Category Archives: rants

Today Nintendo Lowers its 2DS Price to Just 99.99 USD

In the ongoing battle to milk every cent out of an obsolescing platform before it’s time comes to an end, today, as per ars technica, Nintendo lowers its 2DS price to 99.99 USD.

Why is this significant? It emphasizes a harsh reality of Sourcing in just about any technology or non-raw material category. Whatever you’re sourcing today, you won’t be sourcing tomorrow, and if you are, chances are the organization won’t be around much longer as sales will dry up, the balance sheet will dip into the red, and bankruptcy will be inevitable.

But should it be this way? In the age of the PC, even though, as Weird Al clearly pointed out in the now classic It’s All About the Pentiums, it was obsolete before you opened the box, it didn’t mean that you had to throw the whole thing out and get a new one to take advantage of advancements. Motherboards had removable processors extra slots and you could throw in or replace cards with math co-processors, better video cards, parallel and serial device interfaces to printers, scanners, and analog signal converters, etc. Now, you knew that eventually you would have to upgrade when a better bus came along or the register size doubled, but even then the new mother boards came with interface slots to the previous generation cards so you could keep using them until you were ready to replace them. You could keep the same case for the better part of decade with smart upgrades.

Now we have slim case laptops where everything is built in and nothing is upgradeable. You have to buy a whole new unit every two years. Not only does this mean Sourcing needs to source a whole new product design at least every six months, but it also has to focus on reclamation. Many modern electronics, especially those that run on cellular or wireless networks, require a significant amount of rare earth minerals and expensive metals that need to be reclaimed due to the limited supply. Plus, in many locales, it’s illegal for a consumer to throw it out, and not only do they need to take the product to a recycling location, but some locales, such as the EU, require the producer to take the product back and appropriately recycle it.

But you know all this, as SI has been ranting about this and the need to design for recycling since the beginning, but, at this point, that’s not enough.

At this point, SI really thinks that all products need to be designed for perpetual upgrade. It should be possible to replace all components of a device as needed as they wear out or need to be upgraded. And it needs to be easier than it was with old desktop computers where you had to open the case, remove a bunch of wires to get to the card/drive/processor, do a precise sequence of presses, twists, and pops to safely get the component out, do the reverse to get it back in, reattach the wires, put the case back on, and then power up and test you don’t cross any wires (while wearing rubber gloves, just in case).

Each component should be a self contained “box” with a standard interface connector, using an upgradeable design that can support the fastest speed the configuration of connected components can effectively support. For example, a copper-based multi-pin connector (which, as demonstrated by Thunderbolt and USB 3.1, can support data transfer rates in excess of 10 Gbit/s) for low-end consumer devices and optimal connections (which, as multiplexing technology, will allow faster and faster transfers in the future) for high-end consumer devices and business devices. Boxes should have multiple smart connectors that can register the type of device they are connected to, and the devices they are connected to (as the components will communicate over an internal high-speed network), allowing the device to be upgraded with new components, and capabilities, not imagined when the initial set of components were first built.

For portability, durability, and weather-proofing, custom enclosure boxes could be built that would hold a standard set of components that would represent a power-house desktop computer or a portable tablet/laptop (where the screen slid out of a sheath and plugged in to the top of the main box and the keyboard folded down).

We may never see this, but imagine how much easier it would be for everyone if the same components could be used for years, investments lasted longer, and Sourcing strategies could be more consistent and predictable.

Just a revelation encased in a rant triggered by a reaction to another price reduction required by planned obsolescence.

Creative or Crackpot. How do you tell the difference?

the doctor has been called both. Thought leaders early in their career, including modern legends in science and business, have been called both. And anyone who pushes the boundaries in unusual ways will be called both. But how do you tell the difference?

It’s a tough problem. There’s such a thin line between genius and insanity, and even if the individual was a genius yesterday, who’s to say the genius hasn’t crossed the line and become a bonafide crackpot today.

But it’s one that should be tackled. the doctor could cross the line himself someday and the best way to prevent that from happening for as long as possible is to be aware of the warning signs and take proactive action. (Just like the best way to avoid dementia is through a combination of good eatin’, regular exercise, stress management, and regular mental activity.)

