EP 022 - What is Procurement with Reba Cox, Global Head of Procurement at MongoDB
04/02/24 • 89 min
In this conversation, Reba Cox delves into her extensive journey in the procurement field, transitioning from trading base metals to procuring them, and ultimately stepping into tech procurement. She begins by highlighting the fundamental skills and mindset essential for success in procurement, such as the importance of demand planning, establishing baseline prices for savings, and the critical role of building strong relationships with stakeholders.
Reba distinguishes between direct and indirect procurement, outlining the unique challenges and strategies each entails, particularly in managing software contracts. She emphasizes the necessity of understanding and planning for demand, alongside the crucial task of setting baseline prices to secure savings.
Further, Reba touches on the broader role of procurement within both manufacturing and tech industries, underscoring its strategic placement under operations in manufacturing firms and under the CFO in tech companies.
Additionally, Reba highlights the focus on security and scalability, especially in tech procurement, reflecting on the significance of these elements in today's industry. She also discusses the evolution of procurement tools and their value in facilitating the work of different teams, advocating for the integration of new technologies to streamline processes.
Moreover, Reba speaks to the personal side of her career, sharing insights on building a positive reputation, transitioning from a gatekeeper mindset to one that's more collaborative and aligned with business goals. She offers career advice and shares her ambitions, looking towards the future of procurement with an eye on innovation and efficiency.
Reba concludes by emphasizing the need for the procurement function to evolve alongside the industry, incorporating more advanced tools and strategies to address the complex challenges of today's business environment. This includes a strong focus on security, scalability, and aligning procurement strategy with the overarching goals of the organization, highlighting the transformative potential of procurement in both manufacturing and tech sectors.
Takeaways
Procurement involves managing contracts, spend, and vendor relationships for a company's non-salary expenses.
Building relationships with stakeholders and understanding their needs is crucial for procurement success.
Demand planning and setting baseline prices are important strategies for achieving savings in procurement.
In tech procurement, security and scalability are key considerations, while in manufacturing, savings and project-based initiatives take precedence.
Managing software contracts requires careful negotiation, demand planning, and consideration of non-financial elements such as SLAs and security measures.
Procurement is best placed under operations in manufacturing and under the CFO in tech companies.
The lack of comprehensive tools is a major challenge in procurement.
Automation and AI are key technologies that will transform procurement processes.
Supplier collaboration and relationship building are critical in manufacturing, while in tech, procurement is often brought in only when something goes wrong.
---
Quotes
“Procurement, by nature, is a function of functions.”
“Procurement is sales without the quota.”
“The more you absorb, especially when you're younger in your career, the more you'll be able to understand and piece things together.”
“The best thing to do when you come in is just absorb, ask questions, learn about other functions because your job as procurement is to make sure that everybody else's functions are basically happening and being protected.”
“Zero dollar touch means that we don't have a high threshold for spend at the company that doesn't go through procurement.”
“If you're an inquisitive person, it's a great place to be because you kind of know everything about everything that's going on.”
“Procurement handles contracting and spend and vendor sort of management at the strategic level for all the dollars that the company spends that's not on salary.”
“So I think that's one, I think, unique thing for procurement leaders. You really have to be a good relationship builder internally and externally.”
“I try never to have a new vendor with more than a one-year deal.”
“The first deal you do set your baseline for all renewals. And I think that a lot of people, especially in a software deal, don't understand that.”
“Procurement and sales actually have the same goal. We wanna close the deal as fast as possible.”
“The worst case scenario for a software deal is that your sales rep has forecasted a number that's just well bey...
In this conversation, Reba Cox delves into her extensive journey in the procurement field, transitioning from trading base metals to procuring them, and ultimately stepping into tech procurement. She begins by highlighting the fundamental skills and mindset essential for success in procurement, such as the importance of demand planning, establishing baseline prices for savings, and the critical role of building strong relationships with stakeholders.
Reba distinguishes between direct and indirect procurement, outlining the unique challenges and strategies each entails, particularly in managing software contracts. She emphasizes the necessity of understanding and planning for demand, alongside the crucial task of setting baseline prices to secure savings.
Further, Reba touches on the broader role of procurement within both manufacturing and tech industries, underscoring its strategic placement under operations in manufacturing firms and under the CFO in tech companies.
Additionally, Reba highlights the focus on security and scalability, especially in tech procurement, reflecting on the significance of these elements in today's industry. She also discusses the evolution of procurement tools and their value in facilitating the work of different teams, advocating for the integration of new technologies to streamline processes.
Moreover, Reba speaks to the personal side of her career, sharing insights on building a positive reputation, transitioning from a gatekeeper mindset to one that's more collaborative and aligned with business goals. She offers career advice and shares her ambitions, looking towards the future of procurement with an eye on innovation and efficiency.
Reba concludes by emphasizing the need for the procurement function to evolve alongside the industry, incorporating more advanced tools and strategies to address the complex challenges of today's business environment. This includes a strong focus on security, scalability, and aligning procurement strategy with the overarching goals of the organization, highlighting the transformative potential of procurement in both manufacturing and tech sectors.
