Category Archives: Technology

State of Flux Has the Treatment for Your SRM Ailments: Part VII The SRM Platform Continued

As per our last post, so far in this series we have discussed the need for SRM (Part I), Chicago and a foundation for your SRM effort (Part II), tips and tricks for foundational success (Part III), the importance of good supplier relationships and State of Flux’s latest research report The Business of Supplier Relationships (Part IV), the six pillars of supplier relationships and their importance (Part V), and a review of the coverage of the State of Flux Statess SRM platform to date (Part VI), known as Statess.

The State of Flux platform has been under heavy, active development since our coverage early this year and considerable progress has been made on four fronts:

  • Prospective Suppliers
  • Accreditation and Compliance Tracking
  • Contract Management Enhancements
  • KPI Templates and Dynamic Drillable Scorecards

Prospective Suppliers

State of Flux has been actively developing a supplier self-registration system that allows a supplier to go through a dynamic question-based workflow-driven system that captures all of the information required for the supplier management team to verify, and qualify, a supplier for organization RFXs and innovation challenges. Depending on the industry, geography, and products or services being offered by the supplier, the amount of information required can vary from a few pages to a few dozen pages and the questions required may or may not need to cover environmental, ethical, financial, corruption, sustainability, or related areas of corporate social responsibility and the depth will depend on where the supplier is, what products the supplier is offering, where the products will be sold, and who the supplier is dealing with.

Accreditation and Compliance Tracking

State of Flux has been actively extending their ability to track and manage accreditations, compliance requirements, and compliance incidents. In addition to supporting detailed tracking down to a component level if need be, the system also supports integration with Sedex Global and Ecovadis which contain detailed sustainability and compliance audit data for tens of thousands of suppliers. This makes sustainability and compliance tracking a breeze.

Contract Management Enhancements

State of Flux has also considerably enhanced their contract management solution which can not only store all contracts associated with a supplier, but all historical versions and be used as the system of record during and after contract negotiations. It tracks extensive meta-data, which can be defined by the organization upon implementation, and makes it really easy to identify relevant contracts, track milestones and deliverables, detect termination and auto-renew dates, and tie contracts to KPIs, innovation efforts, and related projects. It is so powerful that a number of their Global 3000 clients are abandoning their e-Sourcing and e-Procurement CLM solutions in favour of the State of Flux solution because a contract is only as good as its execution, and execution has to be managed for success.

KPI Templates and Dynamic Drillable Scorecards

In the brand new release, available now, State of Flux has considerably enhanced the performance module that (now) supports the definition of KPIs, and templates, that can be applied across the supply base, defined down 4 levels, and used in dynamically created drill-down scorecards that show the user exactly what she wants to see with respect to a product line, geography, and/or supplier. In addition, the platform now comes with a number of pre-defined templates for standard KPIs across different performance categories that will make initial scorecard definition easy for the average organization. The user can also define when KPIs and scorecards should be automatically updated and create a dashboard with key (roll-up) scorecards that the user needs to track on a daily basis.

The user interface for Statess has been enhanced and usability is very straightforward. Plus, State of Flux is planning to attack the Master Data Management issue in 2016 and make it easy for an organization to also use the solution as a Supplier MDM tool since it is capable of tracking, and integrating, all supplier related information. It’s really just a formal definition, open schema, and API away from meeting this need.

State of Flux Has the Treatment for Your SRM Ailments: Part VI The SRM Platform

So far in this series we have discussed the need for SRM (Part I), Chicago and a foundation for your SRM effort (Part II), tips and tricks for foundational success (Part III), the importance of good supplier relationships and State of Flux‘s latest research report The Business of Supplier Relationships (Part IV), and the six pillars of supplier relationships and their importance (Part V). While all of this is important, it only discusses part of the treatment — the process part. As has been indicated, another part is also needed — the platform part.

In addition to offering a foundation for SRM and a process, State of Flux also offers a platform, which was recently renamed Statess and covered in our 3-part series on stabilizing your State of Flux earlier this year (Part I, Part II, and Part III).

The State of Flux Statess platform is a modular, flexible, and adaptable platform that is designed to meet your:

  • relationship management,
  • risk management,
  • performance management,
  • contract management,
  • innovation management,
  • sustainability & CSR,
  • benefits management,
  • category management,
  • intelligence, and
  • programme management needs.

The platform, which was designed to be easily configurable to provide the organization and the supplier with a 360-degree view from the buyer and supplier homepages, allows the buyer to create customized scorecards and reports using configurable widgets that can access data in any part of the implemented system. Moreover, should third party data feeds be enabled (through third party plug-ins), the buyer can also access trading information related to the supplier and its products, related news feeds, and third party intelligence on the supplier.

This third party data can be used to augment the very extensive supplier profiles the system allows you to maintain. Good SRM requires good SPM (Supplier Performance Management) which in turn requires good SIM (Supplier Information Management), so it should come as no surprise that the State of Flux platform is a first rate information management platform. These extensive profiles include information on the supplier’s organizational structure as well as extensive governance information that includes the individuals responsible for the relationship on both sides.

