Category Archives: Knowledge Management

For A Believable Vision Of Procurement 2020, Head Back To 2008

Long Before Ariba published their 20/30 Vision of the Future of Supply Management and Aberdeen took us back to 1999 with their vision of the next decade of Supply Management, the leading Supply Management minds at Hackett sat down and came up with their vision of Procurement in 2020 which was a heck of a lot better than most of the stuff I’ve seen this year (with a notable exception being Bob’s Next Level Supply Management).

In Hackett’s 2020 Vision For Procurement: A Revolution Through Evolution of Capabilities and Value (which was released as their Procurement Executive Insight on April 15, 2008 and followed by their 2020 Vision: Delivering on the Evolving Value Proposition of Procurement which was detailed in their 2008 Book of Numbers), Hackett identified the emerging trends that will define tomorrow’s world-class performance and help an organization move up the capability path. Realizing that transformation in most organizations is evolutionary, and not revolutionary, Hackett’s leading minds lay out an evolutionary path that takes organizational capability from reactive to strategic in a four-step process that passes through planning and alignment along the way.

The authors note that while an average Supply Management organization starts out with the goal of assuring supply, this is a very reactive strategy. Supply Management has to get to the point where it is harnessing the power of supply markets to maximize the value it is getting from its spend, to enable business strategy, and to optimize its tactical execution. Along the way, Supply Management will progress through TCO and demand management. As it progresses to harnessing the power of supply management, the organization will continually expand its circle of influence, dig deeper into its customers needs, and provide better service as time goes on.

In addition, it will also need to acquire the following strategic capabilities:

Business Process Sourcing
Supply Management will need to become the starting point of BPS activities and skillfully integrate disparate methodologies surrounding core competency analysis, resource management, service delivery models, business process management, and portfolio management into its overall supply management practice so that it is the first business unit consulted, and not the last, in any conversation surrounding business process (out)sourcing.

Supply Performance Management
Supply Management will go beyond simply managing the inbound supply chain to shaping strategies, goals, and objectives for the business as a whole based on its knowledge of global supply markets for materials, talent and technologies. It will need to seamlessly integrate supply planning with financial planning and operational planning so that each decision is best for the business overall.

Knowledge Management
It will need to master content-driven analytics which integrate external data into internal data models for supply prediction, planning, and risk mitigation that will allow it to build robust and agile (virtual) supply models that can be redesigned as needed in response to significant events.

Talent Management
Supply Management will need to adopt a cradle-to-grave talent management framework that includes knowledge management and advanced training models that allow it to advance its personnel to the next level. The framework will need to contain an innovative “brand management” model that will differentiate Supply Management as the career path of choice for new talent.

New Product Development and Introduction (NPD/NPI)
Supply Management will have to include advanced design-for-supply support that incorporates multi-tier cost modelling, scenario
planning and optimization that will allow the organization to understand the critical relationships between requirements, specifications, costs and constraints and make the best design decisions for the business overall.

Supplier Management
Supply Management will have to proactively engage suppliers and extend internal competencies and knowledge into suppliers’ operations
to increase their process capabilities, financial health and goodwill toward the buyer. Supply Management needs to progress to the point where it is able to detect a potential problem before the supplier detects the problem, and then step in to help the supplier resolve it before it materializes.

Next Level Strategic Sourcing
Strategic sourcing has to advance well beyond TCO modelling and the application of the best e-Sourcing tools to the point where it is using deep supply intelligence to identify unseen risks and anticipate supply capabilities that can deliver breakthrough improvements in innovation, environmental sustainability, new market entry, brand enhancement and other key business strategies. It will utilize scenario planning on the extended supply network to provide visibility of opportunities and risks that will guide Supply Management to the right buy for the organization every time.

Good Networking Tips from the CPO Agenda

A recent article over on the CPO Agenda on how to get “in with the in crowd” had some great tips on networking, especially for those new to the on-line networking scene. Diving right in, they were:

Start Social
Social networking platforms allow you to reach out to people you haven’t seen or spoken to in a while that you used to work with. It’s often easiest to start networking with people you already know.

Choose Your Platforms Carefully
The article points out that LinkedIn is the most effective and valuable site for professionals, not Facebook, which is great for friends and family, but not business. SI agrees and is quite happy to see that there are experts who know the difference. It also gets Twitter right. Use it to follow companies to get information on changes to the business, best practice, or new legislation but don’t expect much more from it.

Systemize Your Contacts Strategy
Start by making a list of people you have not connected with in a while who have been helpful to you or who you have respect for and create a plan to keep in touch with them regularly.

Step Outside of Your Comfort Zone to Meet New People
Start by offering to do projects that are outside of your normal scope of work that will help you meet new people and suppliers, but for which you will have support from your team, who can often make the initial introductions.

Only Attend Events You are Interested In
Not only are many events a waste of time, but many don’t draw the crowd they advertise. Plus, even if the event draws a decent mix of professionals, if the event holds no interest to you, people will sense it and may assume that they have no interest to you, which will destroy any chances you have for good networking. Also, try to select an event where people you know typically go as well and arrange to meet up with them while there. Not only will it insure that the event is not a total waste of time, but your connections can introduce you to new people.

And, when using LinkedIn:

Have a Good Profile
It’s important to have a strong and authentic profile that allows people to see how you have developed throughout your career. And don’t forget the picture.