So the doctor did some research and found a pretty interesting article over on boingboing that provided some advice on the identification of the modern crackpot.

According to the article, written by Maggie Koerth-Baker, the science editor at boingboing and a Nieman-Berkman Fellow at Harvard University from August 2014 to May 2015 (which only accepts candidates with the potential for journalistic excellence), there are five indicators that, if present, might indicate the individual has crossed the line into the realm of the crackpot (or, even worse, has always lived in crackpotopia).

1. Is the story being uttered by the individual too feel-good?
(Like the Big News from Grand Rock.) Good educators care more about the evidence, technology, or practice than the story.

2. Is the proof being presented by the individual too self-evident?
If it really is obvious common sense, the individual is not as smart as he is making herself out to be. And if it’s not, there’s more smooth in the talk than there is substance, and that should set off a lot of warning bells. Proof generally requires explanation. Sometimes lots of it.

3. If the individual is trying to convince you that acceptance of the new idea will make you smarter than the official experts, be suspicious.
Very suspicious. Experts aren’t always right, but they usually are. Plus, at best, you should be as smart as the experts. Not more so.

4. If the studies the individual is using are (really) old, if there’s only a few studies, or if the individual is trying to use some weird meta-study across mostly unrelated studies (and ignore Pinky and the Brain’s lesson in statistics), dig deep. Really, really deep. What looks like truth when you look at five samples can quickly become completely untrue when you look at five hundred.

5. If you are told that you cannot trust any other source of information (because of some big, corporate, conspiracy or because such-and-such expert is a sell-out), then the individual is either the pre-eminent expert or a complete crackpot. (And we will leave it to you to guess which one is considerably more statistically likely.) An individual must know his or her limitations. There’s a reason SI tends to focus on some things (like optimization and analysis) and ignore others (like market speculation and merger benefits). That’s because the doctor is an expert in the first and not an expert in the latter.

This is not a complete or exhaustive test, especially since the greatest of geniuses who truly see the future years before anyone else will often only have a few studies to draw on, come up with proofs so logical that they seem self evident, require you to mistrust most accepted sources of information, and present a story that is truly exceptional. However, ground-breaking advances like this tend to only happen every few decades at most. So the test present by Ms. Koerth-Baker is a good one.

Procurement is Still in the Technology Dark Ages

A recent post over on Deal Architect discussed how, despite claims to the contrary by recent analyst firms, most organizations are still in the technology dark ages, and this goes double for Sourcing and Procurement.

Not only is it the case that most organizations do not have modern e-Sourcing and e-Procurement platforms, but many are still stuck on outdated MRP and ERP systems that actually hinder, instead of help, Supply Management.

Consider the plethora of problems with ERP systems that often make it worse than not having a system at all:

There is generally little requisition management and no sourcing / tender / RFX support. In an ERP the process starts with a purchase order, flips into a goods receipt, and, maybe, just maybe, correlates with an invoice for payment.

There is generally little support for any type of real analysis. There is usually a built-in report library that has a few standard reports on suppliers, products, bills of materials, invoices, and payments.

There is only one schema, and it generally doesn’t lend itself to any particular form of analysis, reporting, or inquiry beyond the built in reports and any sort of global trade analysis, import/export analysis, tax analysis, or tariff analysis is just a pipe dream.

There’s a reason that Sourcing Innovation recently blogged about how hose that still rely on ERP could end up in the supply chain disaster record books and that is because ERP systems are not a supply chain management platform. But it, and maybe a few free web tools, are the best many organizations still have, and that has to change.

Especially when many organizations still pump millions of dollars into these platforms that don’t adequately support Procurement, don’t adequately support Sales, and don’t adequately support modern logistics and inventory management in the age of 3PLs (third party logistics) and VMI (vendor managed inventory).

Investments need to be made in the right products and platforms that serve the core needs of each department, starting with Sourcing and Procurement.  And there are plenty out there.

Sourcing Innovation is all for Rank and Yank in Procurement!

In particular, SI is all for yanking anyone who suggests that the right way to manage talent is to yank out the worst performers in your organization on an annual basis.

