Category Archives: Talent

Dangerous Procurement Predictions Part IV

As per our first three posts, if you read my predictions post, you know SI hates predictions posts. It fully despises them because the vast majority of these posts are pure optimistic fantasy and help no one. Why are the posts like this? Because no one wants to hear the sobering reality off of the bat in the new year and the influencers care more about clicks than actually helping you.

But the predictions are not only bad, they’re dangerous if you believe them. So we are continuing to lay bare the reality of the situation to make sure you understand that this year isn’t much different than last year, no miracles are coming, and only hard work and the application of your human intelligence are going to get you anywhere. Today we tackle the next set, and we hope we’re at the end of the series, but if we stumble across more bad predictions, we’ll have to do a Part V. But we hope not!

11. Negotiation gets productized.

Here’s the thing, in a few niche industries like electronics, we have a few niche players like Levadata that bundle “should-cost” + playbooks + concession sequencing for experienced buyers to help them leverage the state of the market for the best results possible. But they’re hardly used relative to the total electronic market size, as they are used mainly by component buyers / manufacturers, not consumers of such tech (to understand the manufacturer’s margins).

Similar offerings don’t exist across most industries. And even if they did, most buyers are not sophisticated enough to do this. Most struggle with a multi-round RFX, yet alone detailed should-cost/target cost models, negotiation playbooks (which have to cover all standard market conditions and unique situations), and the concept of BATNA, especially relative to offers and counter-offers in a structured concession sequence.

Without these domain relevant niche offerings and career negotiations trained in deep tech, which are both few and far between, this is not going to happen. And Artificial Idiocy certainly isn’t going to fill the gap!

12. AI As a “Governance” Engine.

The claim: When you design them well, agents encode judgment, compliance and brand values into every transaction. Uhm, no! At least not if they are Gen-AI agents that can’t judge (as they can’t even reason), may or may not execute compliant with regulations, and will happily screw a supplier (by refusing to pay an invoice) or customer (by refusing to honour a claim) if it thinks that’s what it needs to do to make you happy or stay turned on (because it was told to find savings of 500K and it’s calculations determine that paying certain invoices or honouring certain claims will not allow that savings goal to be met, if it was even possible when the AI told you it was as it may have arbitrarily multiplied a calculation by -1 just to make the math work).

Governance, by definition, requires the act of governing. And governing, by definition, requires the wisdom as well as the authority to conduct the affairs of the organization. And only truly intelligent beings (i.e. HUMANS) can acquire wisdom over time.

13. There will be no more “X” employees because AI will replace them all!

First of all, how many times do we have to repeat that there are NO AI Employees, you shouldn’t believe the degrading, demeaning, and, frankly, dehumanizing claims, and that you definitely DO NOT want Agentic Buying through fake AI Employees. Secondly, it can’t even do the basic tasks that even the dumbest drunken plagiarist intern can do on a daily basis. But let’s not digress too far before giving you the major examples.

Claim #1: Contract Administrator / Staff Attorney

THE PROPHET has been trying to Kill ALL the Lawyers for quite some time now, and it seems he’s not alone.

But here’s the thing. While AI systems are pretty good (and as good as the drunken plagiarist interns) at spotting grammar errors, redlining against standard clauses, pointing out missing clauses in most organizational contracts, etc., they aren’t good at everything. They can’t identify unaddressed risks without being told what those risks are, they can’t judge the full extent of liability without understanding what those liabilities could be, and they can’t judge the supply geo-political and supply chain risks without broader context.

Plus, they can’t always back up their suggestions; often make up case law, case decisions, and authors; and can’t always judge the requirements of potentially relevant regulations. And we’ve seen many times what happens when even trained lawyers use AI — they get lazy, fall for the slop, get reprimanded and fined by judges tired of the laziness (with a recent example happening in November in Mata v. Avianca, Inc). The previous link also lists three other notable cases where lawyers (and their firms) were fined and sanctioned, but, by now, there are dozens!

But hey, go ahead and replace your lawyer, write bad contracts, make decisions on fake case law, and risk your entire business if you want to. (If you want to, it’s probably safe to go ahead and get rid of the intern who does the redlining and the clerk that does the filing, the AI is probably just as good at that, but do not ever, ever replace a real qualified lawyer with a piece of sh!t “AI”.)

