Category Archives: Miscellaneous

Can You Detect Greenwashing?

Can you detect when a supplier is Greenwashing their product or service? Are you sure? Did you take part in Earth Hour? You did? Guess what! You probably can’t detect greenwashing!

Earth Hour, another stupid marketing gimmick supposedly designed to get the message out about responsible energy usage, actually encourages the exact opposite by telling everyone to stop using power — at the same time — for one hour. Then, at the end of the hour, everyone — at the same time — turns their lights, tvs, and washing machines back on. This is the kind of action that can bring down a power grid, and, guess what, cost more energy then is saved in some cases. (Very little energy is actually saved, by the way. Less than an hour’s worth of lights or TV. You know why? When the hour is over, people are still going to do their laundry. They are still going to cook in their ovens. And they are still going to use whatever power hungry toys they have in their house.)

If you were a power engineer, you’d know that grids are designed to work where energy requirements are at rather constant levels. Basically, in laymen’s terms, whatever is put on to the grid has to be taken off, or the grid will blow. Similarly, if too much energy is taken off too fast, the grid can blow too. If power usage all of a sudden drops 50%, sometimes entire plants have to be rapidly taken off-line. (Which can be a problem if you have a nuclear plant in the mix. You just can’t shut one of those down on a whim!) This wouldn’t be a problem if it wasn’t for the fact that it takes a lot of time and energy to start up certain types of power plants. Water may turn turbines on its own when they are placed in a waterfall thanks to gravity, but sometimes a kick is needed to start a wind turbine. And coal burning plants don’t start up at the flick of a switch. It takes thousands of households turning off tvs and lights to equal the power required to start a small power plant. Imagine the power wasted shutting down and starting up a large power plant in one hour.

But I digress. As per the Sins of Greenwashing, maintained by TerraChoice, only 4.5% of products in 2010 were sin-free. Only 4.5%! The average claim is stretched so far from the truth that it’s only basis in reality is that the words used to describe it are part of the English language (most of the time). This is important to keep in mind with Earth Day coming up in two weeks and marketing folks getting ever more keen to tap into all the hoop-la that it entails. (Not that Earth Day is bad — just the marketers who try to sell non-green products and services as green.)

So how do you detect greenwashing? Familiarize yourself with the “10 Signs of Greenwash” developed by Futera and documented in this guide on Understanding and Preventing Greenwash co-developed with BSR. In brief, they are:

  1. Fluffy Language
  2. “Dirty Company”
  3. Suggestive Pictures
  4. Irrelevant Claims
  5. Best in Class
  6. Just Not Credible
  7. Jargon
  8. “Imaginary Friends”
  9. No Proof
  10. Out-Right Lying

Are You Revenue/Growth Enabled? Take This Hackett Group Survey and Find Out!

Today, the Hackett Group released their latest study — the Revenue Growth Enablement Study. The goals of this study are to determine in what ways a Procurement organization can enable revenue/growth scenarios for the organization as a whole, how far an average organization is down the revenue/growth enablement path, and what practices leading organizations are using to enable revenue/growth. Given the burning need for leading Procurement organizations to not only do more with less, but contribute to the top and bottom line in even more ways, this is an important study. For Procurement to earn, and keep, that seat in the C-Suite, it has to continue to deliver value year-over-year. And the best way to deliver that value, once it has trimmed costs, is to help the organization grow (with its expertise in operations management), globalize (with its expertise in foreign markets) and increase revenue (with its expertise in logistics, multi-stage and multi-channel inventory management, and new product introduction [NPI]).

Not only will this study give you ideas on how to identify growth priorities, tactics to support those priorities, metrics to measure success, NPI, and support sales and marketing, but it will qualify you for the full study results and final report when the study is complete. And in the meantime, you get one of the following five reports free upon survey completion:

  • 2012 Procurement Key Issues Study
  • Category Management – Beyond The “Strategic” in Strategic Sourcing
  • Supplier Relationship Management (Part I: Tapping the Power of Top Performance in SRM)
  • Defining & Expanding the Value Proposition of Purchase-to-Pay
  • A New Procurement for a New Normal

The 2012 Procurement Key Issues Study identifies the top 10 issues for Procurement organizations in the coming year, with the acceleration of revenue growth leading the way. (That’s why this study is so important.) It also discusses some key strategies for enabling profitable growth, including globalization — which will nearly triple within three years, as determined by the Hackett Group in their “Globalizing Procurement’s Service Delivery Model, Not Just the Supply Base”. (For some key stats, see SIs recent post on The Global Agenda — It’s Coming!.)

The study on Category Management, which attempted to go beyond the “strategic” in strategic sourcing, found that despite the additional savings opportunities that can come from category management (as chronicled by a number of Procurement leaders in Hackett’s conferences last year and by leading sourcing platform providers like BravoSolution), only 5% of companies have a category-focussed strategic sourcing process that is very well implemented or truly strategic. The majority of companies pursuing strategic sourcing (54%) are just average with a process that is fairly well implemented, but which does not push the boundaries. The report, which clearly defines the difference between a standard strategic sourcing approach and a category management approach, takes a deep dive into category management objectives and strategies, the supply management service line it enables, and provides a strategic category management framework that can jump-start an average organization looking to take it to the next level.

The study on Supplier Relationship Management, the first in a series, is extremely insightful on the importance of good SRM which is not just foundational for sourcing success, but transformational from a value viewpoint. It was found to increase cost savings / avoidance in top performers by almost 80% and growth-related benefits by 53%! SRM drives almost 45% of total Procurement value in top-performers! This is a level of improvement not achievable by any of the “Top 10 Technologies for Supply Management” on their own or even combined in a pair! Only collaborative sourcing, which embraces supplier relationships, can reach this level of value. The paper also identifies key differentiators of top performers and a model for SRM success that you can use to jump-start your organizational effort.

I haven’t reviewed the last two papers, but Sunday’s post pointed out how the UK Government expects to save £40 Million a year just by paying SME construction suppliers directly through P2P. P2P is full of opportunity, and I’m sure this paper will provide deep insights that can be used to jump-start an initiative. Finally, while There Is NO New Normal … Just the Old Normal Coming Back, there is a need for New Procurement Technology to cope with the return of an Old Normal that had passed before such technology hit the scene, and if any research organization is going to nail what that technology is going to be on the head, it’s the Hackett group.

To take the the Revenue Growth Enablement Study (enabled by their new, interactive, Qualtrics tool), and get your free research (and make your organization better for it), join the “World Class Procurement” LinkedIn Group.