Monthly Archives: September 2015

Twenty Years Ago Today …

… the following words were simultaneously published in both the Washington Post and The New York Times.

1. The Industrial Revolution and its consequences have been a disaster
for the human race. They have greatly increased the life-expectancy of
those of us who live in “advanced” countries, but they have
destabilized society, have made life unfulfilling, have subjected
human beings to indignities, have led to widespread psychological
suffering (in the Third World to physical suffering as well) and have
inflicted severe damage on the natural world. The continued
development of technology will worsen the situation. It will certainly
subject human beings to greater indignities and inflict greater damage
on the natural world, it will probably lead to greater social
disruption and psychological suffering, and it may lead to increased
physical suffering even in “advanced” countries.

2. The industrial-technological system may survive or it may break
down. If it survives, it MAY eventually achieve a low level of
physical and psychological suffering, but only after passing through a
long and very painful period of adjustment and only at the cost of
permanently reducing human beings and many other living organisms to
engineered products and mere cogs in the social machine. Furthermore,
if the system survives, the consequences will be inevitable: There is
no way of reforming or modifying the system so as to prevent it from
depriving people of dignity and autonomy.

3. If the system breaks down the consequences will still be very
painful. But the bigger the system grows the more disastrous the
results of its breakdown will be …

These were scary words then, and they are scary words now.

They were scary words then because they were the first three paragraphs of the Unabomber‘s manifesto — a former mathematician and Professor who engaged in a nationwide bombing campaign against people involved with modern technology where he planted or mailed numerous homemade bombs that were encased in or disguised as wood as to fool people as to the package’s contents.

And they are scary words now because while much of the manifesto is arguable, these paragraphs have an unnervingly truthful ring to them (which fades as the reader works further into the manifesto, but is there in the beginning).

1. While the industrial revolution has been a great boon for the first world countries, the third world countries have suffered. Consider our recent post on Societal Damnation 48: Worker’s Rights which exemplified the (sometimes abysmally) poor working conditions overseas that often lead to suicide and death on a regular basis. It’s bad enough that people in these poor countries still have to contend with yellow fever and malaria, two pandemics that annually kill hundreds of thousands of people, but they sometimes have to risk their lives everyday just to put food in their mouths and the mouths of their children.

2. Global Warming is increasing. And the occurrence of natural disasters due to the resulting changes in weather patterns is increasing as well. Droughts. Fires. Hurricanes. Tsunamis. They are getting worse and more frequent.

3. Continued development and utilization of technology in an uncontrolled*1 manner will worsen the situation as it has always done.

4. The industrial-technological system may survive or it may break down. We’ve seen rumblings of failure on a massive scale with recent failures of big automative companies that required big bailouts to prevent what was projected to be even bigger failures. With the return of inflation and a slowdown in global growth, we can see a breaking point. That doesn’t mean we’ll ever hit the breaking point, but it does mean that our system is not perfect.

5. If the system breaks down, the fallout will be severe and painful in first and third world countries. And the bigger a system gets before it fails, the worse the consequences.

As tempted as we are to push aside and forget the ramblings of a serial killer and a terrorist, we have to remember that despite his very misguided views, he was still a very smart man with an IQ of 167 who saw some of the harsh realities of the world for what they were. (Unfortunately, he did not see the right way of addressing them.)

I. Technology on its own is not good (or bad). It is only how it is used that determines whether it is good or bad, so we have to use it wisely.

II. If we do not replace what we take from nature, we will continue to deplete the environment, possibly to a point where it can no longer sustain us.

III. If we continue to harm the environment, it will harm us back. Nature is a delicate balance, and the more we disrupt it, the more it will disrupt us with natural disasters of unprecedented levels.

IV. If we continue to march forward like there is no limit to economic growth, we may push the system over the edge. If population growth is 1% per year, it is foolish to expect that economies can continue to grow at 4%, 6%, 8% or more per year. Simply foolish. And trying to force the system to grow at an unsustainable rate could break it.

V. If the system breaks, we go from being damned to being dead.

We don’t have the answers here at SI, but we do know that the problems will never be solved if they are ignored. And we do know that:

a. We can do our best to make sure that each application of technology is for a greater good (and not just implemented for technology’s sake).

b. We can continue to research and invest in renewable resources and product designs that use renewable resources.

c. We can build factories that use cleaner production processes, trap particulates, and filter wastewater for dangerous contaminants before such water is pumped back into streams and rivers.

d. We can create realistic growth projections and be happy when we reach them, rather than create unrealistic projections that force us to manipulate the books, steal marketshare by any means necessary, or use a supply chain likely powered by slave labour to make the numbers.

e. We can design a sustainable system rather than one with a limited lifespan.

And if we take it one step at a time, there’s no reason that the overall global situation can’t improve over time, leaving future generations to wonder how there could ever have existed a world like the one described by Mr. Kaczynski which pushed him, and other eco-terrorists, over the edge.

