AOP PodcastCost Management

183: How to Stop the Leaks & Maximize Your Savings Potential w/ Tom Beaty

By May 7, 2018 January 4th, 2019 No Comments

Over the course of the last 15 years, Tom Beaty has grown Insight Sourcing Group (ISG) from a one-man operation to one of the leading procurement and sourcing consulting firms. Ranked by Inc Magazine among the fastest-growing private companies in America for the last 10 years, ISG is regularly recognized as one of the nation’s best boutique consulting firms to work for.

In today’s episode, recorded live at the SIG Spring Summit, I start by asking Tom what he is seeing in the field today in terms of the key challenges that CPO’s are facing, and some of the ways that they are working to solve those challenges.  We then focus on the topic of “what comes after sourcing”. We explore the startling statistic that only 60% of “addressed” spend is actually spent with the contracted supplier, and specifically, how can procurement professionals address and mitigate the risk of the savings leakage that occurs as a result.

“In indirect spend, it consistently is around 60% goes to the correct vendor. We’ve got different ways that we model that. And that data is pretty consistent with what other research firms have seen. You think about that and it’s like “That’s crazy!”… It’s so consistent across different companies regardless of the maturity level that you just have to begin to wonder what’s going on. – Tom Beaty

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Philip Ideson

About Philip Ideson

Philip founded Art of Procurement in 2015 as a way to empower procurement professionals at all levels to deliver change with confidence; whether from the inspiration of the popular weekly podcast that he hosts, or with targeted solution offerings that guide clients on their journey to transform the impact of procurement.