Takeaways
Procurement involves managing contracts, spend, and vendor relationships for a company's non-salary expenses.
Building relationships with stakeholders and understanding their needs is crucial for procurement success.
Demand planning and setting baseline prices are important strategies for achieving savings in procurement.
In tech procurement, security and scalability are key considerations, while in manufacturing, savings and project-based initiatives take precedence.
Managing software contracts requires careful negotiation, demand planning, and consideration of non-financial elements such as SLAs and security measures.
Procurement is best placed under operations in manufacturing and under the CFO in tech companies.
The lack of comprehensive tools is a major challenge in procurement.
Automation and AI are key technologies that will transform procurement processes.
Supplier collaboration and relationship building are critical in manufacturing, while in tech, procurement is often brought in only when something goes wrong.
---
Quotes
“Procurement, by nature, is a function of functions.”
“Procurement is sales without the quota.”
“The more you absorb, especially when you're younger in your career, the more you'll be able to understand and piece things together.”
“The best thing to do when you come in is just absorb, ask questions, learn about other functions because your job as procurement is to make sure that everybody else's functions are basically happening and being protected.”
“Zero dollar touch means that we don't have a high threshold for spend at the company that doesn't go through procurement.”
“If you're an inquisitive person, it's a great place to be because you kind of know everything about everything that's going on.”
“Procurement handles contracting and spend and vendor sort of management at the strategic level for all the dollars that the company spends that's not on salary.”
“So I think that's one, I think, unique thing for procurement leaders. You really have to be a good relationship builder internally and externally.”
“I try never to have a new vendor with more than a one-year deal.”
“The first deal you do set your baseline for all renewals. And I think that a lot of people, especially in a software deal, don't understand that.”
“Procurement and sales actually have the same goal. We wanna close the deal as fast as possible.”
“The worst case scenario for a software deal is that your sales rep has forecasted a number that's just well bey...
Previous Episode
EP 021 - Masterclass on Strategy with Alex Small, Head of Strategy & Operations, Central at Stripe
In this conversation, Alex Small shares his background and journey in the finance and tech industry. He discusses his professional role from being a systems administrator to Head of Strategy and the importance of systems thinking in finance. Alex also talks about his experience at Zendesk and ClickUp, highlighting their positioning in the market. He explores the trade-off between profitability and growth in SaaS businesses and the key metrics to track in the industry. This part of the conversation covers key metrics for understanding business performance, and the comparison between SaaS and Payment's transaction-based business models. Further, in the Masterclass on Strategy, Alex discusses the role of strategy in business, differentiating good strategy from bad strategy, the challenges and considerations of strategy, the influence of data and technology on strategy, building a strategy team, the importance of internal mobility, and managing multiple roles and businesses. Additionally, Alex discusses the importance of professional relationships, the need to eliminate distractions and focus on tasks, his definition of success, his approach to leadership, and his perspective on career regrets.
Takeaways
Systems thinking is crucial in finance to understand the interconnections between different aspects of a business.
Promotions and success in a career often require a combination of hard work, competitive advantage, and strong relationships with business partners.
Positioning in the market is essential for companies to differentiate themselves and find their niche.
SaaS businesses face the challenge of balancing profitability and growth, with many prioritizing growth to stay competitive.
CAC payback is a critical metric in SaaS, indicating how long it takes to recoup the cost of acquiring a customer. Key metrics for understanding business performance include customer lifetime value, CAC payback, and the ratio of customer lifetime value to CAC payback.
SaaS and transaction-based business models have their own advantages and challenges, with SaaS offering strong margins and transaction-based models having a larger total addressable market (TAM).
Strategy should connect operations or finance to strategy, and it is important for all teams to be strategic, not just those with 'strategy' in their title.
Good strategy is comprehensive, actionable, and communicable, and it should accomplish something for the business.
Data and technology play a crucial role in shaping strategy by providing competitive research and enabling benchmarking and analysis.
When building a strategy team, consider internal mobility and the need for diverse perspectives and deep strategic experience.
Internal mobility helps increase tenure and allows for iterative learning and growth within the company.
Capabilities for a strategy team include a deep understanding of the business, the ability to connect different areas of strategy, and the skills to leverage data and technology effectively.
Managing multiple roles and businesses requires prioritization, passion, and the ability to focus and work efficiently.
Building great relationships is crucial for success in business and can lead to valuable partnerships and opportunities.
Eliminating distractions and maintaining focus is key to productivity and achieving goals.
Effective leadership involves building strong relationships based on trust, respect, and accountability.
Chapters
Introduction and Background
Journey and Key Milestones
Role as a Systems Administrator
Promotions and Success Factors
Positioning of Zendesk
Positioning of ClickUp
Profitability vs Growth
SaaS Metrics
Key Metrics for Understanding Business Performance
Comparing SaaS and Transaction-based Business Models
The Role of Strategy in Business
The Challenges and Considerations of Strategy
Differentiating Good Strategy from Bad Strategy
The Role of Strategy Leaders
The Influence of Data and Technology on Strategy
Building a Strategy Team: Internal vs. External Hires
The Importance of Internal Mobility
Capabilities and Considerations for Building a Strategy Team
Managing Multiple Roles and Businesses
The Power of Professional Relationships
Starve Your Distractions and Feed Your Focus
Defining Success and Future Goals
Approach to Leadership
No Regrets in Career
Lightning Round
---
Quotes
“Strategy, operations, and finance need to come together to make a business successful.”
