Monthly Archives: January 2009

Supply Chain Application Sustainability

Business applications that are not continuously maintained and updated go stale … and this is doubly true for supply management applications. After all, as a recent i2 article on synchronizing supply chain applications with continuous change notes, the value of an efficient supply chain and its use as a competitive lever can only come when it is in continuous alignment with changing business conditions and market trends.

These days, more and more companies are selecting out-of-the-box solutions since they provide access to best practices and the latest technological innovations. In particular, many companies are selecting modern, SaaS-based, applications that provide them with the flexibility they need to customize the user interface, workflow, data modeling, and other components they need to align more closely with business needs. But, these applications, however, can only deliver high value continuously if they are flexible and easily maintainable to achieve high-level responsiveness.

Specifically, such a system needs to be able to:

  • integrate existing legacy systems until their functions are replaced
  • allow rapid prototyping of business ideas through what-if modeling
  • enable procurement users to define and adjust process flows without IT intervention
  • link multiple disparate applications in a business process flow
  • provide for data synchronization and harmonization across existing systems

And this will require constant maintenance and regular updates because business continually face the following challenges:

  • operational
    all businesses experience turnover and all business need to retain operational knowledge despite the turnover
  • evolutionary
    dynamic business conditions spawned by continuously changing demand requirements, competitive pressures and supply arrangements require applications that evolve in parallel
  • organizational
    business needs change as market dynamics change
  • infrastructural
    new hardware and middleware is continually introduced to the environment as the business tries to capture the new innovations they bring to the table

So how do you make your applications sustainable? Start by:

  • Following a Standard Maintenance Program

    Out-of-the-box applications — be they traditional behind-the-firewall or modern SaaS — come with standard maintenance, and update, programs. Be sure to use them to their full advantage as they will help you overcome many of the operational and infrastructure challenges you’ll face on a regular basis.
  • Regularly Reviewing and Tuning Your Solutions

    Applications will inevitably get out of synch with business requirements as small changes accrue over time. Applications should regularly be reviewed by subject matter experts who can identify misalignments, gaps, or missing opportunities and the best way to address them. Often, simple tune-ups result in 20% improvements in key metrics.
  • Synchronizing with Business Changes

    If you select a well-designed application platform with a loosely-coupled architecture, it will be possible to make adjustments economically to keep the platform tightly aligned with business changes.
  • Conducting a Strategic Impact Analysis

    With every deployment, key metrics and targets for improvement need to be identified and tracked against a well-defined baseline. This allows the organization to monitor the health of the application and determine when it needs to be tuned and when it needs to be replaced to keep the procurement operating at peak productivity … which it needs to do to achieve peak savings.

Tips on Bashing Your Favorite Blogger

For those who have been paying attention, I was going to post a good-hearted humor rant today on “what to do if you’re a blogger who’s out of content”, but after Somebody‘s mean spirited verbal bashing of a fellow blogger, I felt I had to hold off out of respect, especially since I used that blog as part (but nowhere near all) of my inspiration for the post. So instead, for those of you who feel that they must spend their time bashing bloggers instead of contributing useful information to the discussion, I give you a rather dry post on how to do it right. (And for those of you who feel I have attacked you personally, feel free to use them if it will make you feel better, as this will help you think straight and realize that, chances are, it wasn’t about you.)

Let’s face it, every now and again your favorite blogger, who is only human, will say or do something that you think is completely idiotic. And sometimes it will rattle your cage to the point where you’ll forget about your shy lurker ways and feel the need to post something scathing in reply to knock that smarty-pants off the high horse (s)he’s riding. And it’s okay to feel that way, especially if the blogger posted something that is quite silly when the blogger should have known better, but it’s not okay to go psycho and anonymously deliver a raging verbal smack-down dripping with acid. Not only is it likely to have the opposite effect of what you intended (as the blogger might simply get angry and bust you down so hard that your sagging ego will still be reeling this time next week), but you’ll like a complete idiot to the majority of his (or her) readers who will be saddened or angered at what will have been a completely unprovoked, and if you misinterpreted the blogger’s message, an unwarranted attack on your part. Unless, of course, you do it right. So here are three tips to help you get it right if you truly have nothing better to do than bash (your fellow) bloggers.

1. Keep it light-hearted and keep the humor genuine.*

Every blogger needs a good bashing once in a while, especially if the blogger is perceived to be a thought leader by those in the mainstream media that are supposed to be in-the-know and the blogger is overly prolific. It’s no secret that I like to bash a few of my fellow bloggers from time to time (and take a few lumps myself, though not always where I expect them), and will not hesitate to jump into the fray when a blogger posts something that I believe the blogger clearly should have put more thought or effort into; but each and every time I do my utmost to keep my public comments from getting too personal and too nasty, unless I believe it to be reasonably clear that the comments are in pure jest (as nothing livens up the blogsphere like a good natured smack-down). Let’s face it, without your bloggers, all you’d have is the traditional trade publications and the analyst firms, and that would be a very sorry state of affairs when you consider how stale some of the publications have become and how a number of reputable analysts have made it public knowledge that they are forced to be quite reserved about what they do and don’t say about their firm’s customers in their public writings. Remember, without us to keep the pressure on, they could feed you the same-old, same-old year after year and keep calling it “new-and-improved” when it’s “yesteryear’s news”.

