Two white papers about supply market intelligence (SMI) correctly emphasize both the importance of SMI for strategic sourcing/procurement and the difficulty of actually obtaining the high quality information that is needed. Accenture’s white paper, The Market Intelligence Opportunity correctly states, “With increasing end-market volatility and financial pressure on companies to do more with less, the need for world-class procurement is more pressing than ever. But building world-class procurement—and the market intelligence capability to support it—is a challenge even for the most resourceful organizations.” Tata’s white paper, Driving Strategic Sourcing Effectively With Supply Market Intelligence states, “CPOs, procurement specialists and category managers will agree that it is a challenge to collect high quality, valuable supply market information across a supply chain network, as it involves subscribing to costly industry journals or pushing category managers to spend huge amounts of time on gathering knowledge from a large number of sources. In short, it results in procurement personnel spending huge amounts of time on gathering knowledge.”
If SMI is difficult for “world-class” procurement departments, imagine how challenging it must appear to be for professionals in smaller procurement departments with limited resources. These professionals often deal with budgets that are stretched thin and challenged with managing several spend categories. But the good news is that supply market intelligence is an initiative that can be achieved with success for any spend category or market regardless of budget size or restraints on time.
To accomplish this, there are tactics to use based on these two premises:
1) To address the issue of working with a limited (or zero) budget, learn and take advantage of open access (free) resources and the experts, institutions, and organizations that offer them.
2) To address having limited time, master the skills of basic research. This knowledge is empowering in so many ways, mostly in knowing how to extract key, relevant information in an efficient manner. There are basic skills that can be applied to any research activity, whether it is via the Internet, open web, or carried out using commercial services.
With departments that have larger budgets, the first premise expands to include taking advantage of the best value information sources that are of high quality, meet a particular need, and are authoritative and impartial (to be covered in other posts).
PREMISE ONE: TAKING ADVANTAGE OF OPEN ACCESS RESOURCES
Issue 1 – Identifying the Best Open Access Resources To Use
There is no doubt that there is an abundance of research resources available for supply market intelligence. These resources are either accessed via open access (free) channels or via fee-based third party providers. The data and intelligence offered by most fee-based providers are worth the price and decision-making should be based on quality, authoritative information. There are, fortunately, high quality, open access resources available. Below represents a sampling of the types of resources and organizations that offer credible, open access information.
U.S. Government – The U.S. government publishes a great deal of excellent market data information that is of value to procurement professionals. In addition, government experts, such as commodity specialists, are knowledgeable and helpful with providing updated data. Contact information is available on web pages where information is presented. A few examples:
- Wage data, Producer Price Index – U.S. Bureau of Labor Statistics
- Energy data- U.S. Energy Information Administration (EIA)
- Public company filings – U.S. Securities and Exchange Commission (SEC)
- Agriculture markets data – U.S. Department of Agriculture through the National Agriculture Statistics Service (NASS) and the Economic Research Service (ERS)
- Minerals commodities – U.S. Geological Survey
Associations, Organizations, and Councils – Trade associations; national and world organizations, such as The World Bank; and councils, especially commodity councils, such as U.S. Grains Council, are prolific publishers of free information. Their websites often times provide resource centers where you can access background information, buyer’s guides, daily news, market data, links to other related sources, and industry trend and forecast reports.
Trade and Industry Publications and Their Corresponding Websites – Just as there is a professional association for about every industry/market, there is also a journal. All journals have websites with most of them posting in varying degrees, free articles, buyer’s guides, updated market news, market prices, and industry trends and forecasts.
Blogs – Many market and analyst research firms introduce new research and key summary information via accompanying blogs. Blogs written by the analysts and experts that follow a certain market, service, or product, combine news events with analysis, thus providing enriched intelligence.
Third-Party Information Providers – Many providers generously offer access to free information. For example, Cortera offers free monthly industry monitoring reports that show measures of key purchases and payment/financial trends in major US industries, and Datamyne’s Free Report Library makes available import and export trade activity data. The LME (London Metal Exchange) Free Data Service makes available official prices, opening stocks, daily index value, monthly averages, and price graphs for non-ferrous metals, steel, and minor metals.
Consulting Firms – Most consulting firms publish thought leadership and industry trend pieces. For example, Accenture publishes a quarterly report that summarizes the top market trends affecting major spend categories.
