What is causing Aussie CPOs to lose sleep?

What’s causing Aussie CPOs to be sleep-deprived? Talking-points from The Faculty Roundtable’s latest round of discussions reveal all…

What's keeping CPOs awake at night?

Following on from the success of Tania Seary’s recent article ‘The Five Disruptive Forces that will Keep CPOs Awake at night in 2015,’ The Faculty Roundtable (a series of CPO meetings held in Australian capital cities and in Singapore) decided to put the same question to some of Australia’s leading CPOs.

The issues below are summary of the discussion that took place on this topic in the recently completed August Roundtable series.

  1. Cost vs. Customer Centricity Dichotomy

In Roundtable meetings across the country, CPOs discussed the challenge they faced in finding a sustainable balance between meeting the expectations and requirements of its internal customers, while at the same time ensuring corporate cost cutting objectives were achieved. CPOs discussed how providing value-add services often flew in the face of traditional cost-saving procurement and that one of their greatest challenges was to navigate this tricky dichotomy.

One Sydney CPO highlighted creating close links with the C-Suite as the best means to achieving this balance. He linked the challenge to a business analogy discussed in the Harvard Business Review, claiming that CPOs needed to have a sound understanding of the legwork and operational challenges their team faced while stressing the importance of taking a step back and viewing the team’s performance “from the balcony” and linking every activity and strategic decision directly to corporate objects.

CPO discussions in Perth centred on the increased spotlight the procurement function has found itself under since global commodity prices started to slide. CPOs there said they had been asked to not only cut costs but also to identify and define new revenue streams.

The discussions in Perth covered the necessity for procurement teams to drop the procurement lingo and start speaking about the business more broadly. Melbourne Roundtable members suggested procurement teams need to address how we as a function can help achieve organisational success not procurement metrics. Perth Roundtable presenter and 2015 Procurement Leader of the Year, Kylie Towie has previously discussed this on the Procurious blog.

  1. Developing Talent

Talent continues to be a major cause of concern for Australian CPOs. One CPO went so far as to say “Capability building is the biggest issue facing Australian procurement.”

Throughout the roundtable series, CPOs discussed the fact that as the role of procurement continues to grow and change within our organisations, so too does the required skill set of procurement teams. A Brisbane CPO claimed that attracting and retaining top corporate staff needs to remain a top a priority for procurement. He went onto to say; that while the functions image is improving the battle to attract top corporate talent is as ferocious as ever.

Another Brisbane-based CPO made gave some interesting insights into the disconnect between talent management theory and practice. He claimed that theories alone couldn’t motivate teams to do something; only actions can do that. The same CPO claimed that implementing talent management processes required constant attention and commitment. The example of a mentorship program was used to describe the challenge. The organisation had decided that implementing a mentoring program would be a great way to motivate and develop junior staff. This was in fact true. However, the challenge lay not with motivating junior staff to participate, but rather in encouraging senior staff to act as mentors. Many leaders either were unable to see the value in the project or did not feeling comfortable acting as a mentor.

  1. Proving Procurement’s Worth

This fear has long been with the CPO and it seems it’s as strong today as ever. Across the country, CPOs highlighted the constant need to validate and prove their worth. There was general agreement amongst the Australian procurement leaders that this will (and should) continue to be the case.

CPOs, particularly those working in the resources sectors, mentioned that they were under increasing pressure from CEOs to not only identify savings, but to track these benefits all the way through the P&L. To this end, CPOs expressed great interest The Faculty’s upcoming research paper “Making it Stick” which is designed to ensure that CPOs and procurement teams realise all negotiated savings. The paper, which will be release on 17 September, highlights that more than 50 per cent of savings negotiated by procurement teams fail to find their way to the bottom line. The report provides a road map and points out pragmatic strategies that procurement teams can implement to ensure these savings are realised. Stay tuned to Procurious for more information about this highly anticipated research paper.

  1. Managing the Rate of Change

“The pace of change is so intense, it can be a struggle just to keep up,” claimed one CPO. This sentiment was echoed by most of the CPOs we spoke to as they discussed the importance staying on top of technology trends and tried to understand how this rapidly changing environment might impact their operations.

Discussing the need to leverage new technologies, a Brisbane based CPO claimed, “its not enough to just carry on running tenders, we need corporate game changers.”

