Category Archives: Talent

The Talent Series VIII.V: Boarding the Bandwagon

I’ve been bemoaning the talent issue for months – ever since I realized that it was a lot worse than just about everyone* would like us to think that it is. With the exception of a few brilliant posts on the Spend Management Talent Game (Part I*, Part II*, and Part III*) by The Prophet, and a few posts back in September on “Attracting Great Talent the Jack Welch Way” by Tim Minahan on Supply Excellence [WayBackMachine] and “Behaviors Correlated to Performance” by THE BLOGGING THUNDER FROM DOWN UNDER on Vendor Management (renamed Contract Capital Management, [WayBackMachine]) it seemed as though I stood alone in my belief in the criticality of The Talent War and my continual efforts to convey to you the extreme urgency of The Impending Crunch.

Fortunately, Aberdeen has raised the alarm and both Supply Excellence and the Purchasing Certification Blog [WayBackMachine] have taken up the cause.

Now you can be confident that I’m not just echoing the cries of the recruiting agencies (whose profits are highest when your needs are most desperate) and go out and attack the problem before it attacks you. I still recommend the Talent Acquisition Strategies I laid out previously and would also recommend that you use my other posts in The Talent Series as a starting point for your research in your efforts to define winning strategies.

* With the exception of the 3rd party recruiting agencies, of course – but they’ve been crying wolf for so long, it’s often easy to ignore their cries.

* All posts prior to 2012 were removed in the Spend Matters site refresh in June, 2023.

Scott Adams, A Supply Management Guru?

Regular readers of this blog or Spend Matters should recall Jason Busch’s post on “The Spend Management Talent Game”# where he indicated that when seeking out talent, an organization should value generalist skill sets, raw intellect and EQ (emotional intelligence) over industry and domain knowledge. Spend Management professionals need to understand the world around them and possess general problem solving skills that go beyond functional — or even technology — knowledge. Technology skills can be taught. It’s far harder to find someone with the analytical skills to navigate complex total cost decisions and the emotional maturity and interpersonal skills to sell such analyses both up and down the company.

In simple terms, if you want to be a better supply chain professional, you should focus on improving your general problem solving skills and EQ first, since domain knowledge is much easier to learn and can be readily absorbed from an appropriate expert once you have the raw intellectual capacity to absorb it. Furthermore, since EQ is required for general problem solving skills, and since general problem solving skills can be improved through repeated application using tried and true problem solving methodologies as guides (some of which I have discussed here in this blog or in my summer series over at e-Sourcing Forum [WayBackMachine]), it should be clear that your number one goal is to improve your EQ.

So how do you improve your EQ, which is not the same as improving your emotional range? (i.e. Sitting around watching chick-flick movies all day won’t help us guys.) I’ll admit that I struggled with this for a bit until I realized the answer was obvious – learn from the best, and if you can find one, a guru. But where do you find an EQ guru? One who will happily share his or her wisdom, and preferably, share such wisdom with you regularly simply for the satisfaction of knowing that he or she may make you a better person? (After all, a true guru is one who readily shares his or her knowledge, not one that sells you snake oil until you’re broke and then vanishes.) After all, the world of business is littered with “finance” gurus or “real estate gurus” or “M&A gurus” or “management gurus”, not EQ gurus. So I was back to square one – no idea on where you should go to improve your raw EQ (since my strengths are in problem solving and application of such techniques to the supply chain domain and imparting sophisticated domain knowledge in the areas of math, computer science, and logic) since I wasn’t sure where to go to improve mine.

Then it dawned on me – the answer was under my nose all along! (Literally, since today I’m smelling sweet Bay Area California air, and since I live in the real NorthEast, at this time of year my nostrils would normally be too cold to smell anything!) I was already absorbing great advice from an EQ guru everyday, and didn’t even know it! And for you non-observant, that Guru is Scott Adams, author of the Dilbert Blog (and the Dilbert comic strip, and four of the best business books ever published, etc.).