* The only exception is when you decide to engage in a debate against yourself. Then sometimes it’s funny to take it over the top.

2. Make a valid argument.

Comments along the lines of wake up and smell the coffee you arrogant sloth, EIPP has been old news since 2003, while potentially true, are not very helpful and only serve to demonstrate your ignorance as you have not offered a single fact to back it up. If you had instead said “I’m sorry, but I don’t see the relevance or importance of yet another new EIPP solution from vendor X because vendor Y has been offering exactly the same solution for three years, details at this web address“, you would have made a valid discussion point and engendered a lot less animosity along the way.

3. But most of all, keep it civil.

Sometimes a blogger will get it dead wrong, sometimes a blogger will climb too high a horse, and sometimes the blogger will do both in the same post. Although the latter is quite rare for a professional blogger, bloggers are only human and it can happen, especially if the blogger believes he is right. But if he’s not, chances are he wants to know it because professional bloggers care more about getting the message right than looking stupid on occasion, as long as you’re civil in pointing out his mistake. Remember, bloggers are only human and a personal attack is likely not going to accomplish anything besides enraging the blogger who will have difficulty seeing past your incompetence in communication and his gut-instinct to take you down a peg or two. But if you’re calm, clear, rational, and polite … chances are he’ll not only concede every point, but thank you for it.

As long as your blogger makes an honest effort on a regular basis, he or she deserves a little slack from time to time. And if he starts abusing that privilege, and you feel that you must call him out, then feel free to do so, but be civil and constructive — because if you’re not, you’re not helping anyone. Finally, all the good bloggers publish their e-mail addresses on their blog and we’re all open to constructive criticism. So if you can’t be subtle, you can always consider going direct to the source with your comments.

Dead Company III: Fear is the Enemy

After I penned CIRCUIT, Dumb Company, and Dead Company, but before I penned Dead Company II, Brian Soils authored a great post over on TechCrunch on how Fear Kills Busineses, Dead. Noting that recessions naturally inject fear and panic, Brian also noted that fear is not a catalyst for productivity. Fear, and the dissemination of distress, slowly erodes hope, vision, and ambition, ultimately killing businesses instead of guiding them.

For example, just look at the deeply misguided advice that Sequoia Capital has issued in fear: don’t worry about getting ahead, instead, just survive … cutting deeper and quicker is the formula to survive. As I explained in Part II, it’s actually the formula for a slow and painful death! You’d be better off doing a Boo.com and wasting it all on lavish parties … at least you’d have some fun before you joined your brethren in the unemployment line.

As per Brian’s post, you need to instead take the advice of CEO Steve Larsen of Krugle who advises don’t be stupid. Have enough cash to run your business, but … look for opportunities. Difficult times are when they’ll most likely occur. When we’re at a ‘steady state’ and things are normal, good opportunities are much harder to find with GREAT opportunities nearly impossible. It is during periods of tumult and transition when you can spot things that lead to the greatest returns — if you are alert.

More importantly, as I pointed out yesterday in Part II, if you choose to stop vying for customer attention, the world will move without you. In other words, you’d be better off putting up a “going out of business sale” sign than cutting your marketing budget … at least the former will garner you some attention. As Brian notes, the recession is temporary, but business is constant, and, more importantly, if you’re in spend management, this is the time when your business can pick up sharply. In other words, if you haven’t increased your marketing budget lately, this is the year to do it. As long as you develop an innovative and cost-effective marketing strategy, you’re sure to get a return on your investment … and if you play your cards right, you might see a return beyond your wildest imagination. After all, as Brian notes, customers are and will continue to research, invest, and procure the solutions, services, and products that will help them succeed, offer entertainment, or streamline aspects of their day-to-day workflow.

Focusing energies on generating revenue, increasing visibility, and enhancing customer loyalty are the most effective strategies for underwriting longevity, and [hopefully] growth, especially during an economic downturn. Remember, customers do not typically go out of their way to “discover” your products. If they don’t see you in the places, like Sourcing Innovation, that they typically go for information, they’re not likely to see you at all. Smart marketing is your conduit to connecting prospects to your business.

Tomorrow’s Leaders Are Born Today.

So what are some things you can do to keep you off of the dead company path? Stay tuned for part IV!

Dead Company II: If You’re Hoarding Cash …

Like my fellow bloggers, I talk to a lot of companies in the run of a week, and many more in the run of a month, and one thing I’ve been hearing too much of lately is “we’ve cut back on X” — where X is marketing, development, or outside consulting — “because we have to conserve cash to get through the current crisis” — where the crisis is the current recession, downturn, etc. And it saddens me because the truth of the situation is thus: If You’re Hoarding Cash, You’re Not Going To Last … you’re just prolonging a slow, agonizing death!

