Procurement Management Tips

Procurement’s biggest problem is NOT savings, it is invisibility. Stop reporting numbers. Start telling Procurement stories. Procurement Excellence | 04 OCT 2025 - The S.TA.R. framework is a valuable tool for structuring narratives and communicating information effectively. Its concise structure allows for clear presentation of key details, enhancing comprehension. S = Situation: What was the business problem? T = Task: What needed to be fixed? A = Action: Procurement strategic approach. R = Result: Tie outcome to business goals. The S.T.A.R framework turns tactical wins into strategic narratives that resonate with executives. Here’s how: #Situation (The context): ⤷Raw material costs surged 30%, threatening product margins. #Task (Your goal) ⤷Secure stable pricing without compromising quality." #Action (What procurement did) ⤷Partnered with suppliers for long-term contracts + diversified sourcing to 3 new regions. #Result (Quantifiable impact) ⤷Cut costs by 18%, protected $2M in profit, and reduced supply risk by 40%. Why it matters: ✅️Shows you understand the real challenge. ✅️Positions procurement as a solution-driver. ✅️Highlights proactive leadership. When Procurement speak S.T.A.R.... Procurement aligns with CFO goals (cost control) Procurement supports COO priorities (supply chain) Procurement enables CEO vision (growth + innovation) Procurement become the strategic partner to C-suite needs. What’s one procurement #win you could reframe with S.T.A.R? How do you bridge the gap between procurement goals and Exec priorities? Let’s inspire more leaders to speak the language of impact. ♻️ Repost to help your network elevate procurement’s voice. #Procurement #Leadership #SupplyChain #Csuite #STARL

