Category Archives: Technology

The green city of the future

Since we should all be Living Green all the time, it’s time for another post in the green series. Since my last post, it’s been a little quiet on the blogs on the green front, but lots has been happening. On a positive note, a recent article on CNet reports that investments in clean tech have climbed rapidly in the last two years, from less than $300 million in the second quarter of 2004 to more than $840 million in the second quarter of this year.

First of all, I’d like to point out that News.com is following the lead of the Green Thinking bloggers everywhere and devoting special coverage in their special Green Tech section which notes that from solar-powered Wi-Fi to robots fueled by bacteria, researchers are rethinking the way we power our lives.

With articles on Clean Energy, Solar Wi-Fi, and Ethanol BioFuel, you know you can at least clean up the way you operate your business even if you don’t immediately cut costs from your supply chain in the process.

However, one recent article that really caught my attention is the one about the biodegradable forks manufactured by Cereplast. Cereplast’s plastic is composed of organic material and the items made from it will dissolve in a compost pile in 180 days or less. Compare that to regular plastic, which can take 100 years or more. The reality is that we have morphed into a disposable society, and if we aren’t going to change our ways, we should at least make sure we don’t continue to damage the environment with our actions. Moreover, if you can’t save money, you can always make decisions that will make money by designing products that will be perceived as more valuable and sell better in the marketplace, especially when it doesn’t cost you to do so. As the article notes, a pound of Cereplast’s resin sells for around 58 to 60 cents while a pound of petroleum-based polystyrene, meanwhile, sells for around 60 cents.

Another article that caught my attention was the Business 2.0 article that told us “How Australia got hot for solar power”. It seems that Australia is planning to build a 1,600 foot-tall solar tower that can power a small city. More precisely, a 260-foot-diameter cylinder taller than the Sears Tower encircled by a two-mile-diameter transparent canopy at ground level.

About 8 feet tall at the perimeter, the solar collector will gradually slope up to a height of 50 to 60 feet at the tower’s base. Acting as a giant greenhouse, the solar collector will superheat the air with radiation from the sun. Hot air rises, naturally, and the tower will operate as a giant vacuum. As the air is sucked into the tower, it will produce wind to power an array of turbine generators clustered around the structure. The result: enough clean, green electricity to power some 100,000 homes without producing a particle of pollution or a wisp of planet-warming gases. Mix in a few green roofs and some ground heat pumps, and you’re on your way to your perfect pollution free city (as long as the automotive manufacturers step up their clean car initiatives and produce enough hybrid biofuel/electric vehicles to meet the population demand, after all we can build biodiesel boats. (Alternatively, maybe someone will figure out how to scale up hydrogen fuel cells.)

Maybe my fellow blogging thunder from down under will jump in and add his thoughts to the project and the ongoing cross-blog green series (which also includes Supply Excellence and e-Sourcing Forum, on occasion) now that he’s back in the blogsphere.

The Sourcing Innovation Series: Part IX

I’ll have to say that when I started this series, I was going to be thrilled with a few posts and a lukewarm response … but WOW! The uptake has been phenomenal, and it’s not over yet … not by a longshot from what I can tell. It looks like you can expect at least one more guest post this week here on Sourcing Innovation, and maybe even a few posts on a couple of non-spend-and-supply-management specific blogs as well! And the benefit to you, the reader, is priceless – with so many great minds tackling the subject and sharing their views, you can’t help but get a better understanding of the space you’re in, where it is going, and where you need to go. Talk about having one heck of an edge over your web 1.0 technophobic friends! (Maybe we should sick Phil with his mighty spoon upon them! (Sorry Mr. Adams, I couldn’t resist!)

Anyway, back to the point. Charles Dominick’s post on “Sourcing Innovation for Single-Customer Contracts” over on the Purchasing Certification Blog (now the NLPA blog) and Kevin Brook’s post on The Future of Sourcing here on Sourcing Innovation were great!

Kevin got straight to the point – that innovation in sourcing will trend toward doing less rather than doing more. Even though future sourcing tools will contain advanced decision optimization, business process management, default sourcing strategies, next-generation templates, and a dozen technologies we haven’t thought of yet … they will be easier to use than the automatic four-wheeled vehicle you use to get to work everyday. A wheel, a shift, a gas, and a brake. They will let you focus on your job, and your customer, because great service is what makes a great company.

