How Do We Drive Technological Advances? Part I

As SI has repeatedly stated, any organization that wants to excel in Supply Management today needs to master the three base Ts*:

  • Talent
  • Transition, and
  • Technology.

Yes, SI is using talent instead of people and transition instead of process because PPT has been failing us for years. (Which is not surprising considering that death by PowerPoinT is a leading cause of corporate suicide.) Supply Management is not a function where HR can fill a room full of warm bodies and get results. Some organizations still think so (as illustrated by the fact that a few organizations have approached consultancies looking to expand their global supply management organizations by 200 overnight), but it’s not the case. The people need to be talented and that talent needs to be managed.

In addition, Supply Management is not a function where Operations can just take some random processes from a best-in-class competitor and treat them as gospel. The reality is that every organization is different, and every process will need to be customized, or transitioned, to fit the Supply Management organization before any results will be obtained. Similarly, supply chains are fluid and organizations need to adapt to unexpected changes that will continually arise. As a result, the processes will have to be fluid and capable of being transitioned to accommodate new suppliers, distributors, distribution methods, and requirements.

However, the technology element hasn’t changed. The reason — the average organization still hasn’t adopted sufficient modern technology, including most of the must-have solutions SI has identified over the years. (When a recent study by Zycus on The Pulse of Procurement — which would consist largely of companies with e-Sourcing and e-Procurement technology — found that even one quarter didn’t have critical technologies like spend analysis or contract management and 40% didn’t have e-Sourcing or SIM, this is quite telling with regards to the state of modern technology in Procurement.) This is not a good sign when you consider all these technologies have been out there for at least fifteen years and second generation solutions have been available for close to ten years in some categories! It’s true that a few of these technologies were not consumer-level user friendly until a few years ago, but that still shows the burning need for modern technology in an average Supply Management organization today! Not tomorrow! (Because, as The King may have proclaimed in 1971 [when he sang the words of Ernest Tubb], tomorrow never comes, and that’s because you can’t make it through today.)

So what can we do? Certainly a focus on adoption, which includes usability, training, and incentive will help. (SI has authored a great paper on the importance of adoption and how it it is the key to true value. [registration required]) But is that all? Needless to say this conundrum, when first discussed, drew my attention to a now classic article over on Chief Executive on “Seven Strategies for Driving Technological Advances” because any piece of advice that can help spur technology adoption is useful.

Chief Executive had the following pieces of advice:

  • Be a student of technology best practices.
  • Connect weekly with the CIO.
  • Encourage constant learning in the IT Department.
  • Communicate and share best practices through technology.
  • Think benefits, not features.
  • Prepare to invest.
  • Establish meaningful metrics for your CIO and yourself.

So how good is this advice for Supply Management? That will be the subject of SIs next post.

* There are more Ts, but these are the starting three.

This is a revised version of a post that originally ran five years ago, because not much has changed in the average Procurement organization.

Twenty Score and Sixteen Years Ago Today …

… the British East India Company, which would grow in size until it accounted for half of the world’s trade, was chartered. While it hasn’t been in existence for 142 years, it made Britain a trading superpower and with the other East India Companies (Dutch, Portuguese), basically defined global trade for centuries.

The wikipedia article alone is a fascinating read, and links to many more resources for those who want a historical trade understanding.

What do you think LOLCat?

LOLCat, technically, as they were chartered, they weren’t pirates.

LOLCat seems to disagree …

Top Posts of 2016! An Analysis.


Procurement Leaders are Getting Deeper Into Sourcing Strategy

Consider that the 8th and 7th most visited posts are on aligning procurement strategies to business goals. Not only are leading Procurement organizations adopting deeper sourcing strategies, but they are looking to better align those strategies with business goals to extract not just savings, but value. The leaders are realizing, with inflation coming back, the days of savings in a mature Procurement organization are numbered.

Moreover, the fact that the 9th most visited post is on the direct procurement challenge, this indicates that not only are Procurement leaders looking for value, but they are beginning to realize that in order to capture that value, direct procurement has to be done correctly and requires more depth than just a simple auction for office supplies.

Then we have the 4th most visited post being part of the series on how Trade Extensions is redefining sourcing — again indicating that leaders want to do better.


Analytics is Taking Center Stage

The fact that the 6th and 3rd most visited posts of the year are deep dives into not only modern analytic technology, but modern analytic technology that is beginning to apply machine learning in adaptive and useful ways, means that many organizations are not only realizing that they not only need good analytics, but good analytics support.


