Procurement & Career Guidance
The Request for Proposal (RFP) is one of, if not THE most important tool in a procurement professional’s toolbox.
In this high inflation period which is driving up costs, the RFP is the best way to test market pricing and understand price points.
This video discusses why it is so critical to leverage and the issues customers and suppliers have with organizing a proper RFP.
When asked what they do to preserve and strengthen workplace culture, HR professionals and managers were on the same page, listing “training and development” (72 percent and 61 percent, respectively) and “getting feedback from employees and acting on it” (45 percent and 46 percent) as the two top strategies.
This is not a good thing to do. A company with a reputation for putting its potential suppliers though RFP hell is not one that many suppliers will want to deal with. The more a supplier’s peers complain about RFP hell with Company X, the fewer are the suppliers who will even acknowledge the existence of an RFP from Company X. As the word of RFP Hell from Company X spreads, the only suppliers that will respond to an RFP from Company X are those that are desperate. Those in bad financial shape, those without a stable customer base, and those with a bad reputation. These are not suppliers you want to deal with.
http://sourcinginnovation.com/wordpress/2016/04/03/why-create-rfp-hell/
Customers must perform a gap analysis between the vendor’s offering and the customer’s requirements to identify gaps and determine whether they can be covered by either party. In addition, narrow limitations of liability—frequent in cloud contracts—can warp the incentives for protection against cyber risk. While there has been a significant growth among sophisticated cloud vendors who are able to address their customers’ data protection and compliance requirements, there is still substantial variation among cloud vendors’ ability to adequately address such requirements.
Also:
The key contractual provisions to mitigate cyber risk are: (1) the security standards required of the vendor; (2) restrictions on subcontracting; (3) employee related protections, such as background checks and training; (4) security testing; (5) security audits; (6) security incident reporting and investigation; (7) data retention and use restrictions; (8) customer data access rights; and (9) vendor liability for cyber incidents.
A recent study by CIRANO found that while there is an 80% chance of a company losing at least 20% of its value at least once during a five year period as a result of a negative, but well publicized, incident, a major incident that negatively impacts the brand in a significant way can be much worse. Just ask Airbus that had its stock plummet by over 26% in a single day, equivalent to a market capitalization loss of approximately €5.4 Billion, after it announced on the close of trading on June 13, 2006 that issues with the supply and installation of electrical harnesses would lead to a further six-month delay in the delivery of the A380 (and that the impact of the disruption on earnings before interest and tax would be €500M per year for four years).
“To compete and win in today’s global economy requires digital supply chains that are connected, agile and intelligent,” said Alex Atzberger, President, SAP Ariba. “In joining forces, SAP Ariba and PrimeRevenue can create a closed-loop system that links all of the data companies need to manage transactions and supply chain financing events with greater insight, speed and simplicity than ever.”
Photo: Calib Frith