The CPOs went into some detail discussing the challenges procurement teams faced when it came to adopting new and disruptive technologies. A lot of it boiled down to procurement professionals having a strong fear of failure.

“Some of our staff are scared to fail and this impacts what we can achieve,” said one CPO. While this aversion to risk may be beneficial in many areas of procurement, when it comes to implementing new ideas or ‘game changers’ its can hinder progress.

Pulling reference from the tech and start-up sectors, one CPO stated that, “In order to take full advantage of new technologies and operating processes we need to be ready to fail fast and fail often.”

The Faculty Roundtable comprises of an elite group of Australian and Asian procurement leaders who gather to share their experiences and insights, to achieve greater commercial success for their organisations.

Meetings are held throughout the year in Melbourne, Sydney, Perth, Brisbane and Singapore. To find out more or to get involved click here.

Why CPOs and CIOs are the new #BFF (That’s Best Friend Forever, duh!)

Lisa Malone writes from The Smart Procurement World Conference, held this week in Johannesburg, South Africa (On Twitter? Follow @SmartSPW).

Why CPOs and CIOs are the new #BFF

With the exception of Supplier Development (more on this in a future article), technology, specifically Cloud-based solutions and social media, has been the hot topic of this Smart Procurement World Conference.

This should come as no surprise really… Technological change has never been more rapid, nor impacted more areas of the business. Today everything from regulatory requirements, internal controls, data mining, business intelligence, supply chain visibility and customer experience, are largely controlled by technology platforms.

Technology has not only changed the way we are running our businesses internally, but increasingly businesses are pivoting and building their entire value proposition on the back of technology.

Take for example some of the globe’s fastest growing businesses: Uber and Airbnb have both disrupted their respective industries and rather than a physical product or service, have a technology interface at their core.

Between robotics, artificial intelligence, 3D printing and Terahertz imaging, technology is undoubtedly disrupting the way every business operates. For some, this paints an exciting vision of the future, but for others it’s downright scary.

What all this change makes implicit is the growing importance for CPOs to develop closer working relationships with the CIO.

Mariette Steyn, VP Supply Africa, South 32, opened discussions on the Ariba Panel today by saying CPOs need to have a much greater appreciation of the business’ technology roadmap.

“CPOs must develop a much deeper understanding of the role technology will play in the future of their industry and business.

“With technology so central to competitive advantage, buying technology at the lowest price will rarely be seen by the C-Level as delivering value.”

Mariette’s second observation is that CPOs now, more than ever, need to speak the language of the business.

It should be noted that the ability to have intelligent conversations with functional stakeholders (and particularly, being able to speak the language of finance, is nothing new.

If you’re not aged between the ages of 13 – 17 (where this kind of linguistic ability is achieved through osmosis) or a bona fide technology-geek, talking tech can be especially tough. The mere mention of Tweets, hashtags, or tera-bytes, never mind API, RSS feeds and Xcode and plenty of CPOs’ eyes will simply glaze over.

But with technology increasingly becoming the business (rather than a physical product or service), tech literacy will soon be fundamental for every businessperson and in particular, CPOs.

It goes further than this: In the resources sector, where cash is king, Maria explains it’s not simply about being able to talk the technical advantages of Cloud. The best CPOs will be multi-lingual, jumping effortlessly between CIO-ese and CFO-ese.

“In one breath, I need to speak intelligently about Cloud solutions with my CIO, and in the next breath, translate this message, or rather sell Cloud’s to the CFO on it’s ability to scale, accuracy of forecasting and where it makes sense, the benefits of moving spend from CAPEX to OPEX.”

If only it were that simple… These days you’ll be expected to help your CIO articulate potential financial implications in one breath, while bestowing the benefits of using operating expenses to account for technology investments in the other.

Speaking from their own decoupling with BHP Billiton, Mariette also explains that in their case, the conversation could be framed in terms of Cloud’s advantages in a demerger environment.

“Not having to physically pick up a server means you can exploit the technology and decouple technology far more quickly.

Were you at the Smart Procurement World Conference too? Follow along with our coverage on Twitter and Tweet @SmartSPW.

Zero hours contracts represent a small but useful part of flexible labour market

Latest figures from the ONS indicate that the number of workers on zero-hours contracts has risen by 6 per cent.

The ONS has revealed a 6 per cent increase in zero-hours contracts

The Office for National Statistics (ONS) produces biannual estimates of the number of contracts that do not guarantee a minimum number of hours.