𝟓 𝐏𝐫𝐨𝐜𝐮𝐫𝐞𝐦𝐞𝐧𝐭 𝐋𝐞𝐬𝐬𝐨𝐧𝐬 𝐟𝐫𝐨𝐦 𝐚 ₹𝟏𝟗,𝟕𝟎𝟎 𝐂𝐫 𝐌𝐢𝐬𝐭𝐚𝐤𝐞 What every procurement leader must learn from the JSW–Bhushan Steel chaos 𝗕𝗮𝗰𝗸𝗴𝗿𝗼𝘂𝗻𝗱 : In 2019 JSW Steel won the bid to acquire Bhushan Power & Steel under India’s Insolvency & Bankruptcy Code (IBC). Deal value : ₹19,700 Cr. Funds were infused. Operations taken over. 𝘊𝘰𝘯𝘵𝘳𝘰𝘭 𝘢𝘴𝘴𝘶𝘮𝘦𝘥 𝗕𝘂𝘁 𝗜𝗻 𝗠𝗮𝘆 𝟮𝟬𝟮𝟱: The Supreme Court has canceled the entire deal ❌ Declares the process illegal Orders liquidation instead That’s true a company that JSW ran for years is now off its books Overnight 𝗕𝘂𝘁 𝗪𝗵𝘆 𝗧𝗵𝗶𝘀 𝗛𝗮𝗽𝗽𝗲𝗻𝗲𝗱 ? ⛔ 𝐓𝐢𝐦𝐞𝐥𝐢𝐧𝐞 𝐛𝐫𝐞𝐚𝐜𝐡: IBC allows 270 days. This deal dragged on for over 500 ⛔ 𝐏𝐫𝐞𝐦𝐚𝐭𝐮𝐫𝐞 𝐜𝐨𝐧𝐭𝐫𝐨𝐥: JSW took over without full legal closure ⛔ 𝐏𝐫𝐨𝐜𝐞𝐬𝐬 𝐠𝐚𝐩𝐬: The resolution process lacked statutory rigor 𝘛𝘩𝘦 𝘊𝘰𝘶𝘳𝘵 𝘳𝘶𝘭𝘦𝘥 𝘵𝘩𝘢𝘵 𝘵𝘪𝘮𝘦 𝘦𝘹𝘵𝘦𝘯𝘴𝘪𝘰𝘯𝘴 𝘤𝘢𝘯𝘯𝘰𝘵 𝘫𝘶𝘴𝘵𝘪𝘧𝘺 𝘱𝘳𝘰𝘤𝘦𝘥𝘶𝘳𝘢𝘭 𝘷𝘪𝘰𝘭𝘢𝘵𝘪𝘰𝘯𝘴 𝐖𝐡𝐚𝐭 𝐓𝐡𝐢𝐬 𝐌𝐞𝐚𝐧𝐬 𝐟𝐨𝐫 𝐘𝐨𝐮 𝐀𝐬 𝐀 𝐏𝐫𝐨𝐜𝐮𝐫𝐞𝐦𝐞𝐧𝐭 𝐋𝐞𝐚𝐝𝐞𝐫 : This is a brutal real-world case study in contractual discipline and risk management. 1️⃣ 𝗗𝗲𝗮𝗱𝗹𝗶𝗻𝗲𝘀 𝗮𝗿𝗲 𝗟𝗔𝗪 — 𝗡𝗼𝘁 𝗦𝘂𝗴𝗴𝗲𝘀𝘁𝗶𝗼𝗻𝘀 Contracts with statutory or regulatory timelines must be treated as non-negotiable. 2️⃣ 𝗟𝗲𝗴𝗮𝗹 𝗖𝗹𝗼𝘀𝘂𝗿𝗲 > 𝗢𝗽𝗲𝗿𝗮𝘁𝗶𝗼𝗻𝗮𝗹 𝗖𝗼𝗻𝘁𝗿𝗼𝗹 Never take charge of suppliers, assets, or projects until contracts are 100% sealed and validated. 3️⃣ 𝗣𝗮𝗽𝗲𝗿 𝗧𝗿𝗮𝗶𝗹𝘀 𝗣𝗿𝗼𝘁𝗲𝗰𝘁 𝗬𝗼𝘂 Assumptions don’t win in court. Documentation does. 4️⃣ 𝗜𝗻𝗰𝗹𝘂𝗱𝗲 ‘𝗪𝗵𝗮𝘁-𝗜𝗳’ 𝗖𝗹𝗮𝘂𝘀𝗲𝘀 𝗶𝗻 𝗛𝗶𝗴𝗵-𝗦𝘁𝗮𝗸𝗲 𝗖𝗼𝗻𝘁𝗿𝗮𝗰𝘁𝘀 Always draft contingency, rollback, and reversal clauses — especially in M&A, Capex, or long-term supply contracts. 5️⃣ 𝗚𝗼𝘃𝗲𝗿𝗻𝗮𝗻𝗰𝗲 𝗶𝘀 𝗡𝗼𝘁 𝗕𝘂𝗿𝗲𝗮𝘂𝗰𝗿𝗮𝗰𝘆 — 𝗜𝘁’𝘀 𝗜𝗻𝘀𝘂𝗿𝗮𝗻𝗰𝗲 Be the leader who slows down when it matters. Because speed without structure kills deals. Have you seen contract risks like this in your industry? #JSW #bhushansteel #India #Contract #Contractdrafting #Purchsing #Procurement #Industry #Mergerandaquisition #Riskmanagement #Leadership #CXOinsights #SMARTProcurement #ContractRisk #SCM

