Will Millennials Kill The Email?

Will Millennials kill email?

Millennials on the whole are not fans of email and the formal style it dictates – instead they prefer instant communication platforms such as WhatsApp and Facebook chat, which they have grown up with. However, the challenge this poses for the workplace is whether the social behaviours and technological preferences of Millennials can be incorporated into a business to promote greater collaboration and engagement. With a number of new technologies continuously entering the market, the question is whether and how these new platforms can replace the email? And equally as important is if they should?

Just because a technology works in a social environment does not mean that it will successfully transfer over into the professional sphere. Instant, open communications may be the preferred method for Millennials, but businesses need to consider which tools are best suited to achieve their wider goals.

For some companies, this could well be email due to its established compliance, auditability and control benefits. For firms seeking more free flowing communications, social tools like Yammer and Slack may be more effective. In either case, the first step is to identify the company’s objectives and then implement a solution that meets these.

Businesses want order, not chaos

For most companies, regardless of how flat their organisational structures are, there remains some form of hierarchy that has senior managers monitoring and driving the performance of staff. Where email brings structure, the open nature of social messaging platforms often brings an element of chaos, with message threads becoming long unwieldy streams of unverified “chit chat”, making compliance and measurement very difficult.

There are many examples of SMEs and small teams of up to 50 people using instant messaging and social networks to share information successfully. This is because the small number of users makes this form of communication manageable. Larger businesses, on the other hand, are still communicating in the same way as they did in the 1990s; with email.

Consequently, two key elements of the daily work cycle remain disconnected from each other: the electronic communication between staff and the work output itself. For a typical piece of work to be produced, employees may have an email exchange before deciding upon a course of action, but then switch from email to a file-based working environment to edit a Word, PowerPoint or Excel document, before again returning to email in order to send the completed document for review. This is clearly a tedious process appreciated by few.

Millennials are used to a ‘followable’ environment with seamless, real-time information sharing in their social lives – so why would they want to email their colleagues with a link to a file every time they make a change? If this activity could be carried out directly in a collaborative environment, teams could synchronously work together, removing the version control issues and delays that leave Millennials feeling frustrated.

Communication must lead to work

Business communication is a means to an end, not an end in itself. There is a growing desire amongst business users for improved integration between day-to-day communication and the processes that are needed to get the work done. Getting the work done is the key point – not just talking, but actually producing something.

There is an expanding market of applications available for this purpose, from message aggregators like Slack to social document authoring tools like Quip or GoogleDocs. Millennials are increasingly trying to patchwork together a better, more social way of working that is not entirely dictated by email.

This patchwork quilt remains the preserve of the individual and the SME workplace, however. Even Slack’s high profile growth and media awareness has not established it as a pervasive way of communicating in the enterprise. The same was true of Yammer five years ago, despite being the self proclaimed “Enterprise Social Network”.

What needs to be asked is why these communication platforms are not taking hold in the enterprise. Are email and attachments persisting because work continues to be authored off-line? If so, we need a new way of working, addressing the root cause of off line working, to move forward.

The current situation

Quip is a simple social authoring tool, and its multi-platform, lightweight user interface is certainly easy and quick to adopt. But could an entire enterprise use it instead of Microsoft Office? No. And that is not its intention. GoogleDocs has been adopted by some enterprises, and with its Office style tool set, it offers enough familiarity for workers to perhaps abandon Office. However, workers still end up following their behaviour from before, only now using Gmail instead of Outlook to communicate around the files they have authored.

As an industry, venture-backed start-ups need to focus on taking the time for deep thinking, complex design and substantial build out, not speed to market or speed of growth. Until such a rigorous approach to enterprise software development is taken, Millennials will not be able to drive the change they desire and replace email with a form of communication and style of work that best suits their desires and abilities – at least not entirely.

Written by Tristan Rogers, CEO – Concrete.

Concrete is a global enterprise collaboration platform used by brands including Vans, J Crew, Gap, Kate Spade, Williams Sonoma and Marks & Spencer.

Enjoyed this article? Sign-up to Procurious for FREE and join 6000+ other professionals.

Trust, Shame and Reputations – Truth & Lies in Accounts Payable

It’s comforting to think that if fraud exists, it exists elsewhere – anywhere in fact other than right now – in your organisation and your own department.

Truth and lies in accounts payable

Thanks to APN for granting Procurious permission to republish this article

In fact, it’s that assumption which makes life a whole lot easier for those hoping to embark on a life of Accounts Payable (AP) crime.

Of course, no-one likes to think that someone they work with could be capable of fraud, and yet the truth is – fraud happens – and it happens quite a lot. And you’re not looking for a shady character in a badly judged mac with dodgy eyebrows. Statistically it’s likely to be “John” who’s worked for the company for the last 15 years. Perhaps “John” feels entitled after all the unrecognised hard work he’s put in. Perhaps it’s his way of righting a long standing wrong. Who knows.. but most of all – John is doing it because he can.

