Monthly Archives: May 2010

Marketing is a Huge Savings Opportunity

Sourcing Innovation’s recent Illumination on Strategic Spend Visibility noted that best-in-class companies that strategically source their marketing spend save an average of 14.7% on five marketing and spend categories compared with a mere 7.8% savings for all other enterprises (as per a recent Aberdeen Group study) and that, across the board, with good visibility, an average marketing organization can easily find 20% to 25% savings with Procurement’s help (as per a recent Ariba report).

Why? Last year’s report from the Marketing Supply Chain Institute on why you need to “Define Where to Streamline” makes it clear. A surprising 62.9% of survey respondents admitted they had never undertaken a comprehensive audit and analysis of costs and process efficiencies in their marketing supply chain. Almost two thirds of companies have never analyzed their costs! (And yet they wonder how most of their supplier reps can afford to drive Beamers, Benzs, and Jags!) Furthermore, only 10.8% are adopting workflow or collaboration systems to reduce costs, only 11.5% have a back-end marketing platform to optimize resources and process, and only 14.2% admit that their marketing is fragmented.

In other words, Marketing is a savings gold mine. Turn your strategic spend analysis system loose and the savings opportunities you discover will be numerous indeed.

Share This on Linked In

The Cloud Is Not a Fluffy Magic Box

It’s just another delivery method for multi-tenant SaaS. That’s it. Nothing more. After reading some recent articles trumping the tenets of the Cloud, and this article in World Trade in particular that asks if “supply chain management [is] emerging from the clouds”, I feel that I need to make this point abundantly clear. Reading this article, I get the feeling that most people think the Cloud is a fluffy magic box that will solve all their problems. It’s not. Nowhere close. It’s just another multi-tenant SaaS delivery model where a third party maintains the data centre that is used by the software / service / solution provider you buy / license / contract your supply chain management solutions from. This allows the vendor to focus on their strengths (software development & delivery) and the third party Cloud provider to focus on their strengths (on-demand data centre).

To help you better understand what the Cloud is, I’m going to point out what it is not using egregious examples from the aforementioned WT article.

  • two aspects to the benefit of cloud computing … the second is … increased visibility across organizational boundariesThis has nothing to do with the delivery model, but who is given access to the platform and how many suppliers and partners buy in to the platform. If you don’t give more of your employees, partners, suppliers, and customers access or if they refuse to use the platform, it doesn’t matter if its Cloud, traditional multi-tenant vendor-hosted SaaS, or ASP.
  • critical information can be analyzed by using cloud-based supply chains to see if cost efficiencies are being realizedThis has nothing to do with the delivery model, but the data and analytics software at your disposal.
  • Cloud-based supply chain solutions give these organizations the ability to quickly scale and compete as the global economy bounces backSo does traditional multi-tenant SaaS.
  • a means to automate many standard processes while managing the exceptions more effectivelyThis is entirely dependent upon the capabilities of the software.
  • a typical cloud supply chain solution already has all of the infrastructure in place … when a client comes to us, we are able to connect them to a rich community of partners almost instantaneouslyThis is true of traditional multi-tenant SaaS vendor platforms that maintain supplier communities, as well as current marketplaces and third-party exchanges. The Cloud just provides a new delivery model for the platforms.
  • cloud-based supply chain solutions can improve competitive advantageThis comes down to the TCO and ROI of the solution and how it stacks up to the TCO and ROI of the other solutions under consideration.

And if this wasn’t bad enough, just before it went offline, Purchasing reached new lows in software’s future breaks through the “clouds” where it called cloud computing a killer app, which shows a complete and utter lack of understanding about what the cloud is. An app is what you run on a platform, it is not the platform. (Of course, it’s still better than calling Twitter a killer app for Purchasing, which they also did. Aargh!)

Don’t get me wrong, I think the Cloud is great because, done right, it maximizes the efficiencies of SaaS and virtualized, on-demand, data centre models. However, it’s not a magical box that will solve all your problems and hyping it like it is does more harm than good because the uninformed will buy in, and then quickly abandon it when they see it does them no more good than their current solution because they didn’t take into account that everything has to fit perfectly — software, platform, solution partners, etc. — in order to realize additional value, and this will often necessitate upgrades to systems and software and processes across the board.

Share This on Linked In

Unnecessarily Overworked? Take the Worth-Your-Time Test and Find Out!

Do you have to get to the office early and stay late every day to get anything done? Do you work 60-80 hour weeks but yet feel like you accomplished nothing? Does work seem like a black hole?

Chances are you’re spending too much time in meetings, in your inbox, and, most importantly, in PowerPoint and Excel … and getting nothing for it. Collaboration is good … when you’re collaborating. But e-mail, spreadsheets, PowerPoints, and meetings where all you do is sit around while someone else takes 50 minutes to present a 50 slide PowerPoint deck that you could read in 5 minutes is not collaboration.

If you’re working 60+ hour weeks but, as far as you’re concerned, getting nothing done, chances are you’re wasting too much time on tasks that are not worth your time, and more importantly, not worth your company’s time. Before you do any task, take Peter Bregman’s Worth-Your-Time test, which consists of three simple questions:

  1. Am I the right person?
  2. Is this the right time?
  3. Do I have enough information?

If you answer “no” to any of these questions, move on to the next “priority” task. While this won’t get rid of all the time wasting activities that fill your day, it will get rid of a significant number, and it’s a great first step to getting your work life back in order.

