this: "Welcome on board, Sarah. Today and tomorrow, I'm going to have you sit with Jim so he can show you how to get around on the system. By Wednesday, you'll be ready to be on your own. Go get 'em!"

Now, we have always had our online class "Mastering Purchasing Fundamentals" to teach new buyers the finer points of tactical procurement. However, sometimes, these newbies need things broken down even further than most managers realize. They will have super-basic questions like "What is FOB?", "What is an RFP?", and "What is a PO?"

Well, we wanted to make it easy and fun for them to find answers. So, we recruited some future procurement leaders in the 7-9 year-old age range (they're my kids, lest you think about any violations of child labor) to shoot some videos explaining some of these basic topics in a simple-to-understand, non-threatening manner. This collection of videos is called "Procurement Preschool" and, below, you will find a link to Procurement Preschool on our new site; the Purchasing Certification Channel on YouTube, which hosts the videos; and an embedded video of its own.

Soon, I will be back to tell you more about the new features of our site. But, for now, it's back to work on the numerous other exciting launches we have coming up this year. 2012 is going to be a rockin' year in the procurement world!

Procurement Preschool

The Purchasing Certification Channel



To Your Career,
Charles Dominick, SPSM, SPSM2
President & Chief Procurement Officer
Next Level Purchasing, Inc.
Struggling To Have A Rewarding Purchasing Career?
Earn Your SPSM® Certification Online At
www.NextLevelPurchasing.com

Friday, January 06, 2012

The NLPA Dedicated Member of the Month for January 2012 Is...

Every month, the Next Level Purchasing Association (NLPA) recognizes a purchasing professional who has made impressive progress in learning more about his/her field. We are excited to announce that the NLPA Dedicated Member of the Month for January 2012 is...

Randy Jenson, a Senior Buyer at SJE-Rhombus in Detroit Lakes, Minnesota, USA. In December, Randy completed all six Senior Professional in Supply Management® Program classes!

"As a purchasing professional for over 15 years I was looking for a program to enhance what I have learned in the past as well as grow & learn new ideas/techniques. The Next Level Purchasing SPSM® Certification Program was exactly what I was looking for.

"I credit my success on completing all courses in 1 month thanks to technology and the SPSM® Program design. With mobile devices such as smart phones & tablets the course was always accessible to me. Whenever I had a few spare minutes I would read through a few pages, then jot down some notes."

The NLPA and the procurement community around the world congratulate Randy and his dedication to having a more successful purchasing career!


To Your Career,
Charles Dominick, SPSM, SPSM2
President & Chief Procurement Officer
Next Level Purchasing, Inc.
Author - The Procurement Game Plan
Struggling To Have A Rewarding Purchasing Career?
Earn Your SPSM® Certification Online At
www.NextLevelPurchasing.com

Tuesday, January 03, 2012

New Procurement Book Revolutionizes Learning For Supply Chain Leaders

While many of the procurement books out there are dry and often snooze-inducing, an exciting, new book released today has finally made learning how to implement procurement best practices fun. Next Level Purchasing founder Charles Dominick, SPSM, SPSM2 and Dr. Soheila Lunney, SPSM, have co-authored "The Procurement Game Plan: Winning Strategies and Techniques for Supply Management Professionals" - a fresh, innovative text that combines step-by-step procurement techniques with sports analogies for a reading experience that is as entertaining as it is educational.

Sure to become a go-to asset, "The Procurement Game Plan" encourages procurement leaders and practitioners to "take the ball" by offering an easy-to-follow game plan with strategies that can be implemented to improve supplier relations, achieve measurable cost savings, reduce risk, and attain operational efficiency. These strategies ultimately lead to improved margins and competitiveness for the organizations of the procurement leaders who implement them. "The Procurement Game Plan" is the guide that all procurement professionals need to take their performance to the next level.

"The Procurement Game Plan" has already begun receiving rave reviews from industry leaders, including R. Gregg Brandyberry, a Senior Advisor for A.T. Kearney Procurement and Analytic Solutions, who called the book "a purchasing classic, a tutorial that everyone will want to have close by," and Westinghouse Electric Company‘s CPO, Juan Molina, who dubbed the book "a candid and comprehensive look at how to succeed in procurement—a must read for procurement professionals and everyone from college graduates to CPOs."

"Dr. Lunney and I set out to provide procurement leaders with something that they were sorely missing – actionable strategies in a format that is both practical and enjoyable," said Charles Dominick, SPSM, SPSM2 – the President and Founder of Next Level Purchasing, Inc. "I think we have accomplished that with 'The Procurement Game Plan' and we are looking forward to seeing the measurable benefits it brings to procurement organizations throughout the world."

The Procurement Game Plan is available directly from the publisher, J. Ross Publishing, at http://tinyurl.com/procurementbook or Amazon.com at http://www.amazon.com/Procurement-Game-Plan-Strategies-Professionals/dp/1604270675.

About the Authors

Charles Dominick, SPSM, SPSM2, is the President and Founder of Next Level Purchasing, Inc., a globally-recognized provider of high-quality education for procurement departments and supply management professionals and the exclusive source for the Senior Professional in Supply Management® certifications. Through the content he has developed for Next Level Purchasing, Mr. Dominick has trained procurement professionals from over 100 countries. Mr. Dominick is a highly sought-after speaker and his articles have appeared in numerous prestigious publications.

Dr. Soheila R. Lunney, SPSM, is President of Lunney Advisory Group LLC, a firm that provides procurement and supply chain management coaching, mentoring, and training services. Dr. Lunney is also a Director of ASSET, Inc. — an education improvement nonprofit organization. Dr. Lunney was previously Vice President of Procurement for Education Management Corporation and Deputy Director to the Chief Procurement Officer at Bayer Corporation. Dr. Lunney is also a frequent speaker at educational events throughout the world.

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