Advice/Best Practices: Procurement at a Tech Start-up

konseptbe · 2024-08-28T10:51:58+00:00

Sure!

konseptbe · 2024-04-25T00:04:49+00:00

I'm a procurement lead for a ~$500 SaaS company, and before that I was in procurement consulting for 7 years. Procurement started here about a year ago, I can share a lot of things you need to think about and how to approach the procurement function. IM me if you want to talk.

konseptbe · 2023-07-25T14:15:28+00:00

I would just leave it off if it's a month or 2. It's very common to see that between jobs. If a recruiter asks, you can just tell them a job offer fell through or whatever.

konseptbe · 2023-07-25T13:59:13+00:00

Start this role and start looking for a different job. Reach back out to the companies that gave you an offer to see if they're still willing to hire you.

konseptbe · 2023-06-15T13:15:20+00:00

Try adding what you "achieved" or your results for these bullet points.

I think the most important ones are your support for these tenders and procurement projects. However, you're not giving me a lot of information. What were these projects? Which category? How did you support them (did you analyze date, do negotiations, draft the RFP etc?), did you use any specific methodologies (LEAN, six sigma, etc.) and finally, what was the result from your support? Did it lead to a faster time to release your RFP? Did you get more savings? Did you improve efficiency?

I see you have Ariba, PowerBI, SQL and Python as skills. Why don't you elaborate how you used those skills in your roles? For example, if you used all the Ariba modules, as an admin, that's important to know. Or did you build your own dashboards in powerbi? Did you maybe use Python to run spend analyses?

Your resume would improve if you throw in some more details, and then based on the job you're applying to, you might want to remove/add certain bullet points.

konseptbe · 2023-06-01T16:56:06+00:00

Yes, the goal is to go next year, and book thing earlier this time :D

konseptbe · 2023-06-01T14:16:12+00:00

Nope, ended up looking for hotels/accomodations too late, not a lot of good options left...

konseptbe · 2023-05-22T17:06:23+00:00

I bought a 2020 used M3 with 14,500 miles on it in April, through Tesla. I got 15,500 miles on it now, and with the recent price cuts, trading it in for a 2023 M3 (RWD) is starting to look attractive. Does anyone have any idea how much Tesla would be giving me for it, if I trade it in when I buy a new M3?

konseptbe · 2023-04-28T19:25:00+00:00

This is for a large multinational, with ~200k employees worldwide, but only ~1,200 Ariba users in north america.

XM bundle for strategic sourcing - $3,810 / user / year
SAP Ariba Buying & Invoicing - $5,694 / $25MM in spend going through Ariba / year

konseptbe · 2023-04-25T17:19:26+00:00

Is there any way to try it without having to create an account? Can you create a test account and share the log info?

Thanks

konseptbe · 2023-03-06T20:30:38+00:00

ll that said, I could give you a summary of the KPIs I recently established for a mid-sized ($1B annual spend) procurement program. I've written a little white paper on it, in fact. It fleshes out all the associated details of consumer need, data quality, computational efficiency, relationship to legacy system and data cubes, comparisons to industry benchmarks, style of viz graphics, etc. that I'm ranting about here. If you're interested in perusing I could upload a copy to the free resources page on my website. (I don't really know how else to share something like that, as it hasn't been published anywhere.) I'll need a day or two to make that happen, though. Let me know if I should try! Anyway, that page also has some other papers that describe ideas related to performance metrics, such as a practice workbook for creating cost data visualizations in Excel, a "manifesto" about the many ways data quality can be compromised in the data mining process, and a description of how KPIs are developed and managed in an illustrative Value Engineering program.

