When the business involves the supply management group in purchasing and sourcing, it can increase savings, better leverage organizational spend, and negotiate stronger contracts. Managed spend, as a percentage of sourceable spend, is a primary indicator of a company’s ability to capture value from the supply management process.
Average Cost Savings
Cost savings is a powerful KPI for demonstrating the value of supply management (SM) to the business. On average, 21.8% of SM employees are in a strategic sourcing role, each delivering $9.1 million in total savings. How does your company compare?
Total Cost Savings
Cost savings is a cornerstone KPI for most supply management groups, measured here as reduction and avoidance in managed spend. In 2021, Oil and Gas led with 7.1% total cost savings.
Supply Management Org Design
Companies that undergo organization structure changes as part of an enterprise-wide initiative or market-driven decision face a huge endeavor, but data indicates these changes don’t happen frequently. For the last three years, an average of 72% of companies say they’ve operated under their current org structure for five or more years (Metrics of Supply Management, 2019 - 2021).
Spend Under Management
Across industries, category management employees comprise an average 17.9% of the total supply management headcount, but each SCM employee manages hundreds of millions of dollars.
Supply Management Employees
Across industries, a mere 1.3% of the total headcount is supply management employees.
Modeling & Machine Learning In Use at Top Orgs
Of the companies we surveyed, 73% use statistical modeling and 51% use deep machine learning. More on how modeling & machine learning is used at top organizations can be found in the CAPS Research report, Applying Advanced Data Analytics.
AI in Supply Management
Of the people we surveyed, 19% are currently using artificial intelligence while 34% plan to implement AI within 12 months. Top uses of AI include spend analysis, invoice processing, payment processing, and contract management.
The Advantages of Choosing Diverse Suppliers
Many large companies have found strategic benefits in developing a robust supplier diversity program, citing primarily that diverse suppliers are responsive, resilient, and committed to developing their own capabilities. Advancement of supplier diversity programs in large companies requires commitment and capital to develop suppliers, as well as alignment with business objectives.
A Shift In Post-Pandemic Travel Policies
Corporate travel policies continue to fluctuate more than a year after the global health pandemic began. In a recent survey, more than half of the participants (64%) anticipated their company would permanently shift 25 to 50% of their pre-pandemic travel to virtual options.
Non-members can receive the report of each survey they submit.
Members can access all reports, but are encouraged to submit surveys to
increase the comparative breakouts only they receive.