The Pentagon Just Handed American Drone Startups a $1 Billion Golden Ticket On July 10, SECDEF dropped a memo that changes everything for drone manufacturers. Combined with Trump's June 6 executive order, we're witnessing the most radical shift in defense procurement since World War II. Here's what just happened:  The Pentagon ripped up years of red tape that kept innovative companies out of defense contracts. Now they're treating small drones (under 55 pounds) like ammunition - expendable, mass-produced, and urgently needed. The numbers are staggering: • Every Army squad gets attack drones by FY2026 • Production target: Millions of units annually • Weaponization approvals: Cut from years to 30 days • Battery certifications: Down to one week For companies eyeing this opportunity, here's your roadmap: Step 1: Compliance First (Immediate) Ensure NDAA compliance - zero Chinese components. Review the Blue UAS Framework. This isn't negotiable. One foreign chip kills your entire opportunity. Step 2: Prototype Fast (12-18 months) Build modular systems under 55 pounds. Think swappable payloads for ISR or strike missions. The 18 prototypes showcased on July 17 averaged 18 months of development vs. the traditional 6 years. Step 3: Get Certified (Ongoing) Apply to DIU's Blue UAS program. This is your fastest path to approved vendor status. The memo expands this list with AI-managed updates coming in 2026. Step 4: Find Your Entry Point (30-90 days) • Respond to the Army's July 8 solicitation for low-cost systems • Partner with established primes as a subcontractor • Target frontline units are now empowered to buy directly Step 5: Scale Smart (By 2026) Secure private funding. Explore DoD purchase commitments. Participate in the new drone test zones launching in 90 days. The brutal reality? We're playing catch-up. China produces 90% of commercial drones globally. But that's precisely why this opportunity exists. The Pentagon needs American manufacturers desperately. Watch for these challenges: • Supply chain constraints for non-Chinese components • Fierce competition from AeroVironment and Kratos • Higher production costs vs. Chinese competitors • Maintaining cybersecurity while moving fast Stock prices tell the story - drone companies surged 15-40% after the announcement. Private capital is flooding in. America is building a new arsenal, and drones are the foundation. If you have manufacturing capability, AI expertise, or can build at scale, this is your Manhattan Project moment. The difference? This time, we know exactly what we're building and why. The window is open. But it won't stay that way.

Supply Chain Excellence Grid : Stop Guessing, Start Assessing and Acting Many companies talk about SC maturity, but few have mapped every step required for true transformation. Progress isn’t about gut feel, it’s about continuous assessment across every domain, with practical, measurable actions. Here’s my go-to reference, a grid (roadmap) that Supply Chain professionals can use to benchmark and drive improvement: 1️⃣ Strategy Is your supply chain strategy documented, aligned to business goals, and fully cascaded? Are KPIs reviewed, leadership engaged, and a true culture of continuous improvement embedded from the top down? 2️⃣ SC Planning Do demand and supply plans actually sync? Is forecast accuracy measured and used? Is production planning data-driven, and contingency planning a routine practice? 3️⃣ Sourcing Are supplier selection and performance reviews standardized? How strong is your risk management, and are strategic partnerships and audits routine, driving improvement, not just compliance? 4️⃣ Customer Management Is order processing fully interfaced with core systems? Can customers see real-time order status and give feedback? Are SLAs meaningful, and do you manage exceptions when things go off track? 5️⃣ External Logistics Do you track carrier qualifications, shipment visibility, freight optimization, and transport risks with IT-driven integration? 6️⃣ Internal Logistics Are internal workflows mapped (5S, VSM), tools like AGVs/RFID deployed, bottlenecks analyzed, and staff regularly trained? 7️⃣ Warehousing Are warehouse layouts efficient? Is WMS active? Are cycle counts robust, picking accuracy tracked, and safety audits punctual? 8️⃣ Inventory Management Is inventory tracked by SKU/location, safety stock policy reviewed, obsolescence managed, and physical counts reconciled? 9️⃣ Materials Planning Are requirements model-driven, MRP reviewed, supplier lead times monitored, and shortages systematically tracked? 1️⃣0️⃣ Production Is schedule adherence a daily metric? Are quality/yield KPIs, flexibility, and root-cause analysis at the heart of your daily routine? 1️⃣1️⃣ Delivery Planning Is delivery planning tightly integrated, last-mile tracked, routing/scheduling tools leveraged, and communication seamless? 1️⃣2️⃣ Aftermarket, Sustainability Are returns standardized, sustainability metrics tracked, reverse logistics launched, and waste measured? 1️⃣3️⃣ Technology Are ERP systems deployed? Is data accurate, dashboards used for decisions, integration strong, and upgrades routine? 1️⃣4️⃣ People & Organization Are skills matrices, R&R standardized ? Is change management supported, and engagement measured? Every domain offers practical checkpoints, more than theory, they’re action items for building resilient, future-proof supply chains. If you aren’t measuring maturity, you’re missing out full potential of Excellence. *Like, leave a meaningful comment (leaving email address is NOT a comment) & message me within LinkedIn to get file