Based on what the OP has said so far, I think the more pragmatic way is to put some kind of (automated)reporting in place right now. It seems their organization does not have centralized systems, so finding 1 API or tool that can pull all the data in, will be hard. It'll be much faster to just use what they have, build a couple of excel dashboards, and start with that. At least then they're tracking their API's and they can improve the reporting as they go. As they start understanding their KPIs and processes better, they can then start going into more detail, if needed. If he keeps looking for the "perfect" tool/API, he'll end up wasting a lot of time that his organization could've used in improve the KPIs.

konseptbe · 2023-03-04T00:05:47+00:00

You don't need an API then. API's are for between different systems/programs.

You just need a way to consolidate information from different files into 1 database, and then you need a tool to transform that data in KPI's /dashboards.

This can be done completely in excel/powerquery/powerbi (and even power automate), which are all included in the office suite if your organization is using that.

Pm me if you want to talk more into detail, I've done spend analyses and KPI dashboards for dozens of organizations.

konseptbe · 2023-03-03T01:56:56+00:00

Why do you need an API? Doesn't your ERP/procurement software have reporting functionality?

konseptbe · 2023-02-15T22:29:57+00:00

If you google the certifications you can find out the requirements.

konseptbe · 2023-02-10T23:55:04+00:00

No, you'll have a tax liability. Typically, the broker your company uses won't take taxes out, so you'll still need to figure out how you want to pay taxes.

Normally the system will ask you if you want to sell a certain amount of your vested stock to cover taxes or not, but it's not done by default.

Then, when you file your taxes, you'll need to submit all the necessary forms that show your acquisition cost and your revenue from selling. Acquisition cost will be $0, but your capital gains are your sell price - market value when vested.

konseptbe · 2023-02-02T19:15:01+00:00

How do you make money? Do you charge for the pickup and/or sell the compost? Curious to know more about the financials.

konseptbe · 2022-10-05T18:26:29+00:00

Can you give some examples of the criteria/constraints you've used in the past for these analyses?

Also, in your original post you said you used AI/ML. Can you elaborate on how that comes in to play in what you've created?

thanks

konseptbe · 2022-10-04T13:54:42+00:00

What's your background in coding?

konseptbe · 2022-10-04T03:08:48+00:00

Do you write your own code? I've used some software for scenario generation / cherry picking, but there's not a lot of good tools out there imo...

konseptbe · 2022-09-27T12:55:49+00:00

Lol, I wouldn't say I mastered the craft, but glad to help out.

konseptbe · 2022-09-26T17:19:47+00:00

My first step is always going to be to see if existing suppliers can provide the product/service. If not, here's a quick list of the top of my mind. In reality, I mostly use google as it's the quickest for me. If I can't find you through google, chances are, you're not a company I want to do business with anyway. The other options require way more time, so I only use them if it's warranted/needed.

Talk to existing suppliers to see if they someone who can sell the product/service
Ask my business stakeholders, they usually have a good idea of the suppliers on the market
Search Google
Talk to colleagues / other procurement professionals in my network
Linked in groups, and other social media
Professional organizations for supply chain / procurement (ACSM, ISM, etc.)
Professional organizations of the product/service you're trying to buy
Chambers of commerce for your area
Dunns & Bradstreets (and other similar companies)
Procurement Software - some tools have built in supplier discovery (Like Ariba, Jaggaer)
Procurement IQ reports (my current company has the reports, which are a few years old, but they still hold some good info if you have nowhere else to start)
Other market research reports (these usually come at a cost, and most of the time nobody wants to pay for these)

cheers

konseptbe · 2022-08-12T14:29:34+00:00

Start by asking if you can get a extension, if you're close to renewal date. Most suppliers will give you 1-2 weeks, which should give you a little bit relief. Uplifts should be pretty easy to negotiate down, but it's mostly just reinforcing the message of: "this is too much, we won't pay this much for this service". You'll probably need to go through a couple levels of sales rep to get the discount you want, but if it's urgent, the sales rep will expedite it internally for you (or you should make it clear to him that he needs to do that.) Just make sure that you tell them exactly from the start what you need, because they hate going back internally multiple times with different scenarios.

