Hear it from others
McKinsey & Company
It pays to be the best
Two McKinsey & Company purchasing and operations experts, partner Jeff Shulman and associate partner Jahanzeb Noor researched supplier collaboration.
They found that “companies with advanced collaboration capabilities tend to outperform their peers in both top and bottom line performance. Leaders in supplier collaboration beat industry trends by ~2x in growth metrics.”
Learn more about their findings here
Rules for success
Michael E Raynor, a director in Eminence, Deloitte Services LP, and Mumtaz Ahmed, principal, Deloitte Consulting LLP and chief strategy officer, Deloitte LLP studied “hard financial information” on more than 25,000 companies spanning almost half a century. Of those, they identified 344 as “exceptional”… but what they wanted to know was why? What made them great companies?
The result of their research gave rise to a book “The Three Rules: How Exceptional Companies Think”, published by Portfolio Penguin. The rules?
- Better before cheaper – these companies compete on differentiators other than price
- Revenue before cost – the companies prioritize increasing revenues over reducing costs
- There are no other rules – change anything/ everything in order to abide by the first two rules
Proxima couldn’t agree more. ‘Cheaper’ and ‘cost’ are the pitfalls of a failing conventional procurement, and lead to mediocrity. ‘Better’ and ‘revenue growth’ are perfectly aligned with the principles of our Catalytic Approach, and lead to excellence.
Learn more here
The Hackett Group
The scale of the opportunity
The Hackett Group's 'procurement benchmark database analysis' details how indirect spending varies by industry – and reveals just how sizeable that spend is – between 18% and 34% of revenue for top quartile $10B companies, depending on the industry. More importantly they calculated potential savings, which ranged up to $170M.
In short, it’s what we’ve being saying all along - that many businesses are simply not aware of their level of indirect spend, and that the meaningful savings opportunities exist outside of an organization with its suppliers.