*1 This is one thing Mr. Kaczynski got wrong. Not all technology is bad. Most technology is neither good nor bad, it’s whether it is used or abused. Hence his claim that the continued development of technology will worsen the situation is wrong in its unqualified form.

Societal Damnation 49: Gamification

Gamification, a noun defined as the application of typical elements of game playing to other areas of activity, typically as an online marketing technique to encourage engagement with a product or service, as per the Oxford Dictionaries, is also a damnation that you need to contend with on a daily basis in Procurement.

Why is gamification a damnation? Especially since, as per Merriam Webster, it’s supposed to encourage participation as it is supposed to be, according to Wikipedia, enjoyable and motivating. There are a plethora of reasons, including:

Definitions Vary

There is really no standard definition of gamification. To see this, all one has to do is go to their favourite e-book store, download the five cheapest e-books on the subject (which may even be free), and read the first few pages. Some are focussed on the incorporation of traditional game elements, whether they make sense or not; others on team building, regardless if it is game-like or not; and others on getting marketing success or social media penetration at any cost.

Gamification is often rooted in RPGs or Video Games

Yes, RPGs are the classic team-building cooperation games and video games are all the rage, but not everyone likes RPGs (because they think of D&D and basement dwellers*) or video games (because they think of computer geeks and basement dwellers*), and not all RPGs and video games are the right fit for the task at hand.

Most of it is marketing or social media focussed

Which means that most of it is used by marketing and social media and directed at you by marketers to try and daze and confuse you, and does not help you do your job in any way.

Anything not marketing focussed is team building focussed

There are a number of methodologies out there for team building. Gamification provides little additional value in this regard unless you’re playing games that everyone likes that builds camaraderie.

As Procurement professionals, there’s nothing for us

When it comes to gamification, nothing has been developed for us. Nothing to help us. Nothing to teach us. And the beer game doesn’t count. It hasn’t been updated in fifty years, doesn’t capture the complexity of modern supply chains, and has over a dozen failings that need to be addressed in order to be useful. It’s primarily a logistics and inventory model that just doesn’t cut it in today’s just-in-time supply chain world.

In short you don’t know what it is, it hasn’t been used to help you, and suppliers’ marketers will be hitting you with their perverted version of it through broken social media channels on a regular basis. It’s a continual annoyance that serves as the background music of your eternal Procurement damnation.

* Stereotypes die hard.

Provider Damnation 68: Carriers

In our last, and only Provider Damnation post to date, we talked about how 3PL Firms were a damnation because in exchange for cost savings obtained by the 3PL, the organization gets IT headaches. In exchange for flexibility, the organization gets a loss of visibility. And in exchange for focus, the organization gets a complete loss of control.

At this point, carriers might have thought they got overlooked because we chose to focus in on the 3PL that wants to take over part of your business and make you as dependent on them as an addict on meth (which is one of the most physically addictive drugs ever created) and seemingly overlook them. But like an elephant, the doctor never forgets that all they do is hide yet another layer of damnation – the carriers themselves.

Thanks to the outsourcing craze that began in the 80’s, no one makes their own stuff anymore which means that they are dependent on logistics carriers to get the products to the warehouses and then again to get the product to the retail stores. And these carriers know that, to use a common expression, they got you by the balls. Now it’s true capacity isn’t always at full capacity, especially in off season, and at these times there is some negotiation room, but at peak season when the holiday rush is closing in and half (or more) of your annual sales are at stake, and they’re at peak capacity, they’re in control and they know it.

Fuel surcharges pile up. Overtime charges pile up more. And you’ll pay because if you don’t, your product won’t arrive on time, putting your sales, and profits, at risk. But this isn’t the biggest problem.

It’s bad enough that they can put you over a barrel at any time, but it’s even worse when you can’t even get your product delivered. There has been a shortage of drivers for the past decade, and it’s only getting worse. According to a recent article over on JOC.com, not only is the US truck driver shortage getting worse, the driver shortage in the US alone is now an estimated 40,000 drivers with a turnover rate of 96%. But this is just the tip of the iceberg. With so many drivers set to reach retirement age over the next 5 to 10 years, the global driver shortage could reach into the millions in the next decade.

According to a joint report just released by the U.S. Department of Education, the U.S. Department of Transportation, and the U.S. Department of Labor entitled Strengthening Skills Training and Career Pathways across the Transportation Industry, more than 2 million jobs in the trucking subsector will need to be filled within the 2012-2022 time frame and nearly half will be in the trucking sub-sector as more than half of the current truck drivers will reach retirement age by 2022!

Soon it might not be a matter of how many ridiculous overcharges and surcharges you have to pay at peak season to get your product delivered, it will be a matter of if you can even get your product delivered at all! (Let’s put it this way, unless you’re ready to embrace Uber-like delivery services, this is likely going to be a reality very soon.) Carriers have you over a barrel, and soon, from lack of good planning, they’re going to lose that barrel, leaving you stranded on a bare dirt road. The only upside is at least you’ll be in the right place to summon a crossroads demon should you choose to embrace the damnation that is coming for you.

