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Wrapping up another very successful Future of Contracting series webinar, there were some additional questions not covered.  In case you missed the last webinar held on December 4th, please tune in to the replay!  Leveraging the International Association of Contract and Commercial Management (IACCM)'s maturity model, attendees got to hear the varying levels of contracting maturity and how to advance to the next stages.  Mentioned in our last post, Know Where Your Company's Level of Contracting Maturity Is, we mentioned a very simple and intuitive assessment tool that takes only a few minutes to complete and gives a preview of your company's contracting maturity level.  Our speakers included:

  • Tim Cummins, CEO, International Association of Contract and Commercial Management (IACCM)
  • Dan Ashton, Sr. Solutions Marketing Manager, Ariba, an SAP company

 

Q: If our company is currently at the silver level, what programs, services, operating systems, etc would you recommend for us to get to the gold level and how long should we expect to achieve a gold level that is sustainable enterprise-wide?

Tim: Typical weaknesses tend to be the difficulty the organization has in ensuring strategic alignment between business goals and its contracting process and competencies.  These alignments depend on the critical issues of leadership; close connection to the financial (economic) impacts of contracting; creation and use of data/analytics (with appropriate technology). These observations draw on or typical findings; of course you may have some variants. We would be happy to discuss in more detail.

 

Q: Is the 9.15% savings applicable to "buy-side" contracts?  And does your report have specific info for buy-side contracts?

Tim: The data is a corporate view, so buy and sell.  The percentages vary siginifcantly between indsutries.  For exmaple, on buy side there is far greater leakage on contracts where value depends on outputs or outcomes -- so essentially it is services, solutions and capital projects where the biggest losses occur.  This means in a sector like oil and gas, the costs exceed 15%; in a sector like retail it is more like 4%.

 

Q: Do you offer any services that allow us to benchmark our self-assessment?  For example, we rated ourselves a Stage 2 or 3 but we may not be so advanced from an external view.

Tim: Yes, we can assist with this.  Contact tcummins@iaccm.com and I can offer more details.

 

Q: How does Ariba or other systems interact with large enterprise management systems, e.g., SAP?

Eric: Ariba integrates with virtually any ERP system, and best of all SAP, since we are now part of SAP!  Many of our customers port over legacy contracts from multiple disparate ERP instances and benefit by having them in one, centralized searchable repository.  The real beauty of integration isn't necessarily to the ERP instance but to other procurement modules.  When sourcing is connected to contract management and procurement, possibly flowing as far as  P2P or e-Invoicing solution, the maximum benefit is yielded from contract mgmt because of the auto-population of information and added compliance from the pre-set configurations.

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