Moreover, some of his advice is so good, that I would say he could even be proclaimed a Supply Management Guru! Furthermore, I am going to present my case solely on the insights that he has shared with us in the past month alone!

October 24, 2006 Good News Day
Scott proves that optimism is a powerful tool and that just because no one else has ever recovered from a seemingly hopeless situation or solved a problem before does not mean that you can’t be the first! Furthermore, I would like to add a corollary to this that just because someone says you cannot do something, it does not mean they are right. Usually it means that they cannot (or believe they cannot, but that’s the same thing.) There is a chance that they may be right, but it is often a (diminishingly) small one. Furthermore, a failure is always relative to certain conditions or assumptions. So next time someone says something like “We tried that ten years ago, and it didn’t work.“, don’t accept it at face value. Find out precisely what they tried, what precisely they did, and precisely what the assumptions and market conditions were. If the conditions have changed, if the project was managed poorly, or if the arrangement was arms-length, maybe a different arrangement or management structure will work today.

October 25, 2006 My Day as a Neanderthal
Scott tells us that he feels cut off from the world when his primary means of communication and interaction goes down, and points out that we are at our best not only when we use all the resources that are at our disposal, but work with others whose knowledge and skills can complement our own.

October 28, 2006 I Got Your Free Will Right Here!
Scott asks “If free will exists, why do the tallest candidates with the best hair usually win elections?” and points out that the correlation is incredibly strong despite that the most poorly informed voter understands that neither hair nor height have any correlation with competence. He also points out that you can see the same bias in favor of tall, good looking people in business too and that there are plenty of studies showing that tall and/or attractive people earn substantially more than short, ugly people and they get promoted faster too. Furthermore, there are tons of similar examples where companies can manipulate customer behavior by altering colors and music and odors at stores and that none of those things change the quality of the products, and yet they change people’s buying decisions.

In other words, we’re naturally very illogical people and we have to work hard to make sure that logic is the basis for our decisions, not just gut instinct.

November 2, 2006 Stem Cells
Scott says I don’t debate with advocates. An advocate says that everything is right about one position and everything is wrong about the other side. You might as well debate with a doorknob. I only debate people who say, in effect, “There’s an argument to be made on both sides, but here’s why one side seems more persuasive.” That person could theoretically be swayed by new information or a better argument. Simply put, you can’t be logical with the illogical. Don’t butt heads – it’ll have the same effect as pointing out the inconsistencies in the bible to a Jehovah’s Witness. If you can, work around these individuals. If you can’t, you’ll either find a creative way to make your position more attractive to the irrational nitwit or consider a job change. (Otherwise, you’ll just stress yourself out for no good reason.)

November 7, 2006 My Search for Clarity
In a clear demonstration of his wisdom, Scott says as regular readers know, I am too ignorant to have opinions on most big issues. It does not matter who you are, you do not know everything. This also means that you cannot be an expert in everything. The only way to grow as a person and improve your skills is to admit what you don’t know and then seek out that knowledge.

November 14, 2006 Are Smart People Dumb?
Scott asks Why would I limit the quality of my advice to people who don’t know any more than I do? In other words, just because someone is famous, your superior, or your mentor, it does not mean that they will always have the right answer. Just like the rest of us, they have their areas of weaknesses as well as their areas of expertise. When you have a tough problem, go to the experts and see what they have to say. And the s is bold for a reason. You should seek multiple opinions, and explanations therefor. Experts are people too, they don’t always agree, and they will occasionally be wrong. (Just significantly less than the average person, as that’s the definition of an expert.) Furthermore, Scott also points out that genius alone does not a smart person make, especially when it comes to a (specific) real world problem.

November 16, 2006 Who Can’t be Hypnotized?
Scott deftly points that we are all in the business of influencing people and outlines the technique of hypnotic induction that you can use to help calm the tense individuals who will be reading and judging your work and ease them into the relaxed state of mind that they will need to be in to make a fair assessment.

