Episode 12: Changing the Sourcing Game
By Katherine McCleery | December 14, 2020
Generally speaking, every procurement professional I’ve spoken to or interviewed for this show is highly intelligent with bits of wisdom seeping from each sentence. This episode is no exception, and I’d go as far to say that Edmund Zagorin is right at the top. He’s got a unique perspective as the CEO and founder of Bid Ops, having solved for a major gap in strategic sourcing with their game-changing platform.
He’ll share how they’ve helped customers shine through the pandemic, the vision that founded the company, and where they are headed next. Oh, and Edmund reveals what he believes will be the biggest factor in the success of procurement’s future. Don’t miss this one!
[01:42] How has the pandemic affected Bid Ops?
[05:47] How customers have been adjusting
[09:28] What is a sourcing hero to Edmund?
[11:48] The developing idea behind Bid Ops
[14:39] Bid Ops in a nutshell
[16:56] Optimizing for efficient price negotiations
[19:15] Words of wisdom from Edmund for up-and-comers
[24:45] Procurement majors at universities
[26:19] What’s next for Bid Ops
The sourcing hero according to Bid Ops and Edmund
Edmund says the sourcing hero is a team that is able to deliver a critical product or service to meet a business need at the right time and at the best price. There’s an old saying in film and video about sound recording, if it’s perfect, no one notices it. You will notice if a movie has poor sound quality or poor sound recording but very few people ever watch a movie and say, “wow, that sound recording was just beautiful.”
Similarly, the heroism of sourcing is often that when it’s working you don’t notice it, it’s just the right stuff is showing up at the right places and the business seems to have enough money in the bank. What’s so important about sourcing heroes is that they deliver on a project basis and they deliver at scale. It’s not just about coming through in the clutch. It’s about being that reliable, trusted partner to the business who understands the strategic vision and isn’t just trying to step over a buck to pick up a penny.
The driving idea behind the creation of Bid Ops
Bid Ops came out of this idea of total cost of ownership and value analysis being fundamental to the future of procurement. The idea is that procurement is always looking to play the role of a trusted advisor and align with the strategic priorities of the business. One of the reasons why business leaders in some cases may have a negative view of procurement is because it is not a core business purpose of most companies to save money. Business leaders will say, we’re trying to grow revenue, we’re trying to expand our market, or we’re trying to compete against X, Y or Z company as top priorities, but saving money is not listed as a core business function. But it is the KPI that procurement is most usually graded against.
Future offerings from Bid Ops to get excited about
One of the priorities from a technology standpoint is actually taking our machine learning model and abstracting it away from our software product to provide additional value in the form of reporting. We’ve been able to take our machine learning model and train it on data from an entire supply chain. This model can now accurately classify a line item as shouldn’t negotiate, it can estimate the amount of savings for each line item, and it will do this in a unique way based on whether or not the line item is the sole source or if there’s competition for it based from multiple suppliers. Perhaps most importantly, it componentizes the price based on the lead time, minimum order quantity, and other column attributes. It also localizes and chronologies is the price based on the time of year and the geography. This is going to enable our customers to pitch the value of procurement more effectilvy to their business partners. Check out the episode for more info on this exciting expansion Bid Ops will be offering!