Of the many high profile fraud cases of recent months – they have all carried some element of shock – the trusted Head of Lloyds Fraud and Security for example, or the Manager of the Birmingham Dental practice involved in a £1.4m invoice fraud. Both were trusted employees with considerable access to the financial systems and the knowledge of how to navigate around them to their own advantage.

So we know that an excess of trust plays into the hands of fraudsters – but in some cases there’s another set of human emotions at play too – shame, embarrassment and perhaps corporate ego, or pride.  Back in the early 2000s, I had some involvement with a large (and to remain nameless) organisation who fell victim to a series of “threshold frauds” (those where the invoices sat just within the threshold for approval).

Percentage wise, the amounts were tiny – but after two years – the scheme had netted the perpetrator a considerable fee. And although the employee was “asked to leave”, the matter was not taken further – in a damage limitation exercise for the reputation of the organisation. So instead of serving as a warning to others, the fraudulent activity was swept under the carpet.

As it’s unlikely (and not particularly desirable) that we collectively decide not to trust our employees and fellow colleagues – it makes sense to adopt practices and technologies which can allow us to indulge our natural instincts while keeping appropriate checks in place. Most of the time people conducting fraud are simply taking an opportunity – it’s not necessarily a lifestyle choice and they’re not necessarily experts at hiding their actions.

For example, many fraudsters are caught because when something works once, they’ll try it again and again until they forget to be cautious. Implementing a series of automation solutions can provide many of the answers, but only if it’s placed at the centre of a tight set of thoroughly examined procedures.

Of course, a tightening of processes within accounts payable can have significant effects on areas other than just controlling fraud. If payments are being analysed for duplicates and master supplier files are being checked for erroneous entries and the AP manager has a new step by step process to follow from receipt of PO through to payment, analysing a series of pre-determined metrics along the way – then the cost per invoice goes down and the savings go up. All of which is good news for the business and great news for the reputation of the AP department.

Twelve Warning Signs to Look Out For

  • Invoices from various suppliers on similar stationary
  • Suppliers with incorrect VAT numbers
  • Transactions which are out of the ordinary – ie late at night
  • Excessive voids or credits in the receivables ledger
  • Large number of invoices, especially to a particular supplier, just beneath the approvals threshold
  • Few, or unclear reasons for a particular service
  • Suppliers with PO Box addresses, home addresses etc
  • Erratic employee behaviour – always in early or late
  • Sudden, or unexplained employee departure
  • An increase in duplicate payments
  • Excessive amounts of rounded up, or down invoice amounts (frequently ending in 5 or 0)
  • Above average payments to a supplier

 “Fraud and falsehood only dread examination. Truth invites it.” Samuel Johnson.

Accounts Payable News® (APN) is a trusted information base with direct access to 14,000 key decision makers in the finance sector across a variety of different industries. 

‘I Look Like An Engineer’… Machismo In The Workplace

As the dust settles around the #ilooklikeanengineer outcry, a poll reveals that macho behaviour, patronising colleagues and safety fears are putting women off working in male-dominated industries.

ilooklikeanengineer

If you’ve been on social media within the last 48 hours you may have noticed #ilooklikeanengineer trending. The trending topic is the result of the sexist reaction a female engineer received after appearing in a job ad for OneLogic.

By way of a follow-up, research conducted by foul weather clothing manufacturer Stormline reveals that a ‘macho’ atmosphere is the characteristic most likely to put a woman off a job in a traditionally male orientated industry. 

The research polled over 1000 women and found that it is the work environment – not the work itself – that has the biggest influence the attractiveness of a job. Pay levels, wording on job adverts and being asked to carry out boring work were found to be less off-putting.

A poll from February 2015 identified the ten industries perceived as most ‘manly’ among UK adults.

Poll about the 'macho' workplace

A separate poll of 1019 women conducted in April 2015 measured attitudes towards jobs in those industries by asking participants to identify the most off-putting characteristic of each industry.

Genevieve Kurilec is a commercial fishing captain and runs the Chix Who Fish Facebook group and website. She believes women are a balancing presence in dangerous, macho environments. “In my experience women tend to be more safety conscious and detail oriented, which makes us an excellent asset to any crew working in a dangerous occupation.

Genevieve says: “There will always be men in society who are patronizing towards women. The camaraderie found in the majority of the commercial fishing industry far outweighs the petty few who do not recognise the capabilities of women employed in marine occupations. If you do your job, put in your time and take care of your vessel you will earn the respect of your fellow fishermen, gender notwithstanding.”

