We believe that by running procurement as if it were a for-profit business can lead to exceptional results. This presentation covers how to change your mindset and model your approach after high-performing consulting firms.

1. Why You Should Run
Your Procurement Organization
Like a Consulting Firm
September 24, 2018 | Scottsdale, AZ

2. About Insight Sourcing Group
The top boutique consulting firm focused exclusively on strategic sourcing & procurement.
Headquartered in Atlanta, GA
120 US-based Sourcing Consultants
4x – 10x ROI for Clients
4,500+ Sourcing Projects Completed
2018 #1 Most Innovative Firm (Vault.com)
2018 #1 Boutique Firm (Vault.com)
11x Inc 5000 Fastest-Growing Private Co.
11x Best Place to Work in Atlanta
Learn more at insightsourcing.com
Award-winning
spend analytics data
optimization &
SaaS technology
Group purchasing
programs for indirect
categories to drive
rapid savings
Energy
supply & demand cost
optimization solutions
Strategic Sourcing &
Procurement Transformation
Consulting Services
Post-sourcing
savings realization
services & technology

3. Scenario:
What would YOU do?
insightsourcing.com | @ISG__Sourcing

4. insightsourcing.com | @ISG__Sourcing
City A City B
You are running this airline.

5. Procurement is that airline!
A 2018 ISG study of mature procurement organizations showed that on average…
31%
Percent of time organizations focused on
strategic activities
Percent of addressable spend influenced
by procurement
32%

6. insightsourcing.com | @ISG__Sourcing
We’re a lot alike…
Procurement Org. Consulting Firm
Have to “sell” services
Must have high ROI results
Operate in complex environments
Don’t own the ultimate decision
Have to execute efficiently

7. insightsourcing.com | @ISG__Sourcing
The DNA of a High-Performing
Consulting Firm
Win the War
for talent
1
Sell based
on Value
2
Execute
Efficiently
3
Deliver
Great
Results
4

8. Winning the War for Talent
insightsourcing.com | @ISG__Sourcing
1
2
3
4
Relentless Recruiting
Defined Career Path
Development Commitment
Cultural Awesomeness
Tough Decisions

9. insightsourcing.com | @ISG__Sourcing
Value-Based Selling1
2
3
4
She understands
what I value!
Artful listening
Invest time
Appeal to both brains
Frame value in terms
specific to customer
Outcome-focused, not
offering-focused

10. insightsourcing.com | @ISG__Sourcing
Excellence in Execution1
2
3
4
Prioritize work
Maintain high utilization
Jettison tactical activity
Establish organizational data
Eliminate write-offs

11. insightsourcing.com | @ISG__Sourcing
Deliver Great Results1
2
3
4
Meets /
exceeds
commitments
Measurable /
believable
results
Guarantee
work

12. insightsourcing.com | @ISG__Sourcing
But are these
attributes measurable?
Win the War
for Talent
Sell based
on Value
Execute
Efficiently
Deliver
Great
Results

13. insightsourcing.com | @ISG__Sourcing
YES – THEY ARE!
Win the War for talent
Sell Based on Value
Execute Efficiently
Deliver Great Results
Primary Metrics Secondary Metrics
Unmanaged Attrition
Win Rate
Utilization
Effective Rate
Employee Survey
Net Promoter Score
Individual Utilization
Customer Effective Rate
Utilization
Effective Rate

14. Consulting X Factor Metrics
Utilization and Effective Rate are two metrics that drive prioritization and management attention
insightsourcing.com | @ISG__Sourcing
Effective Rate & Utilization Trending Effective Rate by Client
$

15. insightsourcing.com | @ISG__Sourcing
Procurement can have similar metrics
Win the War for talent
Sell Based on Value
Execute Efficiently
Deliver Great Results
Primary Metrics Secondary Metrics
Unmanaged Attrition
Spend Under Management
Utilization
Effective Savings
Employee Survey
Net Promoter Score
Individual Utilization
Project Effective Savings
Utilization
Effective Savings

16. How To Think About X Factor Metrics
insightsourcing.com | @ISG__Sourcing
Example: 10 person team w/ $10M savings target
• Each person has 2,080 hour per year
• @ 70% Utilization = 1,456 effective hours
• 10 FTEs = 14,560 effective hours
• $10MM savings target / 14,560 hours = $687 / hr
Effective Savings Target
70%
Utilization Target

17. How To Manage Without Timesheets
insightsourcing.com | @ISG__Sourcing
Before Each Project During Each Project After Each Project
• Estimated Duration (weeks)
• Estimated Savings ($)
• Estimated Staffing (% FTE)
• Estimated Effective Rate
• Forecast Duration (weeks)
• Forecast Savings ($)
• Forecast Staffing (% FTE)
• Forecast Effective Rate
• Actual Duration (weeks)
• Actual Savings ($)
• Actual Staffing (% FTE)
• Actual Effective Rate
Establish a Project Database
Hold weekly management meetings to update forecasts
• Update strategies and priorities accordingly
.
Publish individual and group X-factor metrics frequently
.
Refine estimating capability
1.
2.
3.
4.

18. Change your mindset.
Running your organization like a for-profit
business will enable you to consistently deliver
exceptional procurement results
insightsourcing.com | @ISG__Sourcing
Today’s key takeaway:

19. Thank you!
Doug Van Wingerden
Senior Vice President
dvanwingerden@insightsourcing.com
(770) 628-0028
www.insightsourcing.com
Have specific questions? Visit my roundtable tomorrow at 4:35pm!