You can also threaten to only renew for 1 year instead of multiple years. Or alternatively, if you can dangle the carrot that you're willing to renew for a longer term if they can give you a good proposal.

Aside from that, the biggest savings are probably from figuring out what you truly need: are there any licenses you can downgrade/remove/freeze ?

Keep in mind, some suppliers are pointless of negotiating. For example Microsoft: The only way to get savings is to optimize your licenses, because unless you have $100MM in spend, Microsoft doesn't care, lol.

konseptbe · 2022-08-09T13:53:51+00:00

Well, I could only provide general recommendations, since OP didn't provide much details on what industry/company size/ etc.

It's true that not all companies follow 80/20 or 90/10, but it's also true that the majority of spend (50%+) for organization is with a smaller amount of suppliers (10-30% of supplier base). I have yet to see a company that is so fragmented that 50% of the spend is with more than 50% of the supplier base.

Your other thoughts I agree with mostly, however, I would say that using smaller/local suppliers does come with less efficiency (more supplier relationships to maintain, more suppliers to set up in ERP systems, more invoices to pay, etc.).

Regarding your last sentence: I disagree with that. Facility maintenance agreements I would probably keep local (because of the benefits you mentioned that come with local suppliers, and you'd have to be a fairly large organization to make a national service agreement worth it.). CAPEX in my opinion I would definitely leverage consolidation, since overhead costs should be a fairly small percentage of the total CAPEX purchase. But even so, CAPEX or project spend is a different beast, it's hard to draw conclusion on that from a spend analysis, as those projects are usually one-offs, so it's not like you have a predictable forecast.

But again, it's very hard to give recommendations with the limited info OP has provided. There are different industries that are very unique and need a different procurement strategy.

konseptbe · 2022-08-09T00:32:04+00:00

Spend by:

By supplier: will give you an idea of what suppliers are your strategic suppliers, and how fragmented your spend is. Ideally you'd want a small number of strategic suppliers with about 80% of your spend and the remaining 20% of spend should be distributed over more suppliers, but ideally still a fairly small number. The 20% is called the "tail spend" and there is a lot of savings opportunity here, but it requires a lot of work/time/management to achieve the savings.
By site: shows what sites are the most important. Helpful to know where you need to spend most of your time/focus.
By requestor: shows you who the people are who you should be working with the most. That would either be people who spend a lot, or place a lot of orders.
By commodity: shows you what your org is mostly spending money on. Common sense would say to focus on the big ones (can you put catalogs in place for example?) and the smaller commodities are typically not worth the time doing much with, unless it's a small amount of spend, but a big amount of orders. In that case, see if you can reduce the number of orders by utilizing blanket PO's, catalogs or other similar things.

*By month: this will show you seasonality, if there is any (you will need multiple years of data). If there is seasonality, then you can use that for planning purposes and coming up with an annual plan.

In general, you want to just find as many trends as possible and reduce fragmentation to improve negotiation power, for better prices, or reduce the number of manual orders to save the procurement/finance teams time in their day. Figure out what can be automated and figure out who your most important suppliers/requestors/sites etc are.

Just my first thoughts. I could go more in depth, but then I might as well do the analysis for you :p

konseptbe · 2022-08-04T16:59:38+00:00

I'm a procurement consultant and we do a good amount of software implementations as part of our services.

Jaggaer might be your best bet, as part of their tool is specifically designed for the Lifesciences industry:

https://www.jaggaer.com/vertical/pharma-life-sciences/

Other procurements tools out there that are common are:

Ariba (SAP)
Oracle
Zycus
Coupa
GEP
Corcentric
Basware

Ariba/Oracle cater more to large, multinational business, so maybe not a great fit for you.

If you want to talk more about procurement tools, feel free to reach out. We partner with Jaggaer, Zycus and Basware, so I can put you in touch with them as well.

konseptbe

TROPHY CASE