As I’ve reminded you many times before, great companies are born in recessions … especially in Spend Management! This is a spend management company’s best time to shine … and the time you are most likely to get the undivided attention of senior management who dismissed you as unnecessary when times were good and the stream of cash was overflowing. Plus, it’s an opportunistic perfect storm like none you’ve ever seen: companies are desperate for savings, prices have nose-dived in many commodity markets which had been climbing steadily for years, and many types of spend management technology — including sourcing, procurement, analysis, optimization, supplier information management, and trade management — are now mature low-risk technologies in the eyes of even the most conservative techno-phobes. Plus, SaaS has hit mainstream and advances in cloud infrastructures allow you to keep your costs, and prices, low enough to make your solutions, and the returns they offer, within the budgets of even the lower end of the mid-market. In other words, everyone needs it, everyone can benefit from it, and everyone can afford it — especially if you can offer SaaS and they don’t have to come up with a large amount of cash up front, before they see savings.

But you’re not going to see a single sale if:

  • they don’t know you’re there
    and they won’t if you don’t keep your brand out there where they can find it
  • you’re not keeping your technology up-to-date
    because even the most technology illiterate procurement professionals know that advantages are fleeting and the only real value will come from solutions that are continually being improved and updated
  • you’re not innovating ahead of your competitors
    because it is always a buyer’s market and customers are going to buy the best solution … and you’re not going to know what that is if you don’t bring in some expert help once in a while to help you do a competitive analysis and chart the right roadmap

Now, I’m not saying that you should go out and spend 50K to 100K on a trade-show and staff your booth with magicians, super models, and sports stars just to get attention; that you should double your development team and see how much you can pump out in the next year; or that you should go out and hire a McKinsey or A.T. Kearney to do a complete end-to-end analysis of your software and service offerings — just that you need to conduct business as usual against a thought-out growth strategy. Otherwise, you might as well pack it in and go home, because odds are that you have no future.

However, I am saying that you need to maintain visibility where it counts, and especially on-line as some recent studies have found that appropriately designed on-line campaigns can easily be three times as effective as print campaigns; that you need to continue to enhance your current offering and continue to develop one or more new offerings with a high ROI potential, and that you need to continue to validate your offerings and directions with an external expert. And if you’re smart, you can stretch smaller marketing, development, and consulting budgets and get a big bang for your buck.

Because if you decide to hoard your cash, here’s what happens.

  • You cut your marketing budget and fade from memory because no one remembers you exist in the face of constant marketing from your smarter peers; as a result, you don’t get invited to the table when new opportunities arise and your pipeline shrinks until there’s no one left to sell to.
  • You cut your development budget and your solutions get stale, and even when you do get invited to the table, you lose because your competition not only has more functionality, but has new features and functions that streamline processes, improve analysis, and identify more savings.
  • You cut your consulting budget and you lose touch with your target market, going down tangents that your CEO thinks are important but that, in reality, are only valuable to one or two companies with obscure processes and, as a result, what you thought was a great new feature that would put you ahead of your competition actually scares potential customers away.

And even if you manage to make it through the recession to the next boom, you’ll be one to two years behind your competition, who will likely grow by leaps and bounds and decimate you on all fronts when you emerge from your cocoon. So, unless you’re sitting on at least three to four year’s worth of cash in the bank, which I know is not the case for over 99% of companies in this space, remember this: those who hoard cash don’t last. Another shake-out is coming … and it is the predators, and not the prey, that are going to win this round. The question is, which are you?

Keep Your New Year’s Resolution and Schedule an Appointment with the doctor

If you’re a marketing professional, chances are you just finished polishing off your marketing plan for 2009… but is it really finished? Did you remember blogger relations? More importantly, did you remember to budget for blog sponsorships and thought leadership?

It’s wise to become acquainted with your friendly neighborhood blogger, because your market is going to the blogs. And there’s one blogger in particular you need to get to know — the doctor. When a sourcing professional wants to track trends, she goes to the indices; if she wants a high level overview and some self-evident observations, she goes to the trade pubs; but if she wants some hard-hitting advice on how to combat price increases and rake in savings, she goes to one blog in particular — Sourcing Innovation. No other publication gives you the in-depth analysis and insight on vendor solutions that you will get from the doctor or his friends the Sourcing Maniacs. Ask any one of the thousands (upon thousands) of readers who visit Sourcing Innovation on a regular basis, or choose a few random posts from the dozens and dozens that appear in the Sourcing Innovation vendor post index.

If it’s been six months since your solution’s last check-up, be sure to schedule some time to check in with the doctor in the near future. If you’ve never had a check-up, now would be a great time for that first physical. There’s no better measure of your solution’s health than a private, in-depth review by the doctor; and no advertisement or white paper you publish will be as effective as a content-filled post on Sourcing Innovation. Since the doctor will never publish a solution analysis without an in-depth review, procurement professionals come to Sourcing Innovation first when they want the facts. That’s because unlike other technically-naive bloggers and analysts who believe that they can offer an informed decision based on a press release or a PowerPoint deck, the doctor always examines the patient thoroughly, and always prepares a deeply credible report.

So send an e-mail to thedoctor <at> sourcinginnovation <dot> com to schedule your appointment today! Your corporate health may depend on it.