Charles doesn’t waste any time either in pointing out that he sees major changes in how non-traditional categories will be handled in the future. Specifically, he sees migration across a sourcing maturity model, meaning that sourcing of the categories will be handled differently and will require different skills. He then walks us through the sourcing maturity model from Totally Decentralized to Totally Centralized to Center Managed to Center Led where each level requires a different skill set and represents a different step in thinking about sourcing. I have to agree with Charles – although I believe that center led procurement is the way of the future (see my 3-part weekend series over at e-sourcing forum last month “An Introduction”, “A Center of Excellence”, and “Best Practices”), I see the need for a company to progress through the stages, since, as Charles states, If progression is done too fast, a company could jeopardize its competitive position for years. Before a center can lead sourcing, it has to be excellent at what it does. Before it can be excellent at what it does, it has to actually do it .. and bring all relevant purchasing functions into itself. Hence the progression. Note that this does not mean that your purchasing organization has to go through this progression globally, just that every category, and your non-traditional ones in particularly, need to go through this progression locally. Thus, while some of your key categories are center-led, some of your non-strategic low-cost categories might still be decentralized as you work your way through the process category-by-category. As Charles points out, organizations need to learn to walk before they learn to run, and a process will help them get there faster and prevent them from stumbling badly and hurting themselves along the way. ( [Shameless Plug Alert!] And if you need some help, in addition to being able to reach out to me, consulting organizations like the NLPA and Azul Partners [former parent company of Spend Matters] are always there to help! )

RSS

Really Simple Syndication (RSS) is a web feed in XML format used for web syndication, where a web feed is a special kind of web page designed to be read by a “feed reader” which automatically extracts content from a server and delivers it to you in an easily accessible manner when new content is available.

Why is this important? Any decent blog will support standard RSS format that is also supported by any decent reader.* What this means to you is that you, as a user, can subscribe to the blog, just as easy as you would to an e-mail newsletter, or an old-school news group in an old-school newsreader, and have all of the postings from all your favorite blogs ready and waiting for you seconds after you open your favorite feed reader. In other words, if you like Spend Matters, eSourcing Forum, Procurement Central, Supply Excellence, Vendor Management, or Sourcing Innovation, you can subscribe to it and get your content hot off the presses as soon as your favorite bloggers publish it.

There are a large number of RSS readers out there, and you should have no trouble finding one you like. The RSS Info page on blogspace lists over a dozen. Some browsers, such as my browser of choice Opera (since it was everything FireFox is before we had FireFox, even though it wasn’t free until recently), even have a simple RSS reader built in.

Now, if you’re a power reader, you probably know all this. But since a recent CNet blog post indicated that some statistics show that about 90 percent of the public has no idea what RSS is, I thought it be best to be safe than sorry and not only share the simple definition, but also let you know that you can subscribe to these blogs through RSS.

* Note to authors: if your blog does not support RSS, maybe it’s time to upgrade.

The Sourcing Innovation Series: Part VIII

Yesterday, Charles Dominick of NextLevelPurchasing (acquired by Certitrek and now the NLPA) jumped in with an initial post on “Sourcing Innovation for Single-Customer Contracts” on his “Purchasing Certification” Blog (now the NLPA blog) where he offered his insights on the affect of the forthcoming innovation on purchasing professionals and the skill sets required for the future. For more details on the post, and my thoughts on it, check back Sunday.

Today I’d like to welcome Kevin Brooks of Apexon (acquired and merged with Infostretch in 2022) who has been kind enough to provide us with his commentary on the Future of Sourcing. Note that Kevin was also kind enough to provide his insight on “Supplier Performance Management” in response to one of my weekend series over on e-Sourcing Forum [WayBackMachine].

My take on the topic is a bit more abstract. In particular, I suspect that innovation in sourcing will trend toward doing less rather than doing more.

When I look at other industries, I notice that innovation seems to move along a path that makes things easier and simpler for end users even if there is tremendous sophistication under the hood. (Microsoft Windows might be an exception to this rule!) I don’t need McKinsey slide decks to convince me that true strategic sourcing is complex, but the same thing could have once been said about any number of things that are now commonplace. Driving across the country. Getting a knee replacement. Online banking.

I suspect that the tools to enable sourcing will move toward simplifying a complex process, and put the capability in the hands of a much wider group. Sourcing will become a standard business skill set you’d expect from any decent business school graduate. At the same time, more of the responsibility for delivering against expectations will fall on the heads of suppliers themselves, or their proxies (as in the case of contract manufacturing or outsourcing).