November 17, 2006 Aging Brains
Scott tells us that we should release all knowledge of complicated explanations for the world whenever simpler ones will do the trick. The KISS rule is universal. Don’t forget it!

November 18, 2006 Philosophical Brevity
If you want to get your point across, be smart and brief.

November 24, 2006 Complicated Decisions
Scott points out that he often makes a decision on the easy to predict and important factor(s) and ignores the impossible to predict factors. This is because while you can’t know the RIGHT decision, you can know the RATIONAL decision. Although you can’t always ignore the unknown, the reality is that the unknown should not be the basis for your decision. After all, there will always be unknowns. Let’s choose freight. The airplane could crash. The boat could sink. The truck could be stolen at gunpoint. It doesn’t matter, there is always risk. If you’re worried, take out insurance. However, the airplane will be fastest and cost the most. The cargo ship will be slowest and cost the least. If speed is of the utmost importance, choose air. If cost is of the utmost importance, choose sea. Strike possibilities, terrorist attacks, etc. etc. etc. are always there, regardless of method, so don’t base your decisions on these unknown factors. Simply have a backup plan in place to mitigate risk, insurance to mitigate loss, focus on what’s important, and get the job done. Otherwise, you’ll be a hypochondriac before you know it.

And if that does not convince you that Scott Adams is an EQ and Supply Management Guru, I don’t know what will. Furthermore, he also doles out great advice on a wide range of topics on a regular basis. In the last month alone, he has told us how to Avoid Obscenity in our Documents*, select Comic Assess we can safely post on our cubicle walls, and be featured on 60 Minutes. What more could you ask for?

* If you don’t get it, you should use bullets, not asterisks.

It's too bad Scott Adams had to take these classic posts down on request of Portfolio Hardcover when they published Stick to Drawing Comics, Monkey Brain that was a collection of his blog posts through part of 2007.

# All posts prior to 2012 were removed in the Spend Matters site refresh in June, 2023.

The Talent Series VIII: Talent Acquisition Strategies

Back in June, Aberdeen Group released The “Talent Acquisition Strategies” Benchmark Report: Sourcing and Assessing the Best of the Best that address the criticality of investing in a talent acquisition strategy as a way to identify, attract, and engage high performers given that today’s organizations are facing a market with not enough qualified employees to fill necessary job roles, i.e. The Talent Crunch.

According to Aberdeen, talent acquisition involves the planning, sourcing, assessing, hiring and on-boarding of top talent. Sourcing candidates is a way to identify and attract qualified individuals whether they are actively looking or not and assessment involves the skills tests and behavioral assessments necessary to evaluate the ability of the candidate in a given role.

As usual, Aberdeen found that there is a sharp distinction between best performing companies who are tackling the talent crunch and average players who have done little more than adopt a talent mindset. Best performing companies distinguish themselves by leveraging technology to manage the sourcing, assessment, and hiring process and creating long-term strategic plans for talent acquisition that:

  • improve their corporate brand
  • create a pool of qualified candidates
  • improve their strategic workforce planning
  • utilize technology

As proof that a talent acquisition strategy works, Aberdeen offers us the following statistic: 59% of high performing companies have increased their overall workforce performance after implementation of a talent acquisition strategy compared to 41% of industry average and 33% of laggard companies.

The report found that Job Boards and Employment Websites are number one – with companies spending over 80% of their talent acquisition budget on job boards and company employment websites (according to the “Enterprise Talent Management” study), which is probably due to the fact that job boards have an increase in the quality of hire (48%), a decrease in the cost per hire (38%), and time per hire (44%).

Furthermore, the report found that 90% of Best in Class companies have aligned talent acquisition to their company’s overall strategic plan. Furthermore, best-in-class companies have a yearly hiring management plan that covers all hiring levels and includes contingent plans for unanticipated hiring needs.