Claim #2: Spend Analyst

Sure you can buy auto-classification that might get to 95%, auto-cubing that can build any cube you can imagine, auto-analytics that can run the entire slate of standard analytics and compute past, current, and projected costs against past current, and projected market data based upon current buying patterns and suggest items, categories, and/or suppliers to (re) source, switch from/to, and possibly (re)shape demand.

But this doesn’t mean that it’s the right items or categories to chase, the right suppliers to use, or even the right area to focus your efforts. It’s based on math, and an assumption of consistent, stable, market conditions, but those don’t exist anymore. If you’re not also considering geo-politics, natural disaster risk, uncertain logistics when the panama canal reaches historic lows for much of the year, terrorists block the Red Sea, and unpredictable weather make sailing around the capes more dangerous than other, and sourcing for resiliency and not just cost, your “spend” analytics are useless. You need an analyst with a good understanding of economics (and access to an economist), geo politics (and access to local experts), and resiliency, not just total cost of ownership buying. (Now, the junior data pushers are probably all dead and gone, but not the real experts!)

Claim #3: Sourcing Event Manager

Now, transactional buyers are gonna get replaced by autonomous systems that use next generation (advanced) robotic process automation enhances with machine learning in Agentic systems, because ordering off of contracts, ordering from catalogs, and doing low-cost non-strategic buys through quick-quote RFPs doesn’t take any brainpower whatsoever (making it perfect for AI that has none).

But strategic sourcing requires more than just buying off of contracts, ordering from catalogs, and issuing quick-quote RFPs! It requires defining key criteria (that go beyond what engineering, marketing, or maintenance provides), identifying validated suppliers (or identifying suppliers that can be easily validated), holistically analyzing the market conditions, determining the best event type, determining the negotiation strategy, etc. The tools might be able to help with initial supplier identification, collecting numerical (commodity) market data, letting you know what event types were run in the past, compiling fact-based playbooks, and, of course, automating each extent of the process, but they can’t do real strategic sourcing that requires real human intelligence. And with today’s geo-political uncertainty, that human intelligence is needed more than ever which means that expert sourcing professionals are needed more than ever. (But dumb buyers will join the dodos.)

There are more ridiculous claims, but you get the point. Skilled jobs are not going away. (But bit pushers are.)

14. New standards for Ethical and Sustainable Supply Chains.

In some countries, current standards aren’t even being met. Good luck getting new standards introduced, since there aren’t a lot of global internationals (with those headquartered in the US in particular) that want even more rigour, especially if it will cost money! As long as laws are being minimally met, or reasonably-sized “facilitation payments” can make problems go away, this is not a priority, especially if going beyond would cost more money!

15. The “AI Singularity” is coming faster than we can process.

It’s not, because the models can’t get bigger, there is no more data, and no one has yet come up with a model that has any hope of even getting close to the actual intelligence of a pond snail.

Plus, if it ever did happen, considering a “singularity” is actually a black hole, it would rapidly consume (i.e. destroy) the Earth, and we wouldn’t have to worry about it. This is just more nonsense from the A.S.S.H.O.L.E.

Dangerous Procurement Predictions Part III

As per our first two posts, if you read my predictions post, you know SI hates predictions posts. It fully despises them because the vast majority of these posts are pure optimistic fantasy and help no one. Why are the posts like this? Because no one wants to hear the sobering reality off of the bat in the new year and the influencers care more about clicks than actually helping you.

But the predictions are not only bad, they’re dangerous if you believe them. So we are continuing to lay bare the reality of the situation to make sure you understand that this year isn’t much different than last year, no miracles are coming, and only hard work and the application of your human intelligence are going to get you anywhere. Today we tackle the next three, and while we hope we’re getting close to the end of the series, we’re pretty sure there will be at least one more entry.

8. Global Trade Will Shift, Prioritizing Resilience Over Cost.

In the mid to long term some trade will shift to prioritize resilience, but most trade won’t. While defence procurements, critical mineral and material acquisitions for high-end electronics, and valuable commodities that can be traded like currency (such as gold, silver, platinum, diamonds, etc.) will be shifted for resilience, the reality is that, even with natural disasters, sanctions, trade wars, and actual wars, most companies aren’t going to make any changes to their supply chains (unless given absolutely no choice) because

  • finding new suppliers (in new countries) takes time and effort
  • qualifying new suppliers (in new countries) takes time and effort
  • identifying and contracting reliable carriers takes time and effort
  • building and securing new supply lines takes time and effort
  • etc.

and most companies are in constant fire-fighting mode, overworked, overstressed, and they just don’t have the time as long as the current supply chain, while strained, still works. Until their supply completely dries up, their primary production lines and revenue streams are threatened, and they have no other choice, they won’t change because they’ll keep telling themselves random natural disasters won’t impact them, the tariffs are only temporary, sanctions change with administrations, and wars eventually end.