Caroline Livesey is a geotechnical design consultant and often works on engineering projects in male-dominated environments. She believes attitudes to women’s work in general create barriers to participation in the workplace, stating: “I think societal bias tends to pigeonhole women and men into specific roles. The knock on impact of this is that both genders are inclined to assume women cannot make good engineers as it is not a role that we naturally see them in.

“The downside of this is that women continue to have to break down those barriers in order to progress in this industry. On a day-to-day basis for females in civil engineering is that they have to work far harder than their male counterparts to earn respect, to progress, and to be trusted technically.”

Enjoyed this article? Sign-up to Procurious for FREE and join 6000+ other professionals.

6 Sure-Fire Ways To Become A CPO

6 Sure-Fire Ways To Become A CPO

I have worked in Procurement for twenty years now (a scary thought). During that time, I have had the immense pleasure of watching a number of trailblazing procurement professionals ascend through the ranks of their companies to take the coveted position of CPO (Chief Procurement Officer).

If your professional goal is to become a CPO, there are some very simple tips I can share for how to successfully climb the career ladder leading to the ivory towers of procurement. 

  1. Build your trophy cabinet

“Make sure you have successes you can point to,” is one of the best pieces of career advice I have ever received. You need to be able to clearly and convincingly explain projects that you have personally been accountable for and how they have delivered value. Your successfully completed projects with defined benefits are your career trophies.

Put another way – to get promoted, you first need to excel in the job you have today. Ok, this seems rather elementary, but I hear from CPOs around the world that many category managers today are so focussed on where they want to be tomorrow, that they aren’t delivering on the job they are meant to be doing today!

I cannot emphasise how important the basics of professionalism are for making positive impressions on those who will promote you. Do your homework before every meeting, be on time, have an agenda, be well presented, be composed, write and distribute notes following the meeting and, most importantly, do what you said you would do and notify everyone that you have done what you said.

I can’t stress these last two points enough.

Doing what you say you will do and confirming that you have done it may be the two biggest contributors to people getting promoted. Leaders like to have people working for them who actually get things done. Leaders also need to know that the job has been completed. It’s not enough just to do what you said you would do. You need to make sure everyone knows you’ve done it, so they can get it off their to-do-list and put a mental tick beside your name as someone who delivers. 

  1. Don’t burn your bridges… EVER

No matter how old or experienced you are, if you are ambitious, you will find yourself getting frustrated. This will come in many forms. You’ll get frustrated with the lack of progress on projects; you’ll get agitated with certain decisions and actions, and you most likely get frustrated with the people who work below you, beside you and above you. It’s understandable.

In these stressful situations it is often difficult to contain yourself and maintain harmonious, productive relationships with those around you.

But it is critically important that you do.

As I shared in my blog How to Quit your Job with Style, everyone you work with, whether they are inside or outside you organisation, are invaluable long-term supporters of you and your career. As you progress up the ladder (or across your portfolio career!), you will be amazed how every person you have worked with plays a role in helping “buoy” your promotion. You need as many people as you can to endorse your capability and to recommend you for promotion. Getting ahead is hard enough – you certainly don’t need any detractors.

With this is mind, it’s clear that an invaluable skill for future leaders to develop is patience. Great leaders have an uncanny ability to pick the right time to hold back and when to push. As America’s founding father, Benjamin Franklin once said, “He that can have patience can have what he will.”

  1. Be squeaky clean – a beacon of integrity

When The Faculty developed its X Factor assessment for future CPOs, it became obvious that a key differentiator for our profession was its role in clarifying the ethical “true north” for our organisations. Procurement’s competitive advantage is that it can provide rock solid guidance on the most ethical commercial processes and decisions our businesses are involved in. Few other functions can boast these credentials.

As sustainable sourcing and the ethical responsibility of our businesses continues to draw an increased (and warranted!) interest, future procurement leaders must have an unblemished track record in conducting business and leading teams with the greatest integrity.

One of my favourite sayings is, “Know you’re right, rather than hope you’re not wrong”. With this mantra in mind, I would suggest you and your team complete the CIPS Ethical Procurement and Supply Course. Completing this e-learning program will help identify areas of ethical and social risk and will suggest how to best respond to these situations. It just might save you from a crisis. 

  1. Raise your voice, raise your profile

If you want to be promoted you first need to be noticed. As we all know, this is easier said than done. To be viewed as a leader today, you need to be seen as an influencer… someone with something to say… someone with a unique and informed opinion.

Future leaders need to constantly nurture and nourish their personal brand. In order to succeed, you need to position yourself for success. Often, this will mean stepping out of your comfort zone. Holding knowledge sharing events in your office, speaking and conferences and actively maintaining your social media presence are all great ways to get noticed and position yourself as a thought leader. It may appear difficult at first, but its vital training for your development as a leader.

