Insights

Mike McCaig, Chief Procurement Officer at ATI, shares his insights on recent procurement trends. He highlights the current challenges including supplier noncompliance due to inflation and operational issues. He notes overlooked opportunities in leveraging spend, recommends improved category management software capabilities, discusses internal debates on organizational models, and stresses the importance of proactive risk management due to ongoing global supply chain issues.

The writer compares the innovations in baseball analysis made famous by Moneyball, particularly the shift from batting average to on base and slugging percentages, to necessary changes in procurement and supply chain management post-pandemic. Rather than focusing solely on savings, companies should consider the broader value of supplier relationships and interactions, much like baseball teams now value other metrics, beyond hitting.

From the late 1990s to early 2020, sourcing became the primary tool for procurement professionals, driving savings and consolidating supplier bases. Its success was rooted in predictable pricing, available supply, and reliable delivery. However, the global COVID pandemic disrupted these conditions, making pricing unpredictable, supply scarce, and delivery chaotic. Consequently, procurement professionals experienced a shift in leverage from buyers to sellers and had to diversify their procurement toolkit to adjust to the new market realities.