9. Your employees will orchestrate outcomes.

Woody Woodpecker, take it away!

The level of talent needed to orchestrate outcomes is well beyond the average level of talent in an average (and even most above average) Procurement Department(s). There’s a reason that talent is a concern, a <href=”” target=_blank>top risk, and a top barrier for not just the last five years of studies and surveys, but at least the last ten. Talent has been scarce for a decade, and the situation is much worse since COVID. COVID saw many early retirements of the forced and chosen variety. Then the constant fears of recession saw more layoffs, starting with the highest paid (and most experienced) talent first. And you can be damn sure many of them are not coming back. We told you a year ago that talent is about to become scarce, and we’re sad to say we think we underestimated just how scarce talent is about to become.

And the reality is that only top talent can orchestrate outcomes. All the vast majority of talent can do is execute tasks one by one in a well-defined process. They can’t create new processes, and they certainly can’t define new outcome-centric processes on the fly. Especially when the ORCestration platforms they are given can’t even “orchestrate” a process to lead a mouse to the cheese it desperately wants.

10. New Year, New Me.

Who were you last year?

That’s right, the same person you are this year.

This BS lasts until all the bubbly you drank on New Year’s eve wears off, the rose coloured glasses go dim from the glare of doing the same damn thing as you stare at the same damn screen 12 hours a day, and you get overwhelmed with all the same tasks you were doing last year. Within two weeks at most, the new year, new me bullcr@p disappears with your last new years resolution and you’re just fighting to survive being overworked, understaffed, underfunded, and under-resourced, especially on the tech side (because the C-Suite wasted all the budget on a Big X Consultancy Gen-AI project that never even got to beta testing because the prototype phase never actually worked).

Most people won’t even make an effort to improve, which is the best one can hope for! (So if you have an employee who does, proactively give them a raise, any training they ask for, and keep them. Because, as per our response to the last false, and dangerous, prediction, talent is scarce and you should do whatever you can to keep whatever talent you have [instead of trying to replace it with fake AI that will never work fully autonomously].)

Dangerous Procurement Predictions Part II

As per our first post, if you read my predictions post, you know SI hates predictions posts. It fully despises them because the vast majority of these posts are pure optimistic fantasy and help no one. Why are the posts like this? Because no one wants to hear the sobering reality off of the bat in the new year and the influencers care more about clicks than actually helping you.

But the predictions are not only bad, they’re dangerous. And to make sure you don’t fall for them and make bad decision based on them, we’re going to tackle some of the most dangerous predictions, which include predictions that look innocuous at first glance (like the last prediction on how a big legacy suite will go out of business) but hide the dangerous consequences of what will actually happen if a big suite finds itself in big trouble. Today we tackle the next four, and you can be sure this won’t be the last post in our series. Feeds are still being flooded with prediction posts, and I’m done ignoring the insanity.

4. The jobs market will be tough for the first half of the year, but will start to pick up in Q3 and Q4.

The job market is tied to the economy, and everyone predicts the job market will rebound when the economy picks up. But here’s the thing. Even when the economy picks back up, the job market never does quite as well as the last time. And the economy isn’t going to magically improve half-way through the year. This is the exact same thing we’ve been told the last two years, and it hasn’t happened.

First off, most of the first world economies around the world are flat, borderline recession, or in recession. Secondly, the only thing propping the US economy up right now is AI, and the money circles keeping it afloat as all the AI, Hardware, and Software companies keep moving the same money around investing in each other to keep each other afloat. If the bubble bursts, the US is in trouble, and the economy will quickly flush itself down the toilet. And the job market will go with it.

Considering only the big tech giants who have been hoarding cash for the last few years are in good shape, and everyone else is trying to conserve cash to survive not only the current market but a potential recession, the last thing they are going to do is hire unless absolutely necessary to fill a critical role as a result of a departure. Remember, they’ve spent the last two years using AI as an excuse to lay people off and are always looking for the next excuse to lay people off, not hire them!