The most challenging element of raising your profile is finding your audience and in this endeavour, social media is your friend. The online procurement community is enormous, active and hungry for information. By connecting into this community, you amplify your opportunities to learn and to teach.

There are procurement groups on LinkedIn with over 300,000 members. Twitter is awash with market information that can enable procurement professionals to do their jobs better and Procurious, the social media network we established to connect procurement peers across the globe and facilitate knowledge sharing.

The social media world is waiting to hear your story; it’s your job to get out there and tell it.

  1. Build a reputation for developing others

One of the most important attributes HR will be looking for in a CPO (or any leader) is their ability to develop people and build a high-performance team. No matter how junior you are in an organisation, there are always opportunities for you to demonstrate that you are focussed on others’ professional development. You can mentor someone looking to get into procurement, you can share your ways of working openly with your peers, you can suggest bringing in some training or speakers to talk to the team on a topic of mutual interest, you could even be a “millennial mentor” for one of your bosses. There are a myriad of opportunities to demonstrate that you understand the power of people continually learning and developing. 

  1. Work for blue-chip companies

Firstly, let’s remember that the CPO role itself only exists in larger companies. Secondly, larger companies prefer to hire people who have already worked at other large companies.

Why? Because it’s safer.

Great companies (on the whole) invest in developing their people, they have great values systems that, by osmosis, influence the performance and behaviour of their people. This means that you become both a technical and ethical “output” of the companies you work for. This may seem a bit weird, or scary, but it’s true; “The company you keep defines your character and your character defines your success.”

What is ‘keiretsu’ and why does it matter for supply chains?

Japanese business practices

There are numerous Japanese business terms that have made their way into the common English business lexicon. Kaizen and the 5S’s (seiton, seiri, seisou, seiketsu and shitsuke) are just a few. One that you may not be completely familiar with is ‘keiretsu’. While it doesn’t receive the same coverage as Kaizen, this practice carries significant supply chain implications.

Keiretsu occurs when a set of businesses with interlocking interests take a financial share in one another.

This practice, which is akin to a large buying organisation owning significant shares in one of its suppliers (and vice versa), is very common throughout the Japanese economy (particularly in the automotive industry). As multinational firms continue to drive towards vertical integration, we are starting to see more it in the West as well.

The successes

The interlocking structure of keiretsu is held up as one of the key factors that contributed to the immense success of Japanese carmakers through the 90’s. It was thought that by taking a financial interest in their suppliers (and by offering suppliers shares in their own business), Japanese car makers were able to diffuse the traditionally antagonistic nature of buyers/supplier relationships, allowing the two organisations to more readily reach mutually beneficial outcomes.

Acceptance in the West

Broadly speaking, the idea of keiretsu hasn’t sat well in American business circles. This is due in some part to the sense of xenophobia the term instils. Keiretsu was perceived by many in the US as a ploy by the Japanese to protect their own business interests from American competition, by only doing business with people they know.

Despite this reluctance, as western business leaders saw keiretsu succeed, they started to emulate it. In a 1997 article in The New Yorker magazine, Ken Auletta went to great lengths to point out how keiretsu practices had become common at many of the worlds leading media organisations (including Disney, Time Warner, Microsoft, NBC and News Corp).

Undoing keiretsu

Like many business mantras it appears that while keiretsu helped to solve a great number of business problems, the business practice is also responsible for creating its fair share of issues.

Concerned with some of the inefficiencies that accompany the keiretsu business practice, Toyota this year elected to unwind some of these entangled business relationships.

In April, the automaker took the bold step of instilling a former Toyota executive, Yasumori Ihara, as the CEO of one of one of its leading suppliers (and keiretsu partner) Aisin Seiki Co.

Ihara’s job… To undo some of the keiretsu practices that had formed between the two organisations.

It was feared that the close relationship that had formed between the two businesses had created lethargy in the supply market meaning that neither business was functioning optimally. Toyota was not driving the most out its supply base and Aisin’s overly comfortable relationship with the automaker meant the firm was not pursuing contracts with other car manufacturers as actively as it might.

Ihara was put in charge of the supplier and told to make the business more competitive or face losing Toyota’s business. The new CEO has also been challenged with selling Aisin’s parts into other automakers.

No silver bullet

This isn’t the first time procurement teams have reached a similar stalemate. The keiretsu vs. traditional supplier relationship discussion sounds a lot like the cost vs. value or innovation vs. price debates we often hear.

Perhaps what is most important to take away from these issues and debates is the fact that there is no silver bullet for managing a supply chain. The issues are layered; to think that a single business methodology can solve all procurement challenges is to grossly underestimate the complexities that lie with modern day supply chains. The challenge is to find a balance between co-operation, innovation and cost.