Obviously, big strides need to be made in sourcing technology and in clearing the pesky master data management briar patch. And I’m sure there are a few innovative strategies yet to be discovered – Jason’s global capacity marketplace, for example — but they don’t affect the ultimate trend line. In the end, I suspect successful companies will tend to prioritize customer sales and service over internal operations or supply sophistication. Yes, the two are connected, but not in the eyes of most CEOs or even the customers themselves. The less time and effort a company puts into sourcing, the more they put into customers. Ergo, sourcing innovation will trend toward doing less, not more.

Thanks Kevin! I look forward to future guest posts from you!

The Sourcing Innovation Series: Part VII

Yesterday was another busy posting day. David Bush of e-Sourcing Forum [WayBackMachine] posted his thoughts on “The Future of Sourcing?” while Jason Busch of Spend Matters tackled “Sourcing Innovation: Next Generation On-Demand”*. Not long after, Tim Minahan of Supply Excellence [WayBackMachine] jumped back into the fray in response to Jason’s post with “What’s Next According to Busch: Supply Skills Networks”.

David posted his contrarian view based on his observations in sourcing and eSourcing over the last seven years. In addition to noting the emerging desire for decision optimization and complex modeling capabilities in eSourcing platforms, David notes that the future will be forged by process improvement and enhanced corporate understanding of how to use technology since there are fantastic platforms available now that did not exist 10 years ago. After all, especially from the technology side – it’s not done. Once a tool is brought into the process, you will have some functionality that will help immediately but there is a maturation process that vendors and customers alike are going through to find the best fit and features. This is a very fluid process and every release of an application will address more issues but they will never be complete. The software can help any organization with weak areas but this always should be supplemented with personnel improvements and new innovative ideas.

Jason blogged about on-demand, this year’s hot topic (and the subject of my first weekend series over on eSourcing Forum: “The Good”, “The Not-So-Bad”, and “The Coming Pretty”). Jason, who previously blogged that on-demand approaches will embed external content and insight as a fundamental part of their value proposition predicted that the real power of On-Demand will come when providers learn how to leverage the user network as the strategic advantage of the application itself. One early example Jason gives is Open Ratings (acquired by Dun & Bradstreet in 2006) that aggregates supplier financial, operational, and performance data from many sources to better predict supplier financial viability. Jason also notes that while Open Ratings collects, centralizes, and analyzes information, that next generation approaches will probably rely on decentralized information query, retrieval, and analysis and points to the new agent-based search approach of Vinimaya (rebranded Aquiire in 2016 and then acquired by Coupa in 2018) as an example.

Jason also reminds us of his earlier prediction on how next-generation on-demand solutions will enable a new type of decentralized service delivery where an On-Demand platform could enable the creation of virtual shared services teams between organizations based on processes, skills and availability and that this is where he thinks the real value will be. In his view, 99% of first generation (i.e., current approaches) On-Demand models only deliver value through reducing the cost of ownership for member participants of existing types of technology offerings — or customers — rather than offering a new value proposition entirely.

In response to Jason’s claim that an On Demand platform could enable the creation of virtual shared services between organizations based on processes, skills, and availability, Tim notes that considering the talent crunch for skilled commodity and sourcing experts, Jason’s concept is particularly intriguing and well-timed. After all, recent studies from Purchasing Magazine, ISM, and Denali Consulting place talent recruitment and retention among a supply management executive’s top challenges.

But then Tim Minahan suggests another possibility … Jason’s shared-skills concept could also present new opportunities for top-performers to turn supply management into a revenue-generating profit center since some companies are already ’sharing ‘ their sourcing and category expertise and operational procurement capacity and systems infrastructures as part of new for-fee procurement outsourcing offerings, such as IBM. If this becomes a very profitable offering, then we probably will see Jason’s next-generation on-demand platforms sooner rather than later.

Since these pieces are very well written, and since I do not have anything to add as-is, I’m not going to elaborate on them but instead will ask what would happen if we try to merge them into one prediction? A first attempt tells us that it will be a process-oriented future driven by next-generation on-demand technology that will make critical information more accessible and usable for tomorrow’s knowledge workers, but what does that mean? As I pointed out in “The Coming Pretty”, I think the answer is that next-generation on-demand will be based on enhanced business process management (BPM) that will allow for workflow applications that can be customized on-the-fly to incorporate modified processes and workflows that not only allow for the construction of more versatile and configurable applications than before, but also allow trained business users to define their own workflows through a visual environment. In other words, platforms that evolve with your processes!

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