Monthly Archives: April 2007

The Talent Series XI: The War is Still Going Strong

Just in case you missed it, I wanted to point out the recent article declaring that there is no end in sight for the ‘war for talent’ over on the European Leaders Network site.

According to the article, the ‘war for talent’ in procurement is being fought as fiercely as ever on battlefields as diverse as Mumbai, Shanghai and Singapore and that a recent survey from McKinsey suggested the logistics industry is facing an annual demand for 75,000 employees, not a huge number until you consider at present, the industry graduates just 5,000. In other words, the demand is fifteen times as great as the supply!

The article concludes by noting that the next 12 months do, however, promise to offer further challenges to an industry function that has come a long way but still has further to travel and whether it’s changing the mindset of existing procurement staff, to ensure that strategic thinking becomes second nature, or attracting the new breed of employee necessary to drive forward change at an exciting time, the ‘war for talent’ shows no sign of abating.

What I’m wondering is why all these articles that acknowledge the war is worsening fail to mention that good eSourcing and eProcurement systems can help these companies by allowing their current staff to do significantly more with less while they search and fight for new talent. (And, more importantly, when are companies north of the border going to realize this fact? I’ve been back in Canada for three and a half years, but have spent the last two and a half working exclusively with companies south of the border.)

The Biofuel Blunder

Normally biofuel is the right choice. I discuss it in almost all of my green posts and Tim Minahan has also blogged a post or two extolling its virtues.

But there’s more than one type of biofuel. There’s the kind that powers your car – and there’s the kind that powers you! (After all, we’re biological organisms that need fuel too!) And you should never put your car ahead of yourself.

And more importantly, you should never put someone else’s car ahead of a German’s need to drink! I don’t know about you, but I wouldn’t want to be the reason Hans and Franz can’t have their suds after a long day at the gym! Might inspire a whole new meaning to pump you up.

But that’s just what farmers are doing in Germany. After an extremely poor barley harvest in 2006, many farmers are converting their fields to rapeseed, a common ingredient in biofuel. As a result, production is dropping and prices are going up in a country where the average daily consumption of beer is 111.6 litres per head, equivalent to every single man, woman, and child drinking a 0.31 litre glass everyday.

That’s a lot of beer … and a lot of angry Germans if prices spike and they can’t afford their beer anymore. I wouldn’t want to be standing across from that angry mob!

The Top Three VII: A Great Line-Up

As I indicated in a recent post, I have lined up a number of leading bloggers to bring you their top three. In anticipation of the great posts to come, here is a partial list of bloggers lined up for next week, in addition to the sourcing and procurement regulars (and possibly a few more guest bloggers):

I’m sure when we contrast their top three with the issues that sourcing bloggers like myself, Tim Minahan of Supply Excellence, David Bush of eSourcing Forum, and Jason Busch of Spend Matters regularly blog about, we’ll be able to paint a detailed picture of what Spend/Supply Management 2.0 really needs to address.

The Top Three VI: Straight to the Bottom Line

Today I’m thrilled to bring you a guest post from Doug Smock, editorial director of GlobalCPO.com and co-author of On-Demand Supply Management and Straight to the Bottom Line.

First I’d like to thank Michael for the invitation to participate in the blogathan. I’ve spent most of the last three years since I left Purchasing magazine writing two books about what I consider to be the biggest issues in the procurement world, and have already vented my spleen about such critical issues as CEO involvement/buy-in as well as world-class metrics (since 99.9% of all procurement departments I’ve visited have terrible metrics).

For this, I’d like to touch briefly on the need in American companies for greater cross-functional collaboration between procurement and engineering. The primary goals need to be reduction of specifications’ complexity, introduction of new ideas throughout the supply base, better understanding of “could” costs, improved management of products through their entire lifecycle, and dramatically improved product quality and user-friendliness.

When I first joined the staff of Purchasing magazine in 1977, we used to run a special issue called Value Engineering in which we ran reports of how teams of purchasing and engineering professionals met to reduce costs or improve performance of existing, or even brand new, products. I once visited Buell Motorcycles in East Troy, WI, and saw how product development began with a talk by founder Erik Buell on his vision for a new sports bike: the cost target, speed, look, and feel. Engineers and purchasing professionals then broke into platform teams and met with key supplier partners to develop components. One team replaced a 21-part front section of assembled metal pieces with a sleek-looking, stronger and cheaper single made through an outsourced metal molding process. When I returned to Purchasing as Chief Editor in 2000, I couldn’t really understand why the Value Engineering issue had disappeared. It also seemed to disappear at many companies in the blitz of wonders related to dotcomism.