So the next time you hear of a new business methodology that’s set to change procurement for ever, I would suggest you take it with a grain of salt (or perhaps a sip of sake…)

Why Supplier Risk Management Is Still The Big Thing

“Supplier Risk” is no longer a buzzword or an emerging trend. Nowhere is this more evident than for the food and retail industries, where what started with the horsemeat scandal in 2013 now seems to be haunting Europe as the nuts-for-spices scandal.

Yet risk is an issue that cuts across many industries, around the world. The increasing globalisation of company supply chains compounds risk—and at the value chain level. Such risks have a material impact on companies, resulting in supply chain disruptions, material losses, and reputational damage.

Figure 1 shows the most prominent supplier-related risks that companies are exposed to currently.

supplier-risk

According to a November 2013 survey by PwC, 55 per cent of respondents believed that they had experienced at least one significant supply chain disruption over 2011–2013, and these disruptions increased costs for 42 per cent of the respondents and affected customer service for 39 per cent respondents.

Clearly, the need for proactive supplier risk management is no longer simply a nice-to-have—and that’s why 70.6 per cent of the CPOs surveyed for Procurement Leaders’ 2015 Trend Report noted that the time dedicated to risk management activities will increase in 2015.

What are Organisations Doing to Manage Risk?

A February 2015 Procurement Leaders article compares supplier risk to an iceberg. The top 10 per cent of the iceberg, which is visible, is financial risk. The remaining 90 per cent—the portion that is hidden below the surface—includes executive changes, geographical and political risks, and the risk of natural disaster, risks that progressive organisations are increasingly turning their attention toward.

A 2012–2013 Capgemini survey of CPOs lists some of the strategies employed by companies to manage supplier risk:

  • Switching to multisourcing for key inputs
  • Continuously monitoring supplier performance, and taking actions to mitigate emerging risks
  • Putting a clear process in place to continuously assess, mitigate, and manage supply risks
  • Developing a process to proactively analyze potential risks, and building supply chain contingency plans
  • Using external consulting service providers to help identify and mitigate risks
  • Training procurement teams in advanced supply risk management techniques
  • Implementing relevant technology solutions to support and manage supply risks

Take a look at several examples of how global organisations are working to mitigate risk across different areas of the supply chain:

Ford

Companies with widespread and complex supply chains can find themselves at sea while identifying high probability risks, especially those that have the highest impact on their bottom line. As such, organisations turn to new and sophisticated tools to help identify and mitigate risk—as was the case with Ford.

In December 2013, Ford announced a new supplier risk management strategy, developed in collaboration with MIT’s Dr. David Simchi-Levi. Assessing Ford’s supplier risk was a challenging task, given that the company sources thousands of components from ~4,000 tier 1 suppliers. The risk assessment model was based on Dr. Simchi-Levi’s Risk Exposure Index approach, and concluded that a short disruption pegged at 61 per cent of the tier 1 firms would not have an impact on Ford’s profits. Yet a disruption in supplies from 2 per cent of the firms studied would have a substantial impact. Leveraging this analysis, Ford has focused its efforts on those firms that account for the highest supply chain risk. 

EID-Parry

For companies that rely significantly on a single geography, commodity, or supplier, it is essential to diversify their purchasing in order to reduce the impact of any disruptions in supply from that single source.

India-based sugar manufacturer EID Parry is expanding its business outside the state of Tamil Nadu. The company’s Executive Chairman A. Vellayan assured shareholders at a July 2014 annual general meeting that they will see long-term benefits of the company’s policy of spreading out its sugar mills across a number of Indian states. 

P&G

Suppliers that engage in practices such as unsustainable sourcing of commodities, use of child labor, and unsafe manufacturing practices pose a grave threat to the reputation (and ultimately economics) of companies that source from them.

A case in point is Procter & Gamble. Following a February 2014 Greenpeace report on the deforestation practices of some of the company’s palm oil suppliers, the company released an extensive no-deforestation policy aimed at encouraging sustainable sourcing practices among suppliers.  

Kellogg’s

Similarly, Kellogg’s announced its commitment to purchase only deforestation-free palm oil, with a target date of December 31, 2015. The company also introduced a new responsible sourcing policy that seeks to reduce the impact of its supply chain on climate. This includes the provision of resources and education to help suppliers increase their resilience with respect to climate change, optimise the use of fertilizer inputs, reduce GHG emissions in their agricultural practices, optimise water use, and improve soil health. 

The Underlying Trend

In an environment of increasing supplier-related risks, it is crucial for companies to strengthen supplier engagement in order to mitigate threats such as supply discontinuity, over-reliance on key suppliers, and reputational damage from supplier activities. To gain competitive advantage, it is important for them to identify, assess, and efficiently monitor and manage such risks—piecemeal or as part of a broader integrated strategy. The underlying trend, though, is clear—as procurement departments mature and organisations grow, an integrated risk management strategy will be the most effective path forward.

