The Procurement Success Stories series is a way for CoVest members to share positive experiences and promote collaboration among its members. Through the series we hope to learn about and share how our members have achieved success within their procurement organizations.
Our initial member interview is with Peter Coyne, Vice President at Steel Partners, whose responsibilities include overseeing Steel Partners supply chain. Steel Partners is a global diversified holding company that engages in multiple businesses and industries. Steel Partners works with its affiliates to increase profitability and shareholder value through operational excellence, process improvement, and strategic acquisitions.
Our interview began with a discussion about defining success. Coyne describes success as finding your passion and pursuing it in life, resulting in a positive impact on others. While the personal idea of success came easily to Coyne, he feels success withtin the supply chain is more complicated to define. For example, he says procurement success varies with the specific category, market place, and time horizon at hand. Success is influenced by supplier power and industry rivalry and cannot lose sight of quality, cost, service, innovation, and productivity. It is important to understand these varying dynamics before developing a sourcing strategy, as the goal shouold incorporate long-term success versus a short-term improvement in pricing or terms.
At Steel Partners, a holding company with 20+ operating units, different business cycles cause significant variation in the company’s sourcing needs. To make sourcing successful for the diversified company, Coyne seeks to understand and define individual business needs and identify common goals between those differing needs. From there, Steel works to identify key categories, define the scope, and develop a sourcing strategy, team, and category leader.
To reach long-term procurement success, it's fundamental to approach sourcing from a partnership standpoint. Coyne says his team brings a collaborative approach to procurement negotiations so the needs of all parties are known and considered. He feels that incorporating the needs of all parties and seeking to meet them amicably, results in more productive discussions, as both parties tend to be transparent and reasonable. He says the result is a strong supply partnership - a valuable asset when demand declines or supply is constrained.
One category that proved difficult to accommodate for Steel was freight. With significant spend, different IT systems, and varying service needs, it took significant time to develop and achieve their freight objectives. Despite the extended timeline, Steel Partners was satisfied with the outcome as they took the time necessary to understand what their needs were, balanced their categories, and relied upon their most important resource - their people.
As Supply Chain is the largest component of the value chain, Coyne seeks to find the optimal balance in bringing the team together in person, understanding ever-changing market dynamics, and sharing best practices. With 20+ operating companies in varying industries in over 35 countries, creating these disciplines can be challenging.
In committing themselves to add this rigorous process, however, Steel Partners benefits in multiple ways. The Steel employees have broadened their understanding of internal best practices across businesses and identified knowledge leaders within their broad organization. Steel companies have benefited organizationally by focusing within their businesses to better understand company processes, analyze results, and keep up with quarterly calls. Another major advancement has been refocusing their internal communication to help the company showcase their innovation and leadership. Steel has made it a best practice to seek outside counsel from supply partners and third-party advisors such as CoVest when situations or categories will benefit from such expertise.
To learn about Steel Partners head over to their website at, http://www.steelpartners.com. If you are interested in CoVest Sourcing Network visit us at, www.covest.com
If you want to contribute to our Procurement Success Story series, contact Richie Capeles at firstname.lastname@example.org and share your story today!