Supply Chain Finance is On Leader’s Minds

The 2nd most visited post is our post on how the death of factoring will be highly exaggerated. Even though this isn’t really supply chain finance, it’s sold as supply chain finance, and companies that are still relying on it (and trying to figure out how to advance) want to understand what it is, where they are, and how long they have to advance.


Training is Still an Issue …

… even if the budget’s haven’t been restored. The 10th most visited post is on training a procurement team. Leaders recognize that their talent has to be trained to get top results, but with limited budget, they are starting to think about holistic team training vs. individual training.


But Technology is pushing to the forefront.

The 5th most visited post of the year is our rant on how driverless delivery is nothing more than a tantalizing theft target (and how over-investing in automation is not always going to save you money). And the foremost visited post of the year, part of our procurement sustentation series, is our post on IP and Patents. People want to understand technology, the protections around it, and how to tread the issue.

Top Posts of 2016!

Now that we’ve counted down the top posts from the archives, we’re going to count down the top posts of the year, based on direct page-views. (These could be slightly out of order as most posts are accessed by main page accesses, but, as daily visits are fairly consistent, the relative order should not be off two much.) Our expectation is that many of these posts will continue to be read in the years to come as SI posts, which focus on education and not entertainment, truly do stand the test of time (as explained in our previous posts)!

Runner Up:

Give Your Procurement Some Backbone! Part I

10. Training a Procurement Team

09. 5 Reasons Why You Need to Take the Direct Procurement Challenge!

08. Aligning Procurement Strategies to Business Goals, Part I

07. Aligning Procurement Strategies to Business Goals, Part II

06. TAMR – Trying to Tame the Data Deluge!

05. Driverless Delivery? Tantalizing Theft Target!

04. Trade Extensions is Redefining Sourcing, Part IV

03. Spend 360 – Applying Deep Machine Learning to Spend Analysis

02. The Death of Factoring Will Be Highly Exaggerated

01. Technology Sustentation 89: IP Patents

What does all this mean? Come back tomorrow for our analysis.

Top Posts of 2016 … From the Archives … Explained!

Yesterday we counted down the top 20 visited posts from 2016 from the archives, which also contained the top 11 visited posts overall. What does this imply, besides the fact that posts on SI stand the test of time (due to their educational, vs. entertainment, focus)? It means that the desire for Procurement knowledge is increasing, and, more importantly, when you dig in, that a lot of organizations are still struggling with the basics.

Third Party Vendor Reviews Are Important

The 20th most accessed post was vendor day reprise, which centralizes links to the the vast majority of unpaid vendor reviews done by SI. The 8th most accessed post was from the Best Practice Vendor Selection series, and on Part V: Stuck with an ERP? You do have options! in particular. And the 3rd most accessed post is on how BizSlate is Bringing Sexy Back to ERP. In other words, many organizations are still on ERP and trying to figure out how to take it to the next level and how to either migrate from, or, if they are stuck with it, augment their ERP.

A Basic Understanding of Sourcing vs. Procurement is Being Sought

The 12th most accessed post was on Source to Settle – The Sourcing and Procurement Kettle, which follows up SI’s classic post on how it’s Sourcing And Procurement (and advertises a paper and webinar that explains it all). The 13th most accessed post addresses the Difference Between Direct and Indirect and the 11th most accessed post provides a Strategic Sourcing Plan Outline. Then the 9th most accessed post is Smock on Sourcing Strategy, the 5th most accessed post is on Developing Category Strategies, and the 4th most accessed post is on the Evolution of Purchasing. Plus, the 10th most accessed post is on the advantages of decentralization and the 16th most accessed post is on the advantages of multi-tier supply chains, which shows that not only is an understanding of sourcing and procurement being sought, but so is an understanding of how to structure it as well.

The Talent Issue is Still Omnipresent

The 15th most accessed post is on Gen X, Gen Y, and Gen Z and the 7th most accessed post is on the importance of the job description to your talent management strategy.

Risk and Related Areas Are Always Back of Mind

The 18th most visited post in the archives was on Bank Payment Obligations (as lack thereof puts many organizations’ financial supply chains at risk), the 17th most accessed post was on common negotiation ploys used by sales teams (as not knowing them puts a Procurement department at risk of leaving too much money on the table), the 6th most accessed post was on how the purpose of a contract is easy to define (as poor definition creates high risk), and the 2nd most accessed post was on five types of supply risk and how to mitigate them.

There Are Still a Lot of Organizations Beginning Their Procurement Journey

Not only was the top post of 2016 RFX Defined, but it was accessed almost twice as many times as the next most accessed post. (In fact, it was access over 10,000 times!)