By Ankit Abraham Sinha, Senior Analyst, & Sidharth Sreekumar, Assistant Manager – The Smart Cube, a global professional services firm specialising in custom research and analytics. 

4 Recommendations for Achieving World-Class Procurement Performance

According to newly-published research from The Hackett Group, world-class procurement organisations are now delivering services at 17 per cent less cost than typical companies.

World class procurement findings from The Hackett Group

The research identified that procurement organisations are able to gain an upper hand thanks to their deep understanding of the needs of their business, and in-turn reacting quickly to changing requirements, driving higher overall value and greater stakeholder satisfaction.

To achieve world-class performance, The Hackett Group recommends that procurement organisations take a structured approach to improving the customer experience, focusing in four areas:

Identify stakeholders

First they should identify and understand key stakeholders, and segment their internal customers based on attributes such as importance and level of influence within the organisation. In addition to seniority, issues such as language, culture, and even personality should be taken into account.

On average procurement organisations who’ve improved stakeholder alignment report 28 per cent higher savings than those that don¹t.

Satisfaction surveys

Next, procurement organisations can develop formal customer satisfaction surveys tailored to key stakeholders, taking care to use a variety of ad-hoc and structured approaches to gain deeper insights.

The research indicated that procurement organisations viewed as a true business partner report 68 per cent higher savings than those viewed as gatekeepers, reflecting higher effectiveness at both cost reduction and cost avoidance.

Take feedback onboard

Procurement organisations should also analyse the results of customer satisfaction surveys, and ensure that stakeholders understand their feedback is being valued and utilised.

Self-service tools

Finally, procurement can improve their level of customer service by taking a holistic view, and by implementing self-service tools to answer common inquiries and provide real-time visibility into order status.

Chris Sawchuk – Global Procurement Advisory Leader, notes: “They have increased the scope of their spend influence, the savings they are able to capture, and the value delivered beyond hard-dollar savings, in part by emphasising on-demand analytics and market intelligence, and realigning their service portfolio.”

To view the research in full visit http://bit.ly/1BQOSeJ

Enjoyed this article? Sign-up to Procurious for FREE and join 6000+ other professionals.

Bridging the Procurement Talent Gap with ISM CEO Tom Derry

Welcome back to the Second Part of our interview with the CEO of ISM, Tom Derry. In Part One Tom spoke about the changes occurring within our function and outlined the vast opportunities a career in procurement and supply chain presents.

Today we’re discussing talent, more precisely, the procurement talent gap.

How to bridge the procurement talent gap

Procurious asks: We hear a lot of talk about the procurement ‘talent gap’. ISM itself has called this out as a potential issue facing the function. As a representative industry body, do you feel that your organisation has a role to play in closing this gap?

Tom: Within the United States we’re witnessing a demographic shift. A huge number of people will be retiring within the next ten years. By 2025, the so-called millennial generation, people born from 1980 onwards, will constitute three quarters of the global work force. So clearly, there is a lot of knowledge that is about to leave the workforce. We need to ensure that knowledge is transferred across to the younger generation.

Also, the rate at which technologies and the markets move now, means we need to be constantly up-skilling just to stay up to speed.

The skills issue real, it’s a challenge that most companies are aware of.

ISM wants to be the facilitator that addresses this skills gap and allows procurement and supply chain teams to succeed well into the future. We’ve recently developed a model that enables us to effectively do this; it’s called the Mastery Model.

The Mastery Model provides a strategic approach that allows procurement and supply chain teams to deepen their expertise. The model is designed to drive organisational success through increasing staff capability.

Whether you are early in your career, just entering in the field, or a highly skilled supply chain professional, the Mastery Model can be used to make sure you continue to build up your experience and expertise.

The model defines 16 major competencies and 69 sub-competencies, tailored to four different career levels: essentials, experienced, leadership and executive. Users complete a self-assessment process; this is linked to their own personal aspirations. The Mastery Model then maps out a competency based learning and development program that will enable the user to develop the skills required for their desired role.

The Mastery Model takes the mystery out of understanding the steps you need to make the next jump in your career. 

Procurious: It sounds like a great way to open up a conversation between an employee and a manager around personal development planning.

Tom: Absolutely, staff members can determine the sort of role or position they are after, fill out the self assessment section and be provided with a run down of the areas they need to develop in order to be effective in their desired role. This can lead to very constructive conversation between employees and their managers.

I have to point it out that the tool is multidirectional. We’ve had employees approach managers after having completed the assessment. Managers too, have used the Mastery Model as means to set a development path for their staff and we’ve also seen managers and employees sitting down together to work through the assessment to create a personal development plan.

Procurious: Can you give us some insight and background into how the Mastery Model was developed?