Jobs will continue to be super scarce, and only the best will have a chance to land one.

5. We’re in the early stages of a broader pushback (against unnecessary upgrades or technology investments).

A few companies smartening up and saying no to forced big provider upgrades, eight (8) figure consultancy projects, and big Gen-AI investments is not pushback. There have always been a few leaders who have broken away from the pack, did the math, and made the right decisions, but the pack is still charging ahead on Gen-AI. Every big software shop except IBM (who hired a CEO who can actually do math) has invested heavily in Gen-AI, which still loses four dollars for every dollar of revenue, despite any hopes of a real return in the near future and a 94% failure rate.

Let’s face reality. I warned this space about The Vendor In Black nineteen years ago and how he always Comes Back sixteen years ago, no one took heed then, and no one is taking heed now. The business model of the enterprise software space, which has not changed for the two decades I’ve been covering it, is to solve the problem created by the old sh!t by selling the customers the new sh!t that comes with new problems so they can sell even newer sh!t in three years to fix those (and so on). Same old story. Only the vendor names change.

6. We Won’t Buy Things; We’ll Orchestrate Ecosystems.

This prediction likely came straight from the A.S.S.H.O.L.E. and anyone who repeats it should be ashamed of themselves. There are no AI Employees. Claims to the contrary are false and anyone making those demeaning and degrading claims is simply dehumanizing you. And, as we have clearly explained, you definitely don’t want agentic buying because it will happily spend your money not only on stuff you don’t need but stuff that doesn’t exist and, if you’re super unlikely, stuff that is highly illegal. You need wood, it will buy up all the Minecraft wood because it’s cheap and call your problem solved. And that’s if you’re lucky. If you’re not, it will fulfill your resin need with an illegal purchase of hash (the drug) on the dark web (which is labelled resin so the poster can claim they never advertised an illegal drug). And so on.

Plus, as we have already noted, most of today’s “orchestration” platforms in Source-to-Pay are really ORCestration platforms and can barely connect a handful of major Source-to-Pay offerings. They’re nothing close to what is needed to orchestrate ecosystems.

7. Boards will Zero in on Supply Chain Security and Supplier Risk shifts from quarterly PowerPoints to continuous “signalops”.

Just like they won’t invest more in cybersecurity, they won’t invest more in supply chain security until they lose a shipment in the tens of millions. After all, they’ve got supply chain insurance, why should they care? Especially since their current security measures have been sufficient up until now.

But here’s the thing. When the economy goes down, jobs go down. And then two things happen. People get desperate and turn to crime. And criminals, when their investments in drugs, alcohol, gambling, prostitution, and other quasi-legal through illegal activities start losing money because unemployed people run out of money to spend on their vices, these criminals get desperate too — and high value theft becomes more attractive. A temporarily unguarded truck here. A container there. An entire warehouse. And so on.

If it’s critical raw materials they can move (like rare earths), in-demand finished electronics they can sell (like iPhones, where a single container will contain at least 20M worth), military equipment or weapon (component)s that are now in demand globally, they’ll take bigger and bigger chances, especially if there are weaknesses in security. It’s not just cyber attacks that are going to increase, it’s physical attacks, supply chains aren’t ready, and companies won’t even stop preparing them until they lose tens of millions, don’t recover it all through insurance, and risk losing their insurance entirely. No one likes the math of risk prevention because, when it works, you don’t see the return. Even though it’s so much cheaper than insurance! And that’s why, in the majority of organizations, nothing will change.

Primary ProcureTech Concern: Talent Acquisition/Upskilling

Despite the false promises to the contrary, AI will not replace people for critical tasks in the near future and talent will be required.

Why?

This should be no surprise since one of the biggest barriers to success is the talent gap and one of the largest risks is the loss of the critical talent the organization has. As a result, an organization worried about its future should be very concerned about its ability to identify, acquire, and retain top talent.