Furthermore, information collection is quite easy as the platform supports a very powerful generic survey mechanism that, like a good RFI solution, allows multiple types of surveys to be built with multiple sections, different response types (checkbox, numeric fields, free text, etc.) for each question, and automatic weighting mechanisms. This allows the organization to prepare the appropriate internal performance surveys and external 360-degree surveys that form the basis of good performance, CSR, Risk, and Relationship management programs.

Our third post in our series briefly covered the contract management, performance management, risk tracking, and innovation modules as well as the programme module which manages the projects. Each project can be associated with a business unit, one or more contracts or bids, zero or more other modules or initiatives in the platform (including performance management, risk management, and innovation), and can consist of one or more stages or tasks defined in accordance with well understand project management methodology.

And, as per our last post on the subject matter, the platform, while quite extensive, is still under active development. In our next post, we’ll discuss a few of the new features of the State of Flux Statess platform as well as some key features not addressed in our previous series.

Technological Damnation 86: Template Mania

We’ll admit that compared to the rest of the technological damnations, and damnations like Cybersecurity / Cyberattack (76), The Cloud (80), and Dashboards (84) in particular, just to name a few, this particular damnation isn’t that bad [and it’s certainly no Big Data (79) or Spreadsheet (83)]. But it’s bad enough to make our list. Why? Let’s get to it.

But first, what is a template? Well, that depends. Wikipedia has over a dozen definitions for templates, including:

  • a pre-developed page layout in electronic or paper media used to make new pages with a similar design, pattern, or style;
  • a standardized non-executable file type used by computer software as a pre-formatted example on which to base other files, especially documents; and
  • a master page on which you can globally edit and format graphic elements and text common to each page of a document.

However none of these definitions really clarify what a template is. So let’s consider a few of the templates we use in Supply Management.

  • RFX templates to quick start sourcing projects for common or previously sourced categories
  • Strategic Souring Decision Optimization templates for pre-defining models
  • Data collection templates for analyzing surveys using BI tools
  • Scorecard templates for supplier performance monitoring
  • Workflow templates for setting up a sourcing project
  • Workflow templates for (automatically) approving invoices

And right now you’re probably even more confused. And that’s the point.

Extreme template proliferation makes it hard to even identify what a template is.

Is it a form? It is a form generator? Is it a workflow that powers a form generator to create a form custom for your sourcing project? Is it copyable, or just configurable? Is it specific to you, your project, your organization, and/or your platform? Can it be altered by you, by an administrator, or just a vendor rep? The questions are dizzying. And we still haven’t addressed the fact that …

Even if we can define what a template is, it’s hard to know when it could be used.

Take a quick-start sourcing template for mobile electronics. If it was designed for cell phones, can it be used as-is for smart phones or does it need minor edits. What about tablets. And what about those damn unclassifiable phablets. Aaarrrggghhh!

With so many options for each situation, it’s almost impossible to know which one is best.

If the templates can be copied and altered, there might be the vendor template, the modified template from the Center of Excellence, the modified modified template from the last Sourcing project created by the previous buyer, a modified vendor template from another region created by yet another buyer, a third party template in the customer network on the vendor’s site, and so on. Which one is best? Are any appropriate? At this point you just want to bang your head against the brick walls.

And how do we keep them all up to date?

This is the real damnation. Not only do we have to keep a never ending deluge of data up to date, but we have to now keep a never ending deluge of templates that may or may not be used to capture the never ending deluge of data up to date. Ack!


Data, data everywhere
and all the tables burst
Data, data everywhere
we thought it’d get no worse

Technological Damnation 93: Technological Disasters

When we covered Environmental Damnation 18: Natural Disasters, we noted that natural disasters — including earthquakes, volcanic eruptions, and tsunamis — are on the rise. However, these aren’t the only disasters that can bring your supply chain to ruin. Man made disasters stemming from technological advances can also disrupt, and sometimes destroy, an entire supply chain (region).

Three major disasters we need to be on the lookout for are:

  • Nuclear Meltdowns

    While the proponents might like to sell us on how clean nuclear energy is compared to petro-carbon alternatives, the fact of the matter is that while the energy is clean, the waste is much dirtier, with Plutonium-239 having a half-life of 24 Thousand years and Neptunium-237 has a half-life of 2 Million years! Plus, while an explosion at a petro-carbon energy plant might wipe out the plant and immediate surrounding area, an explosion at a nuclear power plant can make an entire city, or even a small state, uninhabitable for millennia! For example, the 30 km exclusion zone surrounding Chernobyl will not be safe for human life for another 20,000 years (and even today, 30 years later when [over] half of the iodine-131, caesium-134, caesium-137, and strontium-90 — the four most harmful radionuclides that spread as a result of the explosion — have reached their half-life, workers are not allowed to work in the zone for more than 5 hours a day and not for more than one month at a stretch due to the ongoing risk to one’s life).