Tom: As an organisation, ISM has been certifying competency for a great number of years. Over this time, we’ve developed an amazing database detailing the evolution of peoples skills within a procurement and supply chain context. It’s at the core of what we do as an organisation.

Now what we’ve done, is build upon that knowledge base to develop a tool that can be actively put into practice in the supply chain and procurement community. An advisory committee that was comprised of procurement professional, practioners and internal staff here at ISM developed the tool. Working together with these great professionals, we’ve been able to develop a model that strategically maps and matches training materials to your career experience and aspirations.

Procurious: What sort of time commitment does an assessment on the ISM Mastery Model require?

Tom: Well, that really depends on individual company, but it’s not a long process. In one thirty-minute session most people would be be able to complete it. What we encourage, is for people to do it in stages; complete your own sections then take it to your manager and get their input and review.

At a conference back in June, I had three young professionals to come up in front of the audience I was addressing. I asked them specifically about their career goals “where are you headed?” I asked. As the conversation flowed, we did their assessments live on the website, we drove down into specific competencies and consulted their levels of experience in certain areas. At the end of the process, a series of resources popped up that showed them what they needed to do to get to where they wanted to go in their careers.

After that, they were in a position to go back to their bosses and say “here are some areas I can work on to get better at my job”. I think that’s pretty powerful.

Procurious: The Mastery Model sounds like a fantastic tool. How can people out there access it.

Tom: It’s simple, just go to the ISM website. If you’ve already got an account with us, just log in and away you go. If you don’t have an account yet, you can get one right there on the spot.

Stay tuned for part three of Tom Derry’s chat with Procurious where Tom will talk us through the importance of social media in the procurement and supply chain space.

If you would like more information on ISM’s Mastery Model you can find it here.

Does Artificial Intelligence Have A Place In Procurement?

With the recent innovations in artificial intelligence, will the supply chains of tomorrow be at the mercy of robotic overlords? If so, do we have anything to fear?

Does artificial intelligence have a place in the supply chains of the future?

There’s a change happening on factory floors the world over, as robots and automation increasingly replace the manual (human) workforce of old. We’ll dip into the possible effects artificial intelligence (AI) could have on production and procurement practices as we go along, but first, a bit of scaremongering… Elon Musk has previously aired his own warnings while giving a talk to students from Massachusetts Institute of Technology (MIT), saying:

“I think we should be very careful about artificial intelligence. If I had to guess at what our biggest existential threat is, it’s probably that. So we need to be very careful… I’m increasingly inclined to think that there should be some regulatory oversight, maybe at the national and international level, just to make sure that we don’t do something very foolish.”

Of course it’s perfectly natural to fear change. We must also be mindful that artificial intelligence is still very much evolving, and at this stage it’s an unknown quantity. There are some camps that fear the worst, that AI represents the destruction of mankind, with robots and humans embroiled in a bitter battle for survival. Flesh vs. circuits, the human condition vs. sentience…

Not so according to Mustafa Suleyman – Head of Applied AI at Google DeepMind, who instead believes that this modern intelligence will help tackle some of the biggest problems facing the world today (think access to clean water, financial inequality and stock market risks). Indeed, the work of DeepMind was something Wired Editor David Rowan touched on at Procurement Leaders’ London gathering earlier this year.

David told us how DeepMind had created a “generalised artificial intelligence” – the earliest example of which was able to not only play Space Invaders, but master it to become the best player in the world. While this demonstration is certainly impressive, how can it translate to real-world scenarios?

The answer lies in Big Data as DeepMind observed: “We have global information overload from overwhelming systems complexity – they’re so complex and interlinked it’s possible that the US financial crash in 2008-9 caused the Egyptian revolution” [a time of widespread corruption and a stagnant economy that led to a national bread shortage].

If all of this (Big) Data is just sitting around, waiting for consumption, then why shouldn’t we make it available to robots for analysis and dissemination?

Indeed, the significance of Big Data has not gone unnoticed by procurement’s leading lights…

A 2010 paper entitled ‘Artificial intelligence in supply chain management: theory and applications’  reviewed the past record of success in AI applications to SCM and identifies the most fruitful areas of SCM in which to apply AI.

Similarly in an incredibly-thoughtful piece, Author of Supply Chain Visability.com -Jonah Saint McIntire, observed: “In time, as new generations of the AI are deployed, something truly game changing will occur. This is because machine learning will cross human learning capabilities fairly slowly. Remember that intelligence is modular and, as a result, machines may exceed humans in some forms of learning while lagging in others. The real breakthrough occurs when all necessary forms of learning are dominated by AI rather than human intelligence.”

He goes on to make a bold claim : “Our ability to manage data to the advantage of our supply chain and company will become a significant, perhaps even singularly important, part of supply chain visibility. It’s within the context of a mounting tsunami of data and the need for data-management that we must expect increasingly “intelligent” software to be deployed. The main users of supply chain visibility will probably switch from people to computer programs.”