At this point, SI has to ask, do you still doubt this is the year of damnation?

Societal Damnation #48: Worker’s Rights

Now, you’re probably wondering why this is a damnation. Worker’s rights are a good thing, and if one is ethical, there’s absolutely nothing wrong with them or respecting them. The problem is, not everyone is ethical, especially in the corporate world. One has to remember that 1% of the population are psychopaths (with enduring antisocial behaviour, diminished empathy and remorse, and disinhibited or bold behaviour), and that the top four professions that attract psychopaths are

  1. CEO
  2. Lawyer
  3. Media / Publicist / PR / Marketer
  4. Salesperson

and four of the five jobs that every company relies on. You can’t have a company without an incorporation, and laws are so convoluted in most places that you pretty much need a lawyer. Plus, once you get big, you’re gonna get sued. A company needs a leader. A company has to sell something to survive, and it has to advertise that something. The only other must is that it must keep its books and pay its taxes (Finance). In a nutshell, your company is evil. The only real question is “how evil”. Skim a bit off the top evil? Steal from sick grandmas evil? Drown the kittens evil? Or sell guns on the mass market to a guerrilla group planning a coup and a mass genocide evil? (Google knows this. Why do you think it’s motto is “don’t be evil”? It knows that, especially with the power it holds, without a constant, conscious, effort to not be evil it wouldn’t take much to fall down that slippery slope and become the most evil weapon of the most evil empire on the planet as it has access to more data than even the NSA.)

In a nutshell, regardless of the talk they talk, or the walk they walk when they are looking, these psychopaths don’t care about respecting worker’s rights beyond what is absolutely mandated under law (as they don’t want to get sued or fined as that tarnishes the brand imaged which, for most companies these days, is their biggest asset and, thus, their biggest money maker).

Now, this wouldn’t be a problem if every country had good worker’s rights laws and agencies that insured those laws were enforced, but we know that, outside of the prosperous first world nations, there is a lack of worker’s rights laws, if there are any laws at all. In some countries, it’s not uncommon for employers to force employees to work 12 hours a day, in unsafe working conditions with insufficient access to clean water, without any protective gear, under the constant fear of immediate dismissal without recourse if they don’t hit high productivity targets for wages less than what an acceptable minimum wage would be if there was one. If working conditions were good across the board, employees had access to the help and services they need, and employees were generally happy, you wouldn’t see headlines like this Headline from the Huffington Post in 2011 that said Apple Manufacturer Foxconn Makes Employees Sign ‘No Suicide’ pact, which, of course, followed headlines like Foxconn worker plunges to death at China plant, which were numerous as at least 20 employees attempted suicide in 2010 and 2011 at Foxconn, as chronicled on the Foxconn Suicides Wikipedia page.

And while we might want to pretend the companies we buy from are socially responsible and only buy from companies that are themselves socially responsible, that’s not always the case. (We shouldn’t have to enact anti-human trafficking laws in the supply chain in this day and age, but California and the UK just did because we still have to!) If the companies we bought from really were socially responsible, we wouldn’t have seen the headline that More than 100 die in garment factory fire, the deadliest in Bangladesh’s history or Death toll from Bangladesh building collapse climbs above 400 as no one would have working in these buildings to begin with if these companies were socially responsible and respected the rights of a worker to work in safe working conditions.

And making sure your suppliers respect workers rights, so you don’t get a media black eye and a tarnished brand, is not so easy. You can’t schedule an audit — they’ll clean up the plant, instruct the workers who are the most subservient on what to say, send any they don’t trust home, reduce numbers to those they have sufficient safety gear for, and even bring in a doctor for a day to show you they care about employee health. The next day, the doctor is gone, the facilities are dirty and crowded, and it’s back to business abusing employees as usual. Now, if they know you might show up for random audits, they’ll employ one or more tricks to make it look like they’re better than they are, which might include misdirection or outsourcing.  We’ll tackle misdirection first.

If the supplier is big enough and serves enough big customers, they will need multiple plants and locations. A cunning supplier subject to, or afraid of, random audits will designate one plant as the “customer” plant for *every* customer, and in that one plant they will be sure to spend extra time making sure it is clean, uncrowded, and safe. They won’t get much done in that plant, because the whole point will be to make sure it always looks good for a surprise visit. Meanwhile, their other plants will be overcrowded in squalor conditions to keep their overall cost low.

Smaller, cunning, suppliers, who can’t afford extra factories, or don’t want the headaches of having to appear responsible at all times due to the threat of constant, random audits will instead outsource the more dangerous, dirty, or workforce heavy task to a sub-supplier who they claim will meet the requirements you place on them for fair worker treatment but who, in essence, do not come anywhere close.

It’s a management nightmare with the constant risk that a bad media circus could erupt at any time.  It’s pure damnation as you will do your best but still get blamed when a scheming supplier does its worst.