Market Research Reports – Sometimes the executive summary of a market research report covers key findings that can be a springboard to other research avenues. For example, many summaries will list the companies covered in the report. This reveals the competing players in the market and from here you can further investigate using open access company databases. Many providers now sell their reports by page or segment, which greatly reduces the cost by allowing you to purchase key sections of needed information only.
Company and Industry Databases Commonly Available Via Public Libraries:
- Reference USA – Listings for 24 million U.S. business locations
- EbscoHost Business Elite/Complete – full-text articles or abstracts from newspapers and business journals; company, SWOT, and industry reports
- Hoover’s – public and private company information
- Mergent Online – U.S. and international company financials
- Standard & Poor’s NetAdvantage – industry surveys, company profiles
- Regional Business News – full-text business publications, on a regional level (good for private company research)
Issue 2 – Where to Go When You Have No Idea Where to Start
- Information Centers. First investigate if there is an information center/corporate library in your organization. If you are part of a larger organization, investigate if there is an information center or library that serves at the organization-wide level. If that is not available, contact the business librarian at your local public library. The larger the population that the library serves, the more resources will be available to you. Also check with your local university or college library. UNLV Libraries, for example, offers open access to many of their business databases, including Factiva and IBISWorld.
- Discussion Groups/Forums. These can be located and identified through LinkedIn (do a search to find a relevant group to join), social media channels, professional associations, trade publications, and consortiums
- Professional Associations. These are so important for many reasons. Not only can you take advantage of contact information to experts, but most have discussion forums.
- Firm-Wide Resources. Investigate any firm-wide subscriptions your company uses. Many companies subscribe to at least one resource like LexisNexis, Factiva, or Hoover’s. Departments that use these types of resources are Marketing, Research and Development, and Legal.
- Procurement Blogs such as Spend Matters and My Purchasing Center
- Trusted Colleagues
- Internal Stakeholders
PREMISE TWO – LEARN BASIC RESEARCH TECHNIQUES
Here are basic skills that can be applied to any research activity that leads to economy of time and successful searches. Also refer to this earlier post: The Procurement Professional As Researcher: Research Skills 101.
Tip #1 – It’s all about the search results. By learning some very basic tricks, you can produce fewer results that are current, relevant and on target. The number one time waster when researching is slogging through large numbers of irrelevant or bad “hits.”
Tip #2 – Relax. Do not allow panic, frustration or stress paralyze you. Successful research is about careful reading. Once you relax and start reading, your mind will automatically start making connections between what you need and what you are reading.
Tip #3 – Don’t research when you are tired. It’s difficult to read carefully if you are unable to focus.
Tip #4 – Get the terminology right. Brainstorm and identify various keywords and terms that can be used before starting to search.
Tip #5 – The Find command is your best friend. When first reading a multi-page document, article, or report, use a browser’s or document’s Find command to highlight and jump to where your keyword or search term appears. This technique drastically saves time (and your eyes) when determining if the document meets your needs.
Tip #6 – Document as you go. It is much more efficient to document a possible source before moving on to the next one than it is to relocate that source later.
Tip #7 – Limit and refine search results. When using a search engine like Google or a commercial database, utilize all tools that allow you to limit and refine results. If you remember one thing about searching, remember this: Take advantage of the advance search features offered by the search engine or database. These features:
1. offer various ways to narrow and refine search results
2. allow searching for words in the title only, guaranteeing relevant results
3. allow narrowing the date range to meet specific events or eliminate old results
4. identify appropriate and alternative subject terms or terminology to use
Tip #8- Use Boolean operators. Don’t let the word “Boolean” intimidate you.
- Use AND to narrow results. A search for “supplier” AND “manufacturer” will retrieve articles that contain both of those terms. Some sites, such as Google, automatically apply the AND operator.
- Use OR to expand results. A search that includes “supplier” OR “vendor” will retrieve articles that have at least one of those terms. Also, use OR if there are different ways to enter a term: “IBM” OR “International Business Machines.”
Tip #9 – Use other key operators and symbols.
- Use an asterisk (*) to find all forms of a search term. For example, a search for “hack*” will find hacks, hacker, hacked, hacking, etc. With Google, the asterisk functions as a placeholder.
- Use quotation marks (” “) to indicate that you want results that contain the entire, exact phrase. For example, searching for “market share” with quotation marks will find results that discuss the market share of a company rather than results that contain both words individually.