Cognitive Sourcing Maturity Assessment

1. How often are sourcing professionals sent for training and continuing education?

Informally

Annually

1-2 times per year

Quarterly

Continuously

2. What percentage of total direct materials spend is strategically sourced / managed (vs. the "tail spend")?

30 - 50%

50 - 75%

75 - 90%

90%+

3. What is the frequency of scheduled sourcing events or RFQs per year?

Primarily ad hoc, not executed on a regular pre-defined schedule

Primarily Annual events with most suppliers

Quarterly events for key sub commodities or groups of suppliers.

Weekly events executed for key sub commodities or suppliers.

Continuous sourcing with suppliers or sub commodities as needed based on market conditions.

4. What percentage of total suppliers participate in a sourcing event or competitive bid process at least once a year?

30 - 50%

50 - 75%

75 - 90%

90%+

5. What percentage of time do sourcing professionals spend "putting out fires?"

0-5%

5-15%

15-25%

25-50%

50%+

6. As an organization, how do you measure effectiveness and performance of the strategic sourcing function?

Informal - Develop informal goals at category level and goals are subject to change.

Annual Cost Savings Focused - Year over year goals are primarily savings focused, are based upon previous experience and driven from leadership.

Sustainable Cost Management - Targeted cost savings looking at longer term and sustainable cost management dynamically tied to industry benchmarks.

Value Creation - Performance expectations are mutually guided including variable compensation/bonuses for meeting performance goals which aren't always savings focused but rather include: avoiding risk, achieving opportunities, and discovering innovations.

Real Time OrchestrationPerformance expectations are more real-time and detailed yielding more accurate predictions that result in the ability to capitalize more quickly to changing market conditions. Involves cross-functional decision making and orchestration across finance, supply chain, and product engineering teams.

7. With digital transformation approaching supply chain and procurement, is your sourcing professionals team and talent ready to take this on?

1 (low readiness, resistant to change)

2

3

4

5 (high readiness, rapidly adopting)

8. What tools and technologies are utilized to support strategic sourcing intelligence and negotiation outcomes:

Home-grown Excel tools

Excel-based templates & data warehouses

Business Intelligence system focused on spend analysis and cost management

Purpose built sourcing platform with integrated market intelligence services

Cognitive Sourcing platform (predictive insights, integrated market intelligence, AI recommendation engine)

9. How does your organization typically negotiate with suppliers? Please check all that apply.

Primarily price or cost-focused negotiations

Utilize internal KPIs to direct negotiations

Discuss KPIs and external benchmarks with suppliers

Cross-functional considerations are represented in negotiations

Artificial Intelligence provides negotiation recommendations

10. On average, how many calendar days does it take to conduct a strategic sourcing event from baseline collection to contract execution?

10 - 30 Days: Most events are "two bids and a buy"

30 - 60 Days: We keep events small and digestible and utilize tools to ease baseline collection and analysis

60+ Days: Tools and techniques allow us to consolidate into fewer, much larger events that take more time to collect bids and obtain internal approvals

11. On average, how much time is spent collecting and preparing baseline data for a sourcing event?

2 - 5 days: Our systems are all integrated with data cleansed and maintained on a continual basis

5 - 15 days: Our events are very small and suppliers help provide the data

15 - 30 days: Data is extracted from a Spend cube and/or purpose-built category management tools, so a majority of the time is fine-tuning and getting stakeholder approval.

30+ days: Need to pull data from multiple sources, requires manual manipulation, then push into a reporting tool to gain stakeholder approval.

12. On average, how much time is spent designing and building an RFx?

1 - 5 days: Our events are simple and we typically start from what was done previously.

5 - 14 days: We typically start from previous events / templates, but review for updates.

14+ days: We reference previous events / templates, but given the large scope of events we revisit and potentially redesign events.

13. What supply management data sources are managed in systems? Check all that apply.

Supplier insights and master data information is managed by individual commodity managers

Supplier insights and related spend information is stored centrally

Event / Transaction histories are stored centrally

Performance / Risk KPIs are monitored and shared centrally

Bill of Materials are maintained at raw material / commodity level

Recommendations and actions driven by AI

Submit

14. How important is it to have New Product Introduction (NPI) system that tracks risks and opportunities during development as well as connects to sustaining cost systems and processes?

1 (low importance)

2

3

4

5 (critical for sustaining value)

15. What technologies solutions does your organization use or plan to implement in the near future?

Digital/Personal Assistants

Contract Lifecycle Management

Sourcing Automation - RFx

16. About what % of your Direct Materials spend is captured in your Spend Analysis systems or tools?

We extract data from our ERP to analyze Spend

50-75%

75-95%

95%+

17. On average, how much time is spent evaluating bids and providing feedback to suppliers?

1 - 5 days: Our events are limited in scope so we can typically churn through analysis and feedback quickly, albeit manually.