I keep seeing procurement teams blamed for being slow or reactive. But how often are we actually brought in early enough to make a real difference? But the uncomfortable truth is that most procurement problems are not capability problems. They are timing problems. When procurement is involved late, the work turns into cleanup. → Requirements are already locked → Suppliers are already “preferred” → Timelines are already unrealistic → Risk is already baked in → And procurement is asked to fix it anyway That is not strategy. That is damage control. I have seen the opposite work incredibly well. When procurement is involved early, however: → Tradeoffs are discussed, not discovered → Risk shows up while there is still room to act → Suppliers are shaped instead of rushed → Contracts are designed, not patched → AI supports decisions instead of amplifying chaos → And speed actually improves Early involvement does not slow the business down. It removes the rework no one talks about. If you want procurement to be strategic, stop treating it like a final checkpoint. Bring it in upstream. That is when procurement stops reacting. And starts doing the work it was hired to do. Repost 🔁 to share with your network or follow me, Marijn Overvest, for daily procurement inspiration. PS: Stop wasting hours on generic procurement training. Join Procurement Tactics for role-based learning journeys that turn ambitious teams into strategic partners — every minute counts.

CFO: "You delivered £10M savings. Next year we'll make your target £12M." Procurement: "Okay, we'll do our best" 🤷♂️ That trap that turns smart procurement leaders into basic purchasers. That isn't strategy. It's wishful thinking. Here is the problem: When Procurement exists only to deliver a number, everything else collapses. → Savings without context are risky. → Savings without TCO or risk weighting are misleading. → Savings without value creation, capability building, supplier performance or ROI are pointless. And when teams deliver against unrealistic targets, those targets only get bigger. The credibility trap tightens. I've seen this too often. Savings get harder year on year. → Short term cuts appear. → Bad decisions sneak in. → Category maturity is ignored. → Supplier performance is sacrificed. → The business pays more in the long run. There is a better way. A more grown up way. — Try this instead in your objectives setting: 1. Define your vision and strategy ➟ Why does Procurement exist for this business? ➟ Where do you want the function to be in two to five years? ➟ What is your unique value? 2. How do you create value beyond cost? A clear strategy stops the team drifting into reactive purchasing. ➟ Align your objectives with the business ➟ Interview stakeholders. ➟ Map problems and aspirations. ➟ Understand commercial priorities. When your objectives reflect the real needs of the business, you stop chasing artificial targets and start unlocking real value. 3. Deliver a multi tiered value matrix Any function measured on a single metric will eventually fail. Track the value that actually matters: ➟ Cost. ➟ Value and ROI. ➟ Risk mitigation. ➟ ESG impact. ➟ User feedback. ➟ Supplier performance. If the business only sees savings, that's because Procurement only talks about savings. 4. Push back on poor behaviour Respect your stakeholders but don't be ruled by them. ➟ Challenge bad assumptions. ➟ Call out unrealistic expectations. ➟ Have the uncomfortable conversations. ➟ This is what separates a strategic function from an order taker. Here's the truth most teams avoid: Procurement doesn't fall into the savings trap because the answer is complicated. It falls in because the trap is comfortable. It's easy to chase a number. It's harder to define value. It's harder to change expectations. It's harder to lead. But the teams that escape the trap become the teams that transform their organisations. Any ideas why so many still stay stuck? —— P.S. want to join 22,000+ procurement pros getting FREE insights from me every week? Join here https://procurebites.com/