These estimates are based on a survey of businesses and the measure complements the figures from the Labour Force Survey (LFS) which indicates those workers on a “zero-hours contract”.

The latest estimates reveal that:

  • The number of people employed on a “zero-hours contract” in their main job was 744,000 for April to June 2015. This represents 2.4 per cent of all people in employment – compared to 2 per cent in the same period during 2014.
  • Number of contracts that do not guarantee a minimum number of hours where work was carried out was 1.5 million for the fortnight beginning 19 January 2015. This is some 6 per cent higher than the estimate of 1.4 million for the fortnight beginning 20 January 2014, though the increase is not statistically significant.
  • On average, someone on a “zero-hours contract” usually works 25 hours a week.
  • Around 40 per cent of people on “zero-hours contracts” want more hours, with most wanting them in their current job.
  • People on “zero-hours contracts” are more likely to be women or in full-time education. They are also more likely to be aged under 25 or 65 and over.

Commenting on official statistics  James Sproule, Director of Policy at the Institute of Directors, said:

“Although zero hours contracts have drawn much political attention, only a very small proportion of the total workforce have one for their main job, less than 2.5 per cent of the total. It is also important to note that statisticians at the ONS say it is not possible to tell whether this is simply because of increased awareness created by media exposure. 

“Zero hours contracts offer businesses and employees an important degree of flexibility. For skilled professionals, a degree of flexibility can boost their earning power, while flexibility also suits students and older people – the main users of zero hours contracts – who cannot commit to a set number of hours each and every week. 

The ONS has revealed a 6 per cent increase in zero-hours contracts

James continues: “Flexible working arrangements helped preserve jobs during the downturn and protected the UK from double-digit rates of unemployment. As businesses began to create jobs at a record pace, attention on the quality of those jobs and concerns around zero hours contracts boomed. This helped make sure practices like exclusivity clauses – something which run contrary to the very flexibility zero hours contracts were designed for – were stamped out.”

The new findings come with a caveat in that the number of people saying they are employed on “zero-hours contracts” depends on whether or not they recognise this term. It is not possible to say how much of the increase between 2014 and 2015 is due to greater recognition rather than new contracts.

Half Of Supply Chain Managers Lack The Skills To Do Their Jobs

A new poll from CIPS reveals that half of supply chain managers lack the necessary skills.

Supply chain professionals lack the skills needed

If the results of a new survey undertaken by CIPS are anything to go by, almost half of supply chain managers fear they lack the necessary skills to carry out their jobs.

The poll found that 45 per cent of respondents felt they had not received the necessary training.

The survey was made up of 460 CIPS members who hailed from the UK, Australia and South Africa.

Commenting on the results, David Noble – CIPS’ chief executive, believes that the recovery of the UK economy is being threatened by a lack of skills. “Supply chain managers are the first line of defence for British consumers and businesses.”

He continues: “They protect shoppers from harmful products, stop our businesses from being ripped off and keep slavery out of Britain’s supply chains.

“These new figures show that our tentative recovery is being undermined by a lack of skills. Without them, we risk building our growth on human rights abuses and malpractice abroad. Supply chain professionals are doing the best they can with insufficient training but as the threats to British supply chains continue to evolve, so skills must be continuously renewed to keep up.“

Confidence takes a knock

60 per cent went on to add that procurement (as a profession) is not looked upon favourably within their business.

The figures set a worrying precedent indeed, as those without training are unlikely to conduct annual supplier audits, and just 16 per cent stated they have eyes on their entire supply chain.

Out of those polled, those who felt inadequately trained also revealed their fears over malpractice in the supply chain.

Do you agree with the results of this survey, and if so do you share the same fears? If so, what do you think can be done to improve the outlook in the short/long term?

If you haven’t had time to check out the big stories in the procurement and supply chain space this week, here are some of the main headlines.

Procurement Bill to correct ‘unsound’ practices in Zimbabwe

  • In a State of the Nation address last week, Robert Mugabe announced a new Procurement Bill would be drafted and tabled in Parliament before the end of the year.
  • The Bill will incorporate COMESA procurement guidelines which emphasise devolution of power to award tenders to procuring entities. These organisations will include government ministries, parastatals, state enterprises and local authorities, Mugabe said.
  • The State Procurement Board will also be transformed into a new non-executive procurement authority tasked with setting standards and guidelines as monitoring compliance by procurement entities and act as advisor to the government on Public Procurement Policy.
  • President Mugabe said economic growth was expected to be 1.5 per cent in 2015, instead of the initially projected 3.2 per cent, which he mainly blamed on the negative impact of drought in the agriculture sector.