3 - 5 days: Our sourcing tools provide nice reports and collaboration tools to analyze bids, then make feedback fairly easy to distribute.

5-10 days: Our sourcing tools help aggregate bid information, but we analyze in a separate BI tool then distribute feedback.

10+ days: We run large events and although our category-specific tools help aggregate bid data and analysis, it takes time to interpret the results then distribute internally to prepare feedback.

18. On average, how much time is spent preparing for and conducting negotiations?

1-3 days: Although we manually prepare for negotiations, the scope is limited so we're able to complete it quickly.

3-5 days: We extract the data from our sourcing tools to feed our BI tool and/or create our negotiation materials.

5-7 days: Our sourcing tools help identify negotiation opportunities.

7+ days: We run large events and although our category- specific tools identify negotiation opportunities, it takes time to align internally and prepare for large-scale negotiations.

19. Who typically leads preparation for the overall commodity/category strategy?

The Category/Commodity Manager

The Category/Commodity Manager + supporting business analysts

Cross-functional alignment with input from manufacturing partners, engineering, supply chain, and finance

Automated commodity/category strategy digital playbooks sourced from an AI/cognitive platform?

20. What kind of a superhero are you?

Option 1

Option 2

Option 3

Option 4

Option 5

21. What is the total annual direct materials spend for your organization?

< $500M

$500M - $1B

$1B - $2B

$2B - $5B

$5B+

22. Does your organization have a digital transformation initiative in procurement and/or direct materials sourcing? If so, how long has it been active?

Nothing formally launched and not active discussion/planning at this time.

Nothing formally launched, but initiatives are at the planning stage

Initiative launched, less than 1 year.

Initiative in place, 1 to 2 years in active status.

Initiative maturing, 2 to 3 years in deployment and adoption.

23. How important is "data-driven procurement" process for your sourcing professionals?

1 (low importance)

2

3

4

5 (critical to success)

24. On average, how much time is spent making award decisions and gaining internal approvals?

2 - 6 days: Although we manually analyze and award it goes fairly quickly because our events are limited in scope

6 - 10 days: Our final analysis is executed outside our sourcing system, then distributed to decision makers, and awards are made.

10 - 14 days: Our sourcing tools allow us to analyze and award quickly, so most of time is spent reviewing with stakeholders and gaining internal approvals.

14+ days: We run large events and although our category- specific tools help, it takes time to conduct final analysis to make award decisions, distribute those to stakeholders, and announce award decisions.

25. How often are your spend analysis and related sources of insights refreshed?

Annually (or less frequent)

Semi-annually

Quarterly

Monthly

Continuously

26. How are your sources of insights integrated with your sourcing and RFQ systems?

Manual

Semi-Automated

Fully Automated (little or no manual operations)

27. How do you use external sources of insight?

Track market indices for only our most strategic categories.

Track market indices for most or all relevant categories.

Market indices are analyzed by BI tools and supplemented by third party reports.

Market indices, analyst reports, and other sources are automatically fed into category-specific applications.

Category-specific applications are enabled by AI to provide and execute recommendations.

28. What organization structure best describes your sourcing team?

Decentralized or Siloed - Direct materials sourcing and commodity management teams are integrated into individual manufacturing sites, operating companies, or product units. Coverage of suppliers or commodity/categories may overlap across different organizational units.

Centralized - A model in which all procurement goes through a single, central organization. Focus is on leveraging corporate spend across the enterprise, standardizing sourcing and procurement processes and compliance. Often includes both indirect and direct procurement categories.

Center-led - Center-led organizations often form a procurement center of excellence (COE) that focuses on corporate supply chain strategies and strategic commodities, best practices, and knowledge sharing while leaving individual buys and tactical execution to the individual business units.

Cross-Functional - Extends on either centralized or center-led organizational models, with clear internal cross-functional process alignment with stakeholders and decision makers in peer groups, including supply management, product operations/engineering, finance, and manufacturing.

29. What Sources of Insight are typically utilized for negotiations? Please check all that apply.

Historic Data from enterprise systems (ERP, Business Intelligence, Spend Analytics)

Benchmark pricing for standard parts from distributors or third parties.

Contextual insights around supplier financial health, raw material input costs, foreign exchange, news sources.

Market intelligence on sub-commodities from third party research, analysts, published indices.Community insights sources from peer companies engaged with similar commodity groups or strategic suppliers.

AI-generated risks and opportunities