“If you work twice as hard, you get promoted twice as fast.”
“The only reason a SaaS business would have a lack of profitability is because they're v...
Next Episode
EP 023 - Data, Insights, Funding Winter, Compensation & Marketing with Peter Walker, Head of Insights at Carta
In this episode, Peter Walker, Head of Insights at Carta, discusses his journey in the startup world and the role of data in his career. He shares insights on the challenges and trends in implementing analytics at scale. He also provides an overview of the funding landscape and the impact of the pandemic on fundraising. The conversation explores the impact of changing interest rates on startup funding and the challenges faced by startups in the current market. It discusses the decline in seed funding compared to series D funding, the need for capital in late-stage rounds, and the shift in fundraising dynamics. The conversation also touches on the liquidity of equity for startup employees, the decrease in startup hiring, and the changes in startup compensation. The guest shares insights on leadership, success, and advice for emerging professionals.
Takeaways
Startups can leverage data to make informed decisions and improve their operations.
Data storytelling is a powerful tool for communicating insights and making data more accessible.
The implementation of analytics at scale requires data cleaning, understanding the audience, and integrating different databases.
The funding landscape for startups has been challenging, with a decline in fundraising in recent years.
The impact of the pandemic has varied across different stages of a company's life cycle.
Changing interest rates have had a significant impact on startup funding, with seed funding down compared to series D funding.
Late-stage rounds require massive amounts of capital, and the decline in late-stage funding raises concerns about where the money will go.
Startup employees are facing challenges in accessing liquidity for their equity, leading to a decrease in exercise rates.
The startup job market has seen a decrease in hiring and an increase in shutdowns.
Startup compensation has undergone significant changes, with equity compensation decreasing and salary compensation remaining relatively flat.
Leadership can be demonstrated at any level within a company, and energy and consistency are important qualities for leaders.
Startups should consider starting fundraising earlier than expected and focus on making every dollar last longer.
The guest's goal is to make Carta data ubiquitous and be the single source of truth for startup data.
---
Quotes
“Energy is contagious.”
“The funding winter is thawing, but is still rather chilly.”
“Things are a lot harder than they appear on the surface.”
“A lot of marketers do themselves a disservice by not understanding data as much as they should.”
“The cap table is a record of who owns what percentage of a company.”
“A lot of B2B companies can actually use this as a new form of marketing. It's data content that educates your audience about the world and the market that they're in.”
“Insight is a piece of information that's going to help you make a decision.”
“Always on I think is it sounds good real time, but it isn't always necessary.”
“Industry, time, location, these are all very clear and obvious filters to put into your data that kind of expose and kind of tease out differences between parts of your data set.”
“I come in usually with a question. But oftentimes, the data leads me to things I wasn't really thinking about.”
“The closer you are to IPO, the more difficult the fundraising market has been... Seed funding on Carta is down something like 30 to 35% from peak, whereas series D funding is down something like 80% from peak.”
“There's maybe more liquidity needs to happen at earlier points in the company journey if companies aren't gonna go public for a decade plus.”
“The employee that's hired in January of 2024 receives about 36% less equity than the employee that was hired in November of 2022.”
“It is an employer friendly hiring market at the moment.”
“I think we will see more shutdowns through H124 than we've seen in a long time.”
“Leadership in your role doesn't have to come along with a title. So you can have influence without having authority.”
"As soon as you prove yourself competent, you get to do so many things that are not in the job description."
---
Where to find Peter Walker:
LinkedIn: https://www.linkedin.com/in/peterjameswalker/
Twitter: https://twitter.com/PeterJ_Walker
---
Where to find Carta:
LinkedIn: https://www.linkedin.com/company/carta--/
Twitter: https://twitter.com/Cartainc
Website: https://carta.com/
---
Where to find Rohit:
...If you like this episode you’ll love
Becoming Your Best | The Principles of Highly Successful Leaders
Cold Call
Promote Yourself to CEO | Small Business Strategy for Women Entrepreneurs
Guy Kawasaki's Remarkable People
Building your LeaderBrand - Personal Branding, Social Media Marketing, Sales, Leadership & Expert Business for the Modern Entrepreneur
Episode Comments
Generate a badge
Get a badge for your website that links back to this episode
<a href="https://goodpods.com/podcasts/strategy-of-finance-252580/ep-022-what-is-procurement-with-reba-cox-global-head-of-procurement-at-47989417"> <img src="https://storage.googleapis.com/goodpods-images-bucket/badges/generic-badge-1.svg" alt="listen to ep 022 - what is procurement with reba cox, global head of procurement at mongodb on goodpods" style="width: 225px" /> </a>
Copy