  • Chemical Leaks

    Most of the chemicals we use in manufacturing and production need to be transported, and most are transported by tanker truck or rail car (or pipeline between plant locations), but some are transported by barrels, especially when being shipped by sea (or air). Leaks can be dangerous if the chemical is explosive, acidic, or poisonous, especially if the leak is near a populated area or a water supply. For example, the Bhopal disaster of 1984 exposed over 500,000 people to methyl isocyanate (a toxin often used in pesticides such as Carbaryl which are designed to kill bugs hardier than us, and banned in many countries) and resulted in 3,787 confirmed deaths, 3,900 severe and permanent injuries, and 558,125 reported injuries.

  • (Natural) Gas Leaks

    Gas leaks, whether chemical or hydrocarbon, are among the most dangerous leaks, and natural gas leaks are among the most dangerous. Not only are they toxic (as we are talking about a mixture of methane, carbon dioxide, nitrogen, etc.), but they are also highly explosive, requiring only a single spark to (potentially) obliterate an area the size of (multiple) city blocks. Recent examples are the 2012 explosion in Springfield Massachusetts that destroyed 2 buildings and damaged 42 and the 1992 explosion in Guadalajara that killed over 200, injured 500, and left 15,000 people homeless.

The more we progress, the more we need more, and, stronger energy sources and more chemicals to produce our new technology, and the more danger we place ourselves, and our supply chains, in.

This necessitates the need for more safety audits, more safety practices, and more oversight — especially as more regulations start popping up to try and prevent more accidents and control dangerous substances. So not only do you have to worry about the well being of people in your supply chain, you have to worry about the well-being of your brand if you fail to maintain top safety practices, go afoul of regulations, or take your time switching away from dangerous chemicals or energy sources to more environmentally friendly sources.

This damnation always needs to be at the back of one’s mind or when it unexpectedly rears its ugly head, one will not be ready.

There is no ONE platform!

As much as we would like to realize the dream of one platform for Supply Management, it’s not going to happen — at least not within our professional lifetime. The internet, and software development, might be moving in cat years, but let’s face it, it’s been 90 cat years since true first generation strategic sourcing, e-Procurement, and other fledgling Supply Management products hit the scene and we still don’t have a single end-to-end strategic source to pay platform! (Yes, there are source-to-pay platforms, and some are rather good, but there is not one that is not missing some key piece of functionality for strategic sourcing, such as optimization or advanced analytics, or for e-Procurement, such as e-Invoicing and automated m-way match.)

But what can we expect, with the exception of a handful of organizations (that can be counted on your fingers, minus your thumbs), we haven’t even reached the era of one ERP. Larry had a dream, but outside of Oracle, I believe the number of global organizations that successfully migrated their international operations to one global (Oracle) ERP instance is 5 (and that’s why the vision of one platform went away and Oracle acquired so many other leading ERP platforms, leaving only its rival SAP standing at the end of the day once the acquisitions on both side are tallied up.)

We have the situation that no one vendor, and this includes SAP, Oracle, and IBM even after their string of acquisitions over the last 90 cat years, has a platform that fully addresses basic Sourcing, Procurement, and Logistics, and once you start factoring in CLM, SRM, Sustainability, Talent Management, and Innovation Management needs, nothing comes close, or will come close, for at least another 60 cat years at the current development pace. In addition, with the constant pace of innovation in terms of process, and the constant shift both towards globalization and specialization, nothing may ever come close.

Sauron may have forged the one ring, but not even the almighty Google will forge the one platform. So you have to stop focussing on finding the right vendor and shift to finding the right platforms to serve your Supply Management needs. To do this, you have to first ask, what is the workflow?

Even though the organization may have different processes and procedures for T&E, P-Card, indirect, and direct purchases, depending on category, department, amount, and budget owner, there is still one (mega) process that is followed.

There will be a needs identification followed by an identification of whether or not an inventory, contract or preferred vendor exists to fill that needed followed by a determination of whether an event is needed or not, followed by the determination if a requisition is needed, followed by an order (which may or may not require a purchase order) followed by goods delivery and an invoice, followed by acknowledgement and inventory, followed by determination of an approval process, followed by an approval process for the invoice, followed by a payment, followed by data capture and archival in the right systems. There is a mega-flowchart that defines the mega-workflow that is defined by everything the organization needs to directly and indirectly support the process that defines system needs and integration needs.

The answer is to identify one or more minimal set of overlapping platforms that fulfill the workflow needs, integrate with the underlying ERP and / or (Master) Data Management (MDM) systems, and, directly or indirectly (through the underlying systems) integrate with each other. Once these system sets are identified, one works with the vendors that best meet the organization’s overall needs and implement the systems that accomplish the workflow. That’s how progress is made. Nothing is gained by seeking out the one platform. It is a myth, and a myth that destroys organizational progress and productivity.