Jason Busch, Managing Director, Research, Spend Matters
Throughout the course of recent interviews with a variety of practitioners and providers, Spend Matters discovered a number of reasons for a surprisingly broad and divergent range of project and SOW-based capability inside procurement organizations. While some are clearly doing SOW right, pushing hundreds of millions of dollars in annual spend (or more) through VMS platforms that have been extended to manage all of the intricacies required for SOW enablement, the majority of companies do not find themselves as fortunate. Indeed, many are lagging behind in terms of implementation and even platform evaluation. The impact SOW enablement can have (relative to contingent workforce automation through the same VMS) can be highly, highly variable.
This Spend Matters Compass explores today’s SOW-based adoption patterns, starting with how the environment is changing. We’ll also explore SOW suggestions for overcoming adoption, collaboration and process hurdles in adopting these services procurement platforms and enabling third-party management services. Looking at the changing SOW adoption landscape, Spend Matters has observed a historic evolution of the recent market and certainly, the start of a new inflection point – if not select rapid adoption in certain market segments. To learn more about SOW adoption trends, best practices and expectations for 2013 and beyond, download this research brief today.
Nearly all of the vendor management system (VMS) providers that Spend Matters has spoken to in recent years suggest analytics and reporting is what differentiates them from the rest. Yet in terms of absolute capability, Spend Matters believes that procurement, HR and IT organizations rarely get what they need from VMS analytics in the their own deployments. The blame for this can be seen primarily from looking in the mirror rather than pointing fingers solely at providers, however. The fundamental challenge is that rather than using analytics as a means to explore a potentially infinite number of datasets and opportunities, Spend Matters has observed that the majority of VMS deployments rely on no more than a dozen or so canned reports to drive basic insights and reporting on a periodic (e.g., quarterly) basis.
This Spend Matters Compass report explores two key (and often confusing!) services procurement subjects, analytics and benchmark data. For example: how do practitioners sort through vendor claims and prioritize how best to make decisions on how to use the capabilities? What is the difference between relying on standard reports, drilling into datasets or deploying contextual analytics? We also explore the challenge of arriving at accurate and truly usable benchmarks for services and people relative to goods and processes.
Jason Busch Global headlines in the past two years have highlighted the need to better manage global labor practices. Success in this environment is not just a question of sourcing and effectively managing preferred staffing firms or managed services providers (MSPs) – or even deploying the best vendor management system (VMS) to automate managing the lifecycle of contingent workforce management and increasingly, statement of work (SOW) and project-based engagements. Nor will supplier information management (SIM) applications or managed services ensure that suppliers will adhere to specific corporate social responsibility (CSR) standards including labor, health, and safety standards.
Alas, the problem is so much greater than just preferred technology and services partners. Companies that manage global labor practices – whether their own, or multiple tiers down in the supply chain – must embrace a new philosophy that not only defines expectations and standards, but puts rigorous enforcement mechanisms in place. In this analysis, we further explore the new era of global sourcing – of talent, specific deliverables, and even business outcomes – and many of the challenges and responsibilities that come along with it.