While making fun of the way governments purchase has long been a good source of humor in spend management circles, the deficit news coming out now leads one to believe that it is now time to really make something happen.

What do you think? How would you make this happen? Is it a lost cause?

Ariba has jumped into the fray several times and has even set up, with the help of some public sector experts, a toolkit for public sector professionals to get started.

The value that has been realized by the private sector from the institution of advanced sourcing, contracting, procurement and payment techniques has been staggering. Many in the private sector look at this and think “if only we could do this for the government and, even more, the taxpayer”. Despite the very real challenges, the potential value from broad implementation of Spend Management in the public sector is enormous. Cost savings is just one of the benefits:

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Toyota consistently ranks among the most respected global corporations and is well-known for their manufacturing prowess and strong supplier ties. That’s exactly why this week’s news about the accelerator problems for 4 million vehicles came as a shock to so many of us. The impact of this episode will be long-term, far-reaching, and very expensive.

Supply risk specialists speak often about the three distinct kinds of supply risk (Brand, Commodity, and Disruption). While this episode at Toyota may not have hit a trifecta, they are certainly dealing with an awful daily double. The only thing that might be more expensive than the disruptions in their supply chain could be the hit to their brand.

If you think that only your biggest suppliers need to be involved in a formal supply risk management program (e.g. automated alerts and scorecards populated by both objective and subjective data inputs from various sources as one component) and the rest can be covered with just some historical financial information/ratios, on-time delivery ratios, and maybe an annual business review, think about the fact that CTS is almost certainly not even in the top 500 of Toyota’s list of largest suppliers.

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Regardless of who might have authorship rights (Pimco? Ariba? Others?), the concept of “The New Normal” has definitely caught on in both the mainstream media and spend management circles .

However, it’s important to remember that “the New Normal” doesn’t translate directly to “permanent low GDP growth” as has been put forth by some investment advisors.

Instead, the New Normal is characterized by several trends that will, over time, become “SOP” for most large organizations:

1. Increased need for agility to respond more quickly to rapid change whether that’s in commodity markets, geopolitical supply risk, regulatory environments, or good old-fashioned competition.

2. Fewer permanent resources and increased reliance

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A lot of Supply Excellence readers are members of the Strategic Sourcing & Procurement Group on LinkedIn and may have seen the lively discussion in December on how the Group can become a more valuable resource in 2010. Out of that discussion, the idea to have regular conference calls to tap into the Group’s collective brainpower was born.

I’m thrilled to announce that the first call is this Friday featuring the Hackett Group’s Chris Sawchuck. Chris will cover Hackett’s research on the “key issues” companies will face in 2010 and then open the floor for an interactive discussion.

The only catch…the call is for Group members only. So you must be a member of the Strategic Sourcing & Procurement group on LinkedIn to get the dial in number (you can request to join here). The details - including international dial in numbers and time - here.

Justin Fogarty is Managing Editor of Supply Excellence. For any questions or feedback on the blog or its contributors, Justin can be reached at jfogarty[at]ariba.com.

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The turbulent times in the trucking industry continued through the remainder of 2009, with additional carriers going out of business and the YRC restructuring plans continuing to unfold. It seems that we are no longer surprised to hear of trucking companies going out of business after seeing 3000 trucking companies closing their doors in 2008 and the final tally for 2009 yet to be told. Stories such as flatbed carrier Arrow Trucking of Oklahoma suddenly closed its doors on December 22nd, suspending all operations and laying off all 1,600 employees are adding to the final count of 2009. The company was ranked No. 99 on the Transport Topics 100 list of the largest U.S. and Canadian for-hire carriers. While a formal statement has not been issued by the company yet, the CEO did release a brief statement that indicated the company was negotiating with its principal lender.

One carrier that the industry continues to monitor and question its ability to survive is YRC. In another step to realign its business model, YRC Worldwide sold the dedicated contract carriage division of YRC Logistics to Greatwide Logistics Services for $34 million. YRC Logistics’ dedicated contract carriage business accounts for approximately 15 percent of YRC Logistics’ revenue, and about one percent of YRC’s total revenue. YRC also completed its debt-for-equity exchange offer in an ongoing attempt to reach

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