Services Procurement Panel

In services procurement, much of it is about building and growing relationships. Three supply management executives representing CarMax, The Walt Disney Company and Humana Inc. provided personal stories and best practices in services procurement.

Dodie Fix, assistant vice president for CarMax, shared the challenges of managing facilities services when CarMax separated from its parent company Circuit City in 2003. Several categories including waste management, janitorial services, landscaping and snow removal, and construction materials and services involved examining current suppliers for its 110 superstores and negotiating national contracts with suppliers that met CarMax’s business needs and potential savings. The initiative led to savings of 2% to 20% in facilities services category savings.

Steve Miller, senior vice president, strategic sourcing and procurement and facility services and support for The Walt Disney Company, discussed the use of 360-degree review process with contract and marketing services partners. Miller focused on three key areas of marketing spend at Disney: marketing research (10%), creative (25%) and media (65%). With the top five agencies in each relevant category of spend participating in the review process, it was an opportunity to ensure Disney was using the right agency in those spend areas and capitalizing on the company’s value-added opportunities.

Deborah Beavin, C.P.M., CPO for Humana Inc., detailed the company’s contingent labor initiative to compress rates and markups as well as create a solution for its VMS/MSP suppliers. Inside Supply Management is featuring a full article on Humana’s contingent labor initiative in the May digital edition of the magazine.

There was an overall theme among the three panelists’ initiatives of relationship building and cost management. What are some of the lessons learned in services procurement within your own organizations?

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