This ‘bold claim’ was supported in an article written by Lora Cecere, founder of Supply Chain Insights – in which she said:

“Today’s supply chains are more complex than before. While the structured data and the systems that use them will not go away, new forms of data offer new opportunities for companies to solve previously unanswered problems. These new data types—from mapping and GPS sensors, to voice, images and video—do not fit into traditional applications or data models. That’s the bad news. The good news, as we learned in a survey of 53 IT and supply chain managers, is that companies are beginning to recognize that they have a problem and that they need to respond. While there is a general lack of understanding of big data terms and technologies, there is an awareness that supply chain best practices are moving from insights into supplies to leveraging insights into demand.”

If AI can help us realise that we have a problem, why then should we be fearful of this new technological dawn?

John McAfee – infamous programmer and creator of the world’s first antivirus software,  has long insisted “that if you are a ‘routine cognitive worker’ following instructions or doing a structured mental task,” then it is your job that’s most at risk from the inevitable rise of the machines… How does this make you feel? As ever we’re keen to hear your thoughts, so fire away in the comments below.

Meanwhile here are the other stories you need to be reading in procurement and supply chain this week.

Fears over state of Chinese economy increase supply chain risk

  • Concerns over the financial health of Chinese businesses have pushed supply chain risk up for the third consecutive quarter, according to the latest CIPS Risk Index.
  • Worries a speculative equity bubble is about to burst, and that state lenders have been supporting employment by lending to struggling businesses, meant the index rose to a figure of 80.1 in the second quarter of 2015. This compares with a reading of 78.7 for the first three months of the year, and the highest since the end of 2013.
  • Andrew Williamson, global leader and leading economist at Dun & Bradstreet which co-produces the index, said: “We became increasingly concerned in April that corporate finances in those industries that clearly have excess capacity were becoming increasingly distressed. Local governments have been propping up employment by pressuring banks, further exacerbating legacy financial misallocations in the country.
  • CIPS economist John Glen said: “The increasing trend in global risk that was observed towards the end of 2014 and predicted to increase in the early part of 2015 has materialised.

Read more at Supply Management
UK companies to produce anti-slavery supply chain reports, says UK PM

  • Companies with turnover of more than £36 million will have to publish an annual slavery and human trafficking statement, under a clause in the Modern Slavery Act that comes into force from October. 31 Jul 2015. The measure will cover all businesses who do business in the UK and have supply chains elsewhere in the world, UK prime minister David Cameron said.
  • The statement must describe the steps taken to ensure slavery and human trafficking is not taking place in any of a company’s supply chains or their own business – or state that they have taken no steps on this. Speaking in Vietnam, Cameron said that the “scourge of modern slavery has no place in today’s society and I am proud of all that Britain is doing to wipe it out … But there is still much more to do”.

  • The planned disclosure measure “is one of the first of its kind in the world and it will be a huge step forward, introducing greater accountability on business for the condition of their supply chains,” Cameron said.

Read more at Out-Law.com

Supply Chain Risk: Five Worst Offending Countries For Human Rights Violations

  • Awareness of supply chain risk has been steadily growing among publicly listed companies all over the world. Today’s news is not reassuring: the risk of organizations breaching international human rights regulations has risen significantly over the last quarter as key Asian economies adapt to tougher economic conditions, according to a report just out.
  • Rising labor costs in China have led companies to diversify their supply-chains into other high-risk countries such as Vietnam, especially for electronics, apparel, and footwear says the British Standards Institution (BSI). Its latest Risk Index Report out today identifies China, India, Vietnam, Bangladesh and Myanmar as the five highest risk countries for human rights violations.
  • These countries account for 48 per cent of global apparel production, 53 per cent of global apparel exports and 26 per cent of global electronics exports – making it very clear which are the industry sectors most likely to be at risk. The latest report also warns that efforts by Asian governments to boost their economies are resulting in a greater prevalence of child labor abuses to become more present in supply chains.

Read more at Forbes

Barclays Africa launches supply chain challenge

  • Barclays Africa Group Ltd (Barclays Africa) has launched the Barclays Africa Supply Chain Challenge, the first of several initiatives being driven into Africa with the aims of sparking ideas to drive the digital evolution on the continent.
  • According to Stephen van Coller, Chief Executive of Corporate and Investment Banking at Barclays Africa, the Challenge is about improving supply chain transparency for African businesses. “The journey of a product from manufacturer to consumer is often disjointed and inefficient and there is currently a huge amount of interest in finding ways to increase the transparency of provenance, not least of which is the use of blockchain technology,” commented van Coller.
  • The Barclays Africa Supply Chain Challenge is open to entrepreneurs and developers, between the ages of 18 and 35, who are based in Africa.