Philosophical Friday: Spendstorming

October 12, 2012 | Leave a Comment By Michael Matherly

spend-stormingSpendstorming, for those of you not familiar with the term, is a procurement reference to identifying quick and easy strategies for obtaining spend data visibility. In order to increase your spend under management potential, you should focus first only on quantity of spend captured. Quality of spend management will come later.

OK, enough with the spoof: spendstorming is not a real term or even word (according to spell check). But I think the idea of spendstorming has potential. First the backstory…

Labor Day Reading
This past Labor Day I was reading the book Imagine, How Creativity Works, by Jonah Lehrer. Literally, it is a deep dive into how the brain functions, how people think to produce creative ideas. This book had the potential to be a real snoozfest, but instead it was extremely interesting and captivating due to the familiarity of the case study examples. From the origins of Proctor & Gamble’s Swiffer product, to Bob Dylan’s creative imagination that lead to “Like a Rolling Stone”, to Pixar’s lesson about the importance of “plussing” during the making of Toy Story 2 – the book is full of real world examples we are all familiar with, but probably don’t know much, if anything, about the backstory.

The Origin of Spendstorming
In the chapter entitled The Power of Q (you’ll have to read it yourself to understand the essence of Q), Lehrer tells the 1940s story of how “Alex Osborn, a founding partner at advertising firm BBDO, came up with a catchy term for what he considered the ideal form of group creativity: brainstorming.” In Osborn’s book Your Creative Power a key principle of brainstorming is to generate creative ideas in a safe environment, avoiding negative criticism and ridicule allowing for imaginative potential by focusing on quantity [of ideas] first, and quality second.

Finding a way to gain visibility to SOW services spend data at the very early stages of the category maturity lifecycle is arguably the same thing as brainstorming – just with spend data visibility as the objective instead of ideas for [fill in the blank with generic business problem].

In order to solve a problem, what do people typically do first?…Brainstorm. What do procurement professionals do first when initiating management of new spend types?…Spendstorm (or at least I think they should!).

Consider it this way: The real challenge at the very formative stages of bringing any spend under management is to first figure out how to capture the spend, how to gain that ever critical spend data visibility. How that spend is to be managed is of relative little importance when you can’t even see the spend well enough to segment it into spend types or by vendors. How many times have we heard: “if we could just see the *!@&! spend data we could manage it better!”

Spendstorming, therefore, is taking that first critical step of gaining visibility into unsegmented spend and knowing that future visibility will bring clarity to how that spend is to be best managed.

Spendstorming is not a real term, but the procurement principle it relates to is very real.

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