Knowledge ManagementProcess Implementation

Checklist: Is Your Commercial Organisation Ready In Doubling The Digits Of Your Operating Profits?

The credit crisis of 2008 had a significant impact on all organisations. What has happened post crisis to your organisation in the decade that has followed?

If nothing has changed dramatically in your commercial organisation in the last decade, your company may still be in crisis mode. A simple question to ask yourself: Have operating profits returned to pre-crisis levels? Reading this blog might be a game changing inspirational event…

Business fundamentals have been significantly changed over the last decade;

  • Prices of commodities have reduced significantly
  • The landscape of customers and suppliers has been changed dramatically in 10 to 60 years, and the expectation is that 40% won’t exist anymore in 10 years
  • New ways of working have been implemented and now are now matured which has impacted the current cost levels with more to come in the next decade

The competitive landscape changes have seen a different set of winners and losers with the winners coming from organisations that have innovation as a continuous part of their business cycle and not a benchmark date in history.

Many winners took the opportunity to innovate their business models and invest in better business processes. Subsequently, higher operating profits are being realised. In the commercial excellence space, innovation has been in people skills, processes and tools.

The independent IACCM research shows that there is a significant commercial value to extract in sales and procurement contracts: a value leakage 9.2% on average across industries.

Doing the simple math here, innovating your commercial practices will turn your one digit Operating Profit into two digits one!

So what have been changed in the last decade for these winners, the game has been changed in Sales and Procurement capabilities;

  1. People skills– Smarter and virtual commercial organisations enabled with bi-lingual skills in Commercial, Finance, Legal and IT competences.
  2. Processes– A value-centred Commercial & Contract Management approach, moving the traditional commercial transactions towards commercial value based and relational arrangements of companies.
  3. Tools– Smoother and Intelligent commercial transactions processing has been moved from ERP to Best Breed Systems to manage better the pre- and post-award Commercial & Contract processes.

Interested to get more about this? Read our upcoming Blogs.

If impatience or interested to know, what this means for your company? Give us a call to provide you support in this game-changing journey and stay in sync.