Share This on Linked In

Successful Strategy Development and Execution: Getting it Right the First Time

As per last week’s series on “What is Strategy? And How is It Obtained?” (parts I, II, III, and IV) and the last two posts on The Secrets to Successful Strategy Execution and Successful Strategy Execution is More Than Lean or Six Sigma, successful strategy development and execution is within the reach of every organization, and there are a number of toolsets that can be brought to bear to streamline development and execution once the basics are understood. However, the real key to avoiding false starts and getting it right the first time is to bring in an external sensei (which, literally translated, means “one who has gone before”) to guide the organization through the process.

Let’s face it, while it is easy in theory to come up with a vision, conduct a gap analysis, create an execution plan, streamline the plan with best practices, acquire the necessary tools and resources, and define the decision rights, information flows, and organization chart that will pull it all together, it can be very challenging in practice — especially if the organization has never done this before. Without a guide, the organization might not even be able to define an appropriate vision. Let’s face it “we will be the most progressive company in our vertical, by providing high quality, customized services to our customers, achieving a measurable difference of success for our suppliers, rewarding the excellence of our employees, and ensuring the long term prosperity of our shareholders“* is not a vision. It is a meaningless collection of buzzwords that’s on par with the drivel created by the Auto Joe-ks Mission Statement Generator that will only result in employees having a good joke at management’s expense as they say “Yeah, right! Who do the nincompoops think they are trying to fool? This is as likely as a monkey flying out of my butt!” After all, it doesn’t pass any of the sniff tests (outlined in part IV). It doesn’t specify what the organization is going to do, where it is going to do it, or why this will help the organization succeed.

Furthermore, it will be hard to conduct a gap analysis if the organization does not know how to define a successful representation of an organizational structure that is aligned to the strategy. Without an expert who knows what an appropriate structure looks like, and how to define the gaps between the current structure and the desired structure, the effort could grind to a halt. Then there is the issue of streamlining the structure, process, and execution plan. This will require someone who understands the core tenets of Lean, Six Sigma, or the foundational Toyota Production System, as well as Business Process Modelling. And the organization will be challenged to select the right tools and resources if the organization doesn’t fundamentally understand what the tools and resources have to do in order to enable the new organizational structure that is required. Plus, the entire effort can break down entirely when it comes to deciding decision rights when mangers mired in traditional mindsets will fight for rights they should never have had and should never, ever, want! And, assuming the organization is able to appropriately divide the decision rights, it might still be stumped on how to define, and enable, the information flows.

That’s why the ultimate key to getting it right the first time is to bring in an experienced guide to lead, moderate, and run the process. An experienced, analytical, and impartial guide will help the organization:

  • focus on constructing a buzzword-free vision that defines the what, where, and why in a manner the employees can truly and whole-heartedly get behind;
  • define a high-level end-state that specifies the who, what, and when;
  • conduct a meaningful gap analysis;
  • develop a process-oriented action plan that will get the organization from its current state to its desired state;
  • select the appropriate methodologies to streamline the processes;
  • identify the right tools and resources to meet the streamlined process needs;
  • categorize the relevant strategic and tactical decisions that will need to be made and assign them to the appropriate personnel (who are affected the most by them and who can generate the most effects from them);
  • streamline the required information flows;
  • create the appropriate organizational chart; and
  • identify the incentives that will have the most impact.

Furthermore, considering that, relatively speaking, consultants are cheap, there’s no reason for an organization not to hire a guide. It just make sense. Why stumble up the mountain when a guide can lead an organizational climber safely to the top?

*So, needless to say, the “leading” Canadian Broadcasting company that decided that it’s vision was to be the most progressive broadcasting company in Canada, by providing high quality, local service to our listeners, achieving a measurable difference for our advertisers, rewarding the excellence of our employees and ensuring long term prosperity of our shareholders wasn’t on the right track … or anywhere close to it!

Share This on Linked In

A Quick Guide to Crisis Management

A recent article in the CPO Agenda on what to do “when the CPO gets a request for quote” had a great guide on what you should to do when responding to a crisis that is worth a quick review. The five simple steps it put forth can mean the difference between a minor disruption and a major crisis. Simply put, these steps are:

  1. Consult the PlansSpecifically, consult the internal response plan and the external communications plan. Then contact the communications team, who should be clearly listed in the communications plan, to update them on the situation, even if their services might not be required (which will be the case if you can catch and fix an issue before the product reaches the customer).
  2. Arm Yourself with the Relevant FactsWhat really happened? When? Where? Why? and How? (Who is irrelevant as you will have to take full responsibility.) Investigate until you have the answers, don’t make any statements based on guesses or unconfirmed information, and don’t be emotional when you make your report.
  3. Don’t Comment Publicly Without Being Briefed FirstIf the products have reached the customer, or if the media has gotten wind of an internal issue and makes an inquiry, don’t respond without first reviewing the communications policy and contacting the communications team, and, if there are any legal implications, the legal team too. Even if you are the most qualified person to respond and have all the information, if you phrase something in a manner that could be misinterpreted, you could put your company in jeopardy.
  4. Assess the Situation for What it Really IsSometimes it will just be a boy crying wolf in your organization when all it is a utonagan. Furthermore, as Rod Clayton of Weber Shandwick notes, you could be in danger of attaching more significance to a situation or comment and making it worse if you can’t apply good judgment on whether it poses a substantial risk or threat.
  5. Takes Steps to Address the IssueWhen something does go wrong, the company needs to take strong, decisive and corrective action, the details of which will of course depend on what the problem is. And if the product has reached the consumer, the action needs to be quickly and clearly communicated to the stakeholders, media, and public. In doing so, the company will need to show leadership in facing up to a challenge and working to solve it. After all, the public will often forgive a company if they feel it has acted well in trying to address the issue.

Share This on Linked In