Impact Potential

The potential impact of being unable to attract and upskill top talent ranges from

  • inefficiency: when unskilled sub-par talent take longer to get work done and do it more poorly
  • inaccuracy: in analysis and resulting decisions along with process and tech selection
  • inability: to manage categories, design new products, mange contracts and commitments
  • inaccessibility: to key suppliers, tenders, markets, channels, etc. if there is no one that knows how to manage them, speak the language, follow the rules, etc.
  • incohesiveness: as a lack of leadership and/or competence causes teams to fall apart

In summary, a lack of capable Talent can cripple an organization!

Major Challenges/Risks

  • lack of skilled talent: in many STEM (related) areas, there is a lack of skilled talent in the market due to lack of graduates, and even a lack of an appropriate student talent pool (as the US is 19th in the OECD rankings for adaptive problem solving and 25th in the OECD ranking for numeracy overall. (See our recent post.) That’s the good news. In the 2022 PISA test, the US ranked 34th out of 81 countries. When it comes to advanced math levels in the student population, some tests put the percentage of US students at a mere 7% compared to 30% of students in Singapore. Even back office jobs which are now analytics focussed and data dependent require advanced numeracy and problem solving skills.
  • lack of experienced candidates: with every recession, market instability, purported technological advancement, etc., companies slash headcount to preserve cash and the first to go are the experienced talent; then, when they hire, they hire cheap inexperienced graduates — with no one left to train them appropriately
  • lack of leadership: leadership requires people who have been there, done that with leadership skills — the more been there, done that that are retired, and the less that are properly trained, the less there are

Final Words

In summary, there’s a lack of talent across the board and you’re competing with everyone else. A talent war is coming, and it’s not one any organization is guaranteed to win.

(Supplier) Diversity is Dead!

Editor’s Note: This is an extended version of a comment that was made in response to an inquiry by THE REVELATOR on LinkedIn about the progression of supplier diversity.

The simple fact of the matter is thus: diversity threatens fascists who want authoritarian dictatorships. This means that as long as far right wing agenda politicians keep getting elected in first world countries (which has been happening more than not over the last decade), not only is DEI (Diversity, Equity, and Inclusion) not going anywhere, but it is going to be rolled back, and done so faster than most policies that came before in countries which equated diversity progress with measurable outcomes.

The sad reality of the situation is that as soon as the board/chief/president of an organization or governmental department concluded that you were not diverse if you did not have x% of whatever minority the board/chief/president thought you should have x% of by time y, and started equating diversity success with measurable outcomes, we went from a situation where “equal opportunity” was replaced with “minority designated role”. And instead of being a further step in the right direction, it was often a step backwards. Under equal opportunity, if two candidates were roughly equal for a role, the role is to go to the minority candidate. And that’s a good thing. However, under “minority designated role”, non-minorities are banned from consideration, and this is not a good thing if there are no qualified minority candidates available for the role. A senior role that should demand a full University degree (Bachelor’s or higher), a decade of experience, and one or more certifications may end up going to someone who just has a 2 year associates degree, only 3 years of work experience (barely relevant to the role), and no certifications as that is the most qualified person who applied.

What many firms fail to take into account when considering diversity mandates is the number of qualified candidates in the minority who are actually in the vicinity of, and who are then actually interested in, and willing to take on, the position. For example, if you were to demand that half of your coding team need to be women, good luck with that when only 25% of STEM graduates in North America are female. (So if you did get 50%, a lot of other companies wouldn’t get any female hires.) Or if you demand that 1/5th of your workforce be hispanic, to mirror the US population distribution, but it’s an in office job in a major city in an expensive neighbourhood where 95% of the local population is white, good luck with that. You might meet your quota, but you know that the vast majority are not going to be qualified for the role.

And DEI didn’t stop there at some organizations and institutions in North America. As soon as people figured out that a DEI program or a particular minority designation could be used to exclude people of certain religion(s) they didn’t like, it went from a tool of inclusion to a tool of subversive discrimination. (So much for equity and inclusion!) Then came the backlash; the labelling of anything even remotely related to DEI, equal opportunity, or humanity as woke; and a full on assault by the fascists and authoritarians.

More specifically, in countries where they have enough power in the government, the authoritarians are dismantling any and all programs they have control over, barring any third party organizations with such policies from doing business with their government, and doing whatever they can to overturn all DEI and Equal Opportunity legislation they can, as far back as they can.

Moreover, given that these far right wing parties are being well funded by donations from the tech bros who spend more time meddling in global politics than running their own ventures, there are not many options for progression of ANY diversity on the global stage.