The Aberdeen report offers the following recommendations for action:

  • align talent acquisition strategy with the overall corporate strategic plan
  • measure workforce performance based on quality of hire over cost per hire and time per hire
  • recognize that “one size does not fit all”: what works for talent acquisition in one company might not work for every company
  • eliminate paper and spreadsheet based processes and use technology solutions
  • focus on a long-term plan for talent acquisition
  • manage the whole workforce

These are all good recommendations, but you should also note the following:

  • job boards and employment sites are great, but with their increasing popularity you need to remember that the same candidates they deliver to you will also be delivered to dozens of your peers, so make sure you have a compelling brand to fall back on
  • your best channel will always be referrals from your own top employees, make sure to track each and every one – even if a candidate referred to you is not available now, or not the right candidate for the position you need to fill today, it does not mean that she will not be available tomorrow or the best fit for the next position that opens up
  • metrics are good, but positions filled with highly capable individuals are better – and it’s really hard to measure “quality” (on the other hand, productivity is often more easily captured if you make a product or bill a service)
  • although spreadsheets are not the best solution, don’t throw away Excel just yet – a good product will integrate with Excel and save your staff from having to learn a new interface (and save you training time and dollars)
  • one size may not fit all, but that doesn’t mean you shouldn’t at least explore ideas that have worked for other firms – sometimes only a few small tweaks are required

The Talent Series VII: The Spend Management Talent Game

In his series of posts on The Spend Management Talent Game (Part I* , Part II*, and Part III*) over on Spend Matters, Jason Busch discussed some of the issues that affect an organizations suffering from a talent shortage and offered some advice for identifying talent.

Organizations that lack the necessary talent to compete at the top level in today’s environment often are able to identify results, but have a hard time translating paper-based savings from screen-shot trophies to those that drop to the bottom line. And as we know, opportunities and well negotiated contracts alone do not generate savings, a good follow-through led by a skilled individual is required. And, more significantly, Organizations suffering from talent deficiencies place too much emphasis on checking boxes for boxes sake. As Jason points out, your tools should not drive your processes, your holistic strategic sourcing model compliant with your overall supply chain model should.

So what kind of talent do you need to transform your ogranization from a reactionary technology-driven tactically-focussed organization to a proactive strategic sourcing organization? According to Jason, you should focus on talent with generalist skill sets, raw intellect and EQ (emotional intelligence) over industry and domain knowledge in new hires. It’s essential that they have general problem solving skills that go beyond functional — or even technology — knowledge. According to Jason, a database whiz that can fly through twenty thousand data cells is certainly valuable, but those sets of skills can be taught.

Jason also points out that this talent will need new approaches — and new skills — to thrive in the current market. Gone are the days where you can save money simply by hammering your suppliers, using reverse auctions when market conditions change, and/or passing your increased costs onto your customers. It’s an open market – the best suppliers will go elsewhere, reverse auctions only work, at most, a few times, and customers expect commodity prices to drop, not increase. Today’s procurement professionals need to be able to hedge commodity prices in the supply chain through exchange traded instruments and aggregate and understand commodity risk exposure across operating units to forward buy commodity contracts for strategic suppliers to ensure rupply and reduce maximum risk exposure.

So where do you find this talent?

One option is to look externally – consultants, contractors, and outsourcers. However, in this case, one of the keys to great results becomes management. In Part III, Jason offers some advice. If you are using an outsourcer, look for one that will balance fixed fee and contingency pricing. If they are willing to take a bit of risk, you know they are confident that they can achieve the expected results.

Be sure to understand market pricing and when it makes sense to pay top dollor. For example, Jason indicates that sometimes it really does make sense to pay thousands of dollars per day – in some cases, above the market – for true experts in targetted processes or specific categories as they amount you pay will pale in comparison to the value and savings they can generate for you. After all, a couple of extra points on a nine figure category is very, very significant.

Furthermore, bigger is not always better. Many boutique consultancies (such as Aptium Global) can bring true expertise and analytical skills – and even top tier academic qualifications – for less than the cost of a “first tier” strategy and operational firms, and with significantly less chance of generalist MBAs with little spend or supply management experience being assigned to your project.

* All posts prior to 2012 were removed in the Spend Matters site refresh in June, 2023.