That’s a shame because what suppliers bring to the table is incredibly powerful in this process. I saw it recently in the newly designed Cabrio and Duet line of laundry products from Whirlpool, where suppliers proposed solutions to technical problems that internal engineering teams felt were irresolvable. I hate to kick a dog when it’s down, but this to me is the most lamentable of all of the problems with the American automobile industry. Bob Lutz, currently chairman of GM North America and former head of Chrysler, once famously commented: “I was amazed (and a bit appalled) at the lack of functional integration at the companies I worked for.”

I know the blogs focus a lot on software, but I’d like to see a little more emphasis on blocking and tackling at the company level.

Editor’s note. Bold was introduced to help draw out Doug’s key ideas. Also, our blogs do occasionally tackle more than just software, and two posts in particular I’d like to point out are Jason Busch’s Selling the Value of Procurement to the Business and Tim Minahan’s Selling Supply Management to the C-Suite: Make it Personal. Also, keep your eyes on the eSourcing Wiki. More content is on its way, including a wiki on perfecting your pitch for a procurement project to pointmen.

The Top Three V: Learning to Communicate

As indicated in my last post, here is Kevin Brooks contribution to the Top Three. He takes a different spin, focussed on internal communication, but it is valuable insight nonetheless.

3 Ways To Get Buy-In

As a marketing guy, you’re required to be something of a corporate voyeur in
order to put your finger on the real pain facing your customers. In darkened
rooms, behind one-way glass partitions, I’ve watched focus group after focus
group of procurement executives complain about how they can’t get buy-in
from their organizations. “We communicate all the time, but it doesn’t seem
to make any difference!” I recall one harried CPO of a multi-billion dollar
company telling his nodding colleagues around the table.

While I’m sure every corporate function shares this perspective from time to
time, procurement teams seem uniquely saddled with difficulties making
themselves understood to their organizations. So, in the spirit of this
blogathon, I’d like to offer three rules that can help the struggling
procurement executive communicate more effectively.

Rule #1: Listen To Your Audience

You may think you’re simply putting out information, but your audience views
things differently. The best communications start with listening, and an
understanding that you’re always engaged in a dialogue – not a monologue —
with your audience.

There are formal and informal ways of listening to your audience. The
easiest is to simply talk with them. How do people like to receive
information? What format is best for them – email, snail mail, voicemail,
instant messaging, carrier pigeon? What makes them read or listen to
something now versus saving it for later? What kinds of messages do they
ignore completely? Why?

Do this regularly, and make adjustments to your approach based on what you
hear. Basically, just give your audience the same attention you’d give an
important supplier, and the simple fact that you took the time to ask them
their opinions will cause your next email or presentation to be “heard”
louder and clearer.

Rule #2: Repeat, Repeat, Repeat

It would seem logical to put out information that builds on what you’ve said
before. If last week you talked about the new travel spend policy, there’s
no need to rehash that old news when you want to let people know about the
new p-cards, right? Wrong.

It has been said that on average it takes people 6-9 times to receive
information before they “get” it. One email, or a single team presentation
won’t cut it. Repeat, repeat, repeat. Even when you’re sick to death of
telling people about the travel spend policy, grit your teeth and keep
mentioning it. It takes discipline, sure, but if you want to get a message
across, this is how you do it. There are no shortcuts.

Rule #3: Keep It Simple

This rule is tough, especially if your organization is filled with
detail-oriented gurus from the Pierre Mitchell school of PowerPoint. And, to
give them their due, complexity surrounds us in the business world and you
would think people could deal with a few extra bullet points or paragraphs
here and there.

Sorry, but they can’t. Your audience isn’t illiterate, but they are busy and
distracted professionals. If you can’t make your point efficiently, they
tune out. It is far better to get one message across clearly, than to get 10
messages across muddled.

Keep things simple by limiting your message to one idea per communication.
And remember: shorter is always better.

 

So there you have it. Three simple rules that can improve your
communications and help you gain buy-in for procurement across the
organization:

  1. Know Your Audience
  2. Repeat, Repeat, Repeat
  3. Less Is More

Good luck!

P.S. Jon Miller’s post on Lean Sourcing: The Top Three is up now as well!