Connect Wisely
Although you want a strong network of at least 100 people, don’t connect with this anybody and everybody. First of all, you can only maintain real relationships with so many people. (British anthropologist Robin Dunbar puts the upper limit at 150 friends based on our brain size.) Secondly, you don’t want to look like a connection whore, err, super networker. In-depth network analyses show that they are not the source of online conversations. They are the sink hole where everything ends up.

Remember Online Etiquette
Simply put, it’s not okay to send direct messages or ask for favours from people you don’t know and haven’t met. You should be introduced first.

It is Better to Give than Receive
Build a reputation as a giver to a community. However, don’t just share interesting articles that are relevant to your network. Also take the time to explain why and add to the conversation.

Is It Social Software or Collaborative Knowledge Management That Gets Results?

A recent article over on Chief Executive on Tying Social Software to Business Metrics that Matter indicated that one of the biggest opportunities a company has to drive operating performance to new levels, run lean, innovate, and accelerate talent development is to tap the full capabilities of social software. As proof, it references “social software” deployments by OSIsoft, that realized a 22% improvement in average time to issue resolution through customer support’s use of Socialtext wikis, and Alcoa Fastening Systems, that reduced compliance activities by 61% using an internal collaboration platform.

Seems to me that the author is confused. “Social” software, at least in the common vernacular, refers to the social networks like Twitter, that makes a twit out of you, Facebook, that is contributing to the downfall of western civilization as you read this, and similar sites that have no real value and only provide you with ways to poke, prod, ping, and tweet your valuable time (and intelligence) away.

Wikis and similar platforms are really collaborative knowledge management platforms that allow users to collect, share, and create new knowledge that can help them advance themselves and the organizations they belong to, unlike social sites that only help them flitter their time away through pointless games and photo sharing. Yes there is a social aspect, but its about collaboration for education and innovation, not to see who can get the highest poke per minute count or follow the most twits who spend their days tweeting about how great Britney looks in her new outfit.

Social platforms only increase endorphins. In order to get results, you need to increase serotonin. That’s what collaborative knowledgement platforms do. Don’t get them confused.

Ariba Vision 2020: Tomorrow’s Shoes (Part I)

This is the first of two posts that address the fourteen predictions that were dead on in Ariba’s “Vision 2020 – The Future of Procurement” report. Any Supply Management organization that recognizes the truth of these predictions is well on its way to formulating a plan to be a leading Supply Management organization in the decade ahead.

01. Everything is automated

This prediction is dead-on. Next Generation Supply Management shops are investing heavily in technology to automate all non-strategic and low-value supply management activities, leaving the sourcing professionals to focus on strategic and high-value categories where they can extract the most value for the organization.

07. Spend management shrinks

I’ve said it before, and I will say it again: Spend Matters Not. It’s not how much you spend, how you store it, how you cube it, or how you report on it — what ultimately matters is how much you get from it, profit from it, and derive value from it. Next Generation Supply Management organizations are focussed on improving business outcomes, not cutting costs until quality and stability of supply suffer. Spend Management will shrink as true Supply Management focussed on value takes its place.

09. Service providers excel

Given the increasing cost of outsourcing complex and strategic functions to emerging economies where labour rates are rising exponentially, in order to maintain cost competitiveness and deliver value, the service providers will provide service that constantly improves in efficiency and execution.

13. Let’s get financial

Since overall financial success will still be the ultimate measure of value generation in public enterprises, Supply Management will revolve around the financial supply chain and will be heavily involved in optimizing cash flows, working capital, and financing programs from NPD through return and disposal.

14. SM pros get sophisticated

Supply Management professionals will definitely be much more sophisticated in 2020 than they are today. As the secret agents that essentially drive all aspects of the business, their business savvy, analytical capabilities, relationship skills, and overall execution abilities will be, for the most part, a level above where they are today.

15. Supply pros expand expertise

This is the obvious result of a supply managmeent professional getting more sophisticated. It should not have been included as a separate prediction because it’s impossible to get more sophisticated in Supply Management without expanding depth of expertise in key areas.

16. Strategy scope widens

One does not get to the next level by maintaining a narrow focus, so it should also be obvious that the scope of strategy addressed by an average Supply Management organization is going to expand as well. The strategy will be more closely aligned with the needs of the organization’s end customers and be more cognizant of the needs of the current, and future, customer base. Supply Management will be increasingly called upon not only to analyze merger and acquisition possibilities, but to lead the initiative as success will depend upon succesfull integration of the end-to-end supply chains. And it will be involved in all NPD from day one to help identify customer needs and supplier capabilities before any decisions are made.

The next post will address the other seven predictions that were dead-on.

Apprenticeship is the Answer

Back in March when I asked if we can fix supply chain education because academic programs, third-party programs, private programs, and vendor programs are, for the most part, not meeting our needs, I pointed out that the answer was to go back in time to when apprenticeshipos were common. When students studied on the job under the guidance of a master who prepared them for the job they had to do, not to advance an understanding of purely intellectual pursuits devoid of a real world application.

While I didn’t get much of a public reaction, I did get some very positive feedback from some old-school folks who have tried everything and realized that work-alongside training is the best answer. But a few old coots, as brilliant as they may be, do not deliver enough critical mass to get the idea out there. However, it seems that India is proving my point. As per this recent article over on Global Services that asks if “everything we know about offshoring innovation is wrong”, not only does an appropriately designed test prove to be a better indication of ability than a University degree, but intensive on-the-job training under a skilled expert tends to produce a better worker in months than is typically produced by years of higher education.

In other words, apprenticeships are the answer.