Category mapping in procurement is highly significant because it plays a key role in organizing, analyzing, and managing purchasing activities effectively. Here's why it matters: 1. Visibility and Spend Analysis Category mapping helps organize purchases into logical groupings (like IT, office supplies, logistics), making it easier to: . Track spending patterns . Identify opportunities for savings . Detect inefficiencies or maverick spend (unauthorized purchases) 2. Strategic Sourcing . By mapping procurement items into categories, companies can: . Develop targeted sourcing strategies for each category . Consolidate suppliers or volume for better negotiations Benchmark performance within categories 3. Supplier Management . It enables better supplier oversight: . Know which suppliers serve which categories . Reduce supplier risk by diversifying across categories Improve supplier performance tracking 4. Compliance and Risk Management Category mapping supports: . Policy enforcement (e.g., approved vendors by category) . Risk assessments specific to category (e.g., cybersecurity risks in IT purchases) 5. Procurement Planning and Budgeting It aids in forecasting and budgeting: . Predict future spend by category . Align procurement plans with business goals . Make informed investment decisions 6. Process Efficiency Automated procurement systems rely on well-mapped categories for: . Workflow routing (e.g., approvals, PO generation) . Catalog management . E-procurement and system reporting

Procurement is more than just buying. But for many it’s become a race to the bottom when it shouldn’t be. Don’t get me wrong. Cost reduction is needed. Strategic sourcing is needed. Contract performance management is needed. But at times, the race to the bottom overtakes everything else. Procurement isn’t: -Hammering your suppliers until they break -Obsession over the “spreadsheet” that “tracks everything” (but tracks nothing) -Acting like the spend police -Demanding a seat at the table 🤮 -Complaining that you weren’t involved early on -Pushing away the emergence of procurement tech and AI If you’re doing these your destined for extinction. Procurement is: -Communicating with your colleagues and storytelling so that your colleagues hear what you have to say. Too many procurement teams are circumvented because they cannot explain why they are in the process. -Aligning with the business. Any decision you make must be aligned to the overall business goals. -Connecting the dots across the organisation to make sure everyone is aligned with every supplier activity. -Driving the why behind every sourcing decision. Why do we need this? What are we solving with this sourcing activity? And then making it a reality. -Reducing costs where possible in a sustainable way with your suppliers that doesn’t alienate them. -Extracting the full value out of your supplier contracts ensuring those savings and all the goodness you’ve secured isn’t eroded. -Utilising technology to centralise data that you can then use to power all future procurement, contract management, and risk management activities (data is the fuel). -Keeping up with the rest of the business as they explore new tech, experiment with AI, and find new ways of working. -Optimising your efforts and being focused on a small portion of your supplier base to drive value through your business. If you’re managing thousands of suppliers, you’re managing none. -Understanding the broadening of procurement’s role and figuring out what you can do with what you have (e.g. small team that is powered with tech to do more). -Reducing risks within the supply chain at every opportunity. Every phase of the procurement lifecycle has risks and the types of risks emerging are scarier and harder hitting than ever before. Procurement is getting tougher. It’s only going to get tougher for those who cling to the past. For those who don’t use tech to augment their ability. What are your thoughts on this 👇💬

Big news in the drone world. The Department of Defense recently released a memo titled “Unleashing U.S. Military Drone Dominance”. It's not just policy. It's a mandate to scale. Here are the key takeaways: 🚀 Authority to Operate (ATO): Now delegated to O-6 and below for NDAA-compliant small drones. 📋 Blue UAS gets a revamp: O-6s can nominate drones to the Blue List. DIU hands off to DCMA in 2026. 🎯 Large UAS procurement accelerated: GO/SES can greenlight large drone purchases + certifications using DIU/DCSA checklists. 🪖 Small drones reclassified as consumables: No more durable goods classification. Small UAS are now "consumable commodities", munition-grade expendables. ⚔️ Weapon boards held accountable: Must respond to arming requests within 30 days. 🏹 Training: Installation commanders mandated to facilitate UAS training, with national test ranges and large-scale integration planned by 2027. 📍 Dedicated test ranges & integration events: coming online by 2027. 🏛️ New UAS forces & offices: Stood up immediately to coordinate the surge 💰 Capital acceleration plans coming: Office of Strategic Capital & DOGE presenting financing options within 30 days to accelerate the growth of the U.S. drone industrial base The message is clear. Unmanned systems are no longer “adjacent”, they’re central to modern warfare. Founders, integrators, investors: If you’re building drones, the red tape is starting to get hacked away. Let’s fly 🏴☠️