This is another prime example of a consulting cock-up from the Big 5/6 who also brought us (often courtesy of the Board of Directors, as per yesterday’s Procurement Damnation post) baseless outsourcing, unnecessary asset liquidation, and the contingent conversion.

While the doctor is all for the reassignment, or, if necessary, the removal of labour that’s not cutting it, arbitrarily hacking the bottom 10% is the dumbest move you can make. Not only does it ruin your reputation (which is why, on Glassdoor, only 62% of current and former employees would recommend Amazon.ca, which employs the rank and yank strategy, as opposed to Google which is recommended by a whopping 92% of current and former employees), but it ruins your future results.

For example, let’s say a new CPO comes in, does a deep performance review across the talent base and removes the non-performers from the organization (either by having them reassigned to another department or retiring them). If everyone who is left is a performer, arbitrarily removing the 10% of the lowest performers in the following year is equivalent to hammering a nail in her coffin with her in it.

To clarify this, let’s say the department has ten employees including three senior buyers, two intermediate buyers, two junior buyers, one full time spend analyst, one full time relationship manager, and one full time contract and compliance manager. If the performance measurement is geared towards identified savings, because the directors are dictating savings, after two years, the relationship and the contract and compliance manager will likely be gone because, doing their jobs properly, they are not identifying savings but ensuring savings identified by the buyers or analyst is realized. In fact, even if each role has its own scorecard, due to the fuzzy nature of what a relationship and compliance manager will due, it’s still quite likely that whoever fills these rolls will rank quite low and be at risk of getting the axe.

But if they don’t get the axe, then, chances are the junior buyers will because the intermediate and senior buyers, who will be more educated and experienced, will able to skew their projects and results to the performance metrics they are measured against. And that’s equivalent to the CPO nailing her coffin while she is in it because, at some point, the senior buyers are going to retire and need to be replaced by the intermediate buyers who will need to be replaced by the junior buyers, who will need a few years to become intermediate — which means that the organization will never see any junior buyers advance. (As it will be cycling a new junior buyer in every year as it cycles one out every year.) As a result, in the long term, the organization will slowly run out of intermediate, and then senior, buyers and results will diminish rapidly — to the point where all employees are equally poor, returns are dismal, and there will be no difference between cutting the bottom 10% and cutting everyone.

Get the picture?

So the next time someone suggests that the organization employ a rank and yank strategy to get better results from its talent, SI strongly recommends that you jump up and say “that’s a great idea, how about we start with you” as you hold open the door!

Authoritative Damnation #63: Board of Directors

Do we even need to say more? The Board of Directors can be your best friend, or your worst enemy. But either way, they’ll probably be your ongoing nightmare.

Their dictates drive your daily duties even more than the wacky whims of the CEO, because their dictates drive the CEO’s and CFO’s dictates, who in turn drive your daily duties. Do you really think the cost savings chant stems from the CFO alone? A good CFO realizes there are 2 big ways to make more money. Increase revenues — which can come from sales or investments — or decrease costs. An even better CFO will realize that you only have to do so much to appease Wall Street and will want to do whatever will increase revenues in the future, because that will increase the stock value, and fatten his nest egg when he sells out and retires (from the company). But if the board chants “savings, savings, savings“, his hands are tied and he will have to do his best country boy jig.

But it doesn’t necessarily end their. We all know that if this was the extent of the damnation caused by the directors, it would barely qualify as a damnation at all. Where do you think the outsourcing craze (and craze is the proper word) came from? The lease versus buy at any cost (because ownership is maintenance and maintenance is supposedly bad) craze. The move to contingent labour (because, apparently, benefits are bad too) craze. Just about any non-sensical craze you can think of usually originates from the wacky whims of a helicopter board member.

But it doesn’t end there. The board is also responsible for forced entry into markets. Forced entry into new product categories. Forced (use-my-buddy-Bill’s-business-or-else) supplier selection. And so on.

Director damnation is it’s own kind of damnation and sweep it under the table we shall not! Especially when this is one of the few damnations on our list that makes the eighth circle!