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Any “true love” knows, the Twelve Days of Christmas is always a nightmare for the Professional Buyer. But the Cloud can help with this annual seasonal task. As part of our #InMyCloud conversations at SAP, I thought it would be entertaining to explore how cloud solutions can optimise the purchasing tasks featured in this much-loved carol.

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andreapetrlik – Fotolia.com

On the First Day, already we see that the requestor has tried to combine two different commodities together, when they obviously come from different suppliers. The Partridge and Pear Tree need to be split into two separate lines. A Cloud Procurement solution can allow bundling and un-bundling, so that the livestock and horticultural components can be separated. The Pear Tree should be done as a quick “Spot Buy” as there are no other trees to be bought, and on the Cloud I can do a very quick “three bids and a buy”. Also, when I enter the fact that I am buying a Pear Tree, any Cloud solution is using Big Data analytics to tell me “Other people who bought this item, are also buying this: 1 Partridge”

On the Second through the Fourth Days we are acquiring birds: in fact French Hens, Calling Birds, Turtle Doves. We should construct a multi-line RFP, with the specified quantities and delivery dates and publish this on the Cloud. Pleasingly, this gives a rare opportunity to use the first UNSPSC code 10 (“Live animals”). We can use a Cloud Discovery service to reach out to avian suppliers who meet our certification requirements.

The request for five Gold Rings is more problematic since the price of gold is likely to fluctuate over the period: so the supplier should consider index-linking their price to the London Metal Exchange spot price. On a Cloud solution it is possible to get direct feeds for commodity prices, and also I may be able to consider a hedging strategy, to reduce my exposure.

On the Sixth and Seventh Days we need more birds. Both the Swans and the Geese are really example of Complex Services and they should have performance-based contracts to hold the supplier accountable if they do not “a-lay”, or “a-swim up” to the expected standard. The contracts can be negotiated in the Cloud, and the supplier can review and monitor the laying and swimming KPIs agreed upon.

On the Eighth and Ninth Days we are finally finished with birds and are moving into other Labour-based contracts. It is possible that the Ladies could also be encouraged to double up as Maids since the “a-milking” is done in the morning and the dancing is done in evening. It might be worth doing a supplier search on the Cloud for Dairy Workers with appropriate Ballroom skills. The good news is that these enterprises are likely to be women-owned, so this will increase our supplier diversity.

A total of 21 Pipers and Drummers fall seem a little excessive. As Purchasing Agents know, often requesters have little idea of the quantities needed when a request is placed. We could suggest that a smaller number could be sourced initially, and the quantities increase later in the contract. Also, it is likely that the musicians will need to know more details from the requestor, so some form of Cloud Collaboration would be helpful here.

Twelve Lords-a-Leaping is probably the most challenging line item on this requisition. Lords can only be sourced from the UK, and are therefore subject to EU labour regulations regarding the amount of leaping allowed per week. In addition, with leaping not being covered by our workers comp insurance, a review of the suppliers’ safety certificate is suggested. Good news is that Cloud Solutions allow suppliers such as the House of Lords to specify their certifications.

If 2014 has many more Purchase Requisitions like this, then it is probably time to review some of the additional capabilities of Ariba such as Supplier Discovery, Collaborative Sourcing, Performance Management and Services Procurement.

How is the cloud supporting your holiday purchases? Share your story using the hashtag #InMyCloud to connect your comments with others. Follow James on Twitter @JamesMarland.

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1 Comment

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  1. Debra Curtis-Magley

    James – this is a great addition to our #InMyCloud conversation series! It’s a very insightful examination of the complex world that procurement professionals navigate. Thanks for your contribution.

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