- Supply Chain Bloggers at Gartner’s Acquisition of AMR,
- Spend Analysis Vendors at Data Mapping and Cleansing,
- Sourcing Consultants at Indirect Spend, or
- All of the Above?
You Decide!
Monthly Archives: January 2010
Web 2.0 Suicide … It’s a Good Thing
I enjoyed this recent post over on TechCrunch on how to Wipe the Slate Clean for 2010 and Commit Web 2.0 Suicide. Seems like a forward-thinking developer who was tired of living in public and sick of all the privacy theatre decided it was time to wipe the slate clean … and built the Web 2.0 Suicide Machine.
Just put in your credentials for Facebook, MySpace, Twitter, or LinkedIn and it will delete all your friends and messages and change your username, password, and photo so that you cannot log back in. There’s even a short video of the tool in action, which I’ve included below! It’s too bad that Facebook cut off access, but I’m sure some another forward thinking developer will find a work around soon enough!
And if you’re still not convinced you should unplug your web 2.0 life after reading this post on “how marketers are using Facebook to find out everything about you using just your e-mail addresses” (echoed in this CNN article) because the new Facebook privacy settings decrease your privacy by default, look at it this way. Unplugging from your social life online will leave you more time for your real life, which you’ve probably been neglecting.
Facebook at the Factory?
Sure! Why Not? While we’re at it we can get Plaxo for the plant, MySpace for the warehouse, and Back Orifice for the Office! After all, why shouldn’t we let our employees SuperPoke their buddies all day, flit away their day following their contacts’ twitter feeds, or hack into their supervisor’s computer … it’s not like they have anything better to do with their time! Right?
Needless to say I was outraged when I saw “Facebook at the Factory: Manufacturing Must Become More like Social Media” headlining over on the Supply & Demand Chain Executive site — because it’s such an idiotic idea. I’m faceless, spaceless, and twitter-free for a reason … and that reason is because these platforms offer zero value to a hard-working professional.
So I’m going to take a moment and point out the dumb conclusions the article reached … which were especially idiotic given that the writer(s) had access to a study with valid results and lots of information easily available through a Google search upon which to draw more realistic conclusions.
The article started by quoting a finding that said “62% of respondents want their ERP system to capture and record the knowledge of senior experienced engineers and professionals so that it becomes part of the corporate knowledge base”. That’s knowledge management, not social networking.
It then quoted the CTO of IFS who said “Enterprise 2.0 and social media tools are designed to draw information out of people, to get them to talk”. While this is true, it bluntly failed to mention what kind of information Social Networking sites draw out of people … their entertainment preferences, their personal preferences, and where they went to get blind drunk last night (with potentially embarrassing pictures they don’t remember taking). And what use does that information have in the daily operation of your business? That’s right. None!
Finally, it quoted the CTO of IFS who, correctly, said that web 2.0 tools like wikis, threaded discussion boards, and other features of social media will become common fixtures in enterprise software. That’s right, useful tools will become incorporated in enterprise software as time goes on. And Facebook, as of today, does NOT fall into that category.
Why Haven’t You Applied Automation to Global Trade Yet?
Considering that
- the average global trade management process has 106 discrete steps,
- we’re days away from the implementation of the penalty phase with respect to the ISF “10+2” regulations which could hit you hard this year and cost you millions,
- “reasonable care” is now a must and just one of the many reasons why you need a global classification platform,
- their support for FTZs can help you save millions during these tough economic times,
- your trade visibility success depends on it, and
- spreadsheets are NOT a global trade management solution
you have to be either extremely organized and knowledgeable about your global operations or a complete idiot not to.
And now Hausman and Lee from Stanford University and Napier and Thompson from TradeBeam have released the full study on “How Enterprises and Trading Partners Gain from Global Trade Management” (A New Process Model for the China-to-US Trade Lane) which found
- $ savings of 1.7% to 2.4% in Annual Sales for Exporters
- $ savings of 0.6% to 2.2% in Annual Sales for Importers
- a 28% to 40% increase in Annual Profit for Exporters
- a 10% to 37% increase in Annual Profit for Importers
- Manufacture-to-Invoice Cycle Reduction of 9% for Exporters
- Days Sales Outstanding Reduction of 28% to 29% for Exporters
- Order to Receipt Cycle Reduction of 35% for Importers
Extrapolating these benefits to total worldwide trade Exports and Imports based on World Merchandise Exports of 13.6 Trillion in 2007 and World Merchandise Imports of 14.0 Trillion, this suggests that the annual benefit to global supply chains would be:
- $194 Billion to $263 Billion to Exporters and
- $54 Billion to $109 Billion to Importers.
That’s free savings there for the taking! All you have to do is some business process re-engineering, which consists of:
- modelling “as-is” processes,
- designing “to-be” processes,
- benchmarking the current state,
- defining the target state,
- identifying the skills, partners, processes, tools, and technologies to get to the target state from the current state, and
- implementing, measuring, and continually improving in a methodical, step-by-step fashion, until you get there.
There are a number of Global Trade companies out there with SaaS solutions ready and willing to help you. And if you don’t know where to start, [shameless plug] you could always contact the doctor and I could help you with a needs assessment and RFP to find the right solution and partner(s) for you.
So go out and get yourself a Global Trade solution. You’ll be glad you did … especially when you come out looking like a Global Trade Hero.
The Real Reason No One’s Buying Contract Management Software
Over on Commitment Matters, Tim Cummins authored a post on The Guilty Secret of Contract Management Software where he attempted to explain the disappointing uptake in contract management software. It was pretty good, and he was right in that the uptake is not simply down to a reluctance to buy and due to a failure to achieve widespread internal adoption within many organizations that have bought. But he missed the real reason why.
According to Tim, the problem is that contract management continues to be a football, today owned by one function, tomorrow another; today centralized, tomorrow decentralized; at one moment an instrument for compliance, at the next a source of empowerment. Basically, the activities that lead to [contract] creation and management are generally fragmented. Finance, Legal, HR, Product Management, Marketing, Procurement, business unit management, Sales — all of them have an interest, yet none feels responsible.
While Tim’s observations are correct, it’s not a problem of “the buck doesn’t stop here”, it’s a problem of “where is the buck“? Even if a company appointed a head of contracts with ultimate responsibility for all contracts (which should reside in the Procurement or Supply Management department), such as a VP of contracts, you’d still have an uptake problem. Why? Because contract management systems, on their own, don’t offer much in the way of value.
But they centralize all of my contracts. So does a shared directory on the central file server. Heck, so does a filing cabinet and a little bit of diligence.
But they provide me dozens of useful contract templates. So does the CD I picked up for $5 ten years ago.
But they allow for automatic contract generation from standard clause template libraries. So does Microsoft Word.
But they allow me to query my contracts and create custom queries. So does an Access database and a high school programmer.
The simple fact of the matter is that most of what the contract management vendors sell is hot air. The real value of a contract management system materializes when you integrate it with your e-Procurement, EIPP, and/or P2P system and use it to automatically check all invoices against your contracts to make sure that
- no off-contract purchases are accepted without appropriate management approvals, and only with good reason and
- all charges are at contracted rates.
Then you stop maverick spending and overcharges dead in their tracks, which collectively account for the 40% to 60% of negotiated savings that are never realized in your average Procurement department. Otherwise, you’re just buying an over-priced content management system with word processing capabilities — and you might as well use Open Office and a centralized shared directory with naming conventions as the uptake will be about the same unless you can demonstrate how the software is going to result in real hard dollar savings.