Read more at Supply Management

Fast fashion is becoming a family affair

  • Step aside, H&M, there’s a new fast fashion king in town, and it’s not just for teens and 20-somethings buying $8 crop tops and $18 skinny jeans.

  • Primark, an Irish retailer owned by Associated British Foods, is the latest European so-called fast fashion brand to dive into the U.S. market. The retailer will open its first U.S. store on Sept. 10, 2015, in Boston and it has confirmed the opening of a second store in King of Prussia, Pa., this fall, with plans for seven more over the next two years.

  • The chain, with more than 285 stores across Europe – and amazingly, no e-commerce presence – is set to compete with other fast fashion European brands that are household names in the U.S., including Sweden’s H&M, Spain’s Zara, and U.K.-based TopShop.

Read more at Yahoo! Finance

UK Police forces wasting millions by paying 10x more for items

  • Police forces are wasting millions of pounds of taxpayers’ money because of the chaotic way they buy supplies, with some paying up to 10 times more for similar items.
  • Mike Penning, the policing minister, said that it makes “no sense” for forces to continue buying almost identical items separately when they can save money by acting together.
  • The Home Office published figures revealing huge disparities in the amount paid for basic equipment ranging from shirts and batons to high performance vehicles and radio sets.
  • Mr Penning said: “For too long the police have approached the market in a fragmented way, buying equipment in small amounts and to varying specifications.

Read more on The Telegraph

The most important procurement agreement you’ve never heard of

  • Australia is seeking to be admitted to an international trade group on government procurement. The agreement will mean local suppliers will gain access to the government procurement markets of all member states, which include the 28 members of the European Union and the US.
  • The group is called the WTO Agreement on Government Procurement (GPA). The WTO – the World Trade Organisation – initiated the GPA in 1981 as the ‘Tokyo Round Code on Government Procurement’. It has been expanded and renegotiated ever since, with the most recent round concluded in 2014.
  • The Government says that joining the GPA will mean “legally-binding access to government procurement markets estimated at US$1.7 trillion”, a number so large it is difficult to comprehend. China, which is also seeking to join, could add another trillion dollars to the sum.

Read more at Government News

iPhone supply chain makers set to see strong sales in September

  • Makers in the iPhone supply chain are set to see strong sales in September thanks to incoming orders for new iPhone devices which are due to be unveiled in early September, according to sources from the supply chain.

  • Most suppliers have become more positive about shipments of the updated iPhone devices recently due to higher than expected orders from Apple, which were originally perceived to be affected by sluggish global economy and weakening smartphone demand in emerging markets, said the sources.

  • Incoming parts and components orders for the new iPhones are even stronger than orders for the iPhone 6 devices in the corresponding period of a year earlier, indicated the sources, adding that shipments of updated iPhones will once again squeeze sales of other vendors including Samsung Electronics, Sony Mobile Communications and LG Electronics, commented the sources.

Read more at Digitimes

Procurious Big Idea #39 – Creating Awareness At University Level

Huey Chan, Analyst at The Faculty, believes a lack of awareness at the university level is harming procurement’s ability to attract the right talent.

Huey says this talent drought can be combatted by CPOs spending time getting in front of students and talking about what a job in procurement entails.

See more Big Ideas from our 40 influencers

Like this? Join Procurious for FREE and meet like-minded procurement professionals from across the world.

Why Collaboration May Encourage Corporate Corruption

A new scholarly study has looked into the collaborative roots of corruption, and the results may come as a surprise…

New research claims that collaboration may encourage corruption

New research from Nottingham University suggests that collaboration encourages corrupt behaviour.

“Collaborative settings, not just greed, can provide fertile ground for corruption, as typified by recent scandals in the football and banking worlds. But while much is known about individual immoral behaviour, little is known about the collaborative roots of corruption,” researcher Dr. Ori Weisel said in a statement.

Weisel and his team focused on cases where working together meant violating moral rules, by lying, at a possible cost to the larger group, or the organisation to which they belong.

For the study, researchers created a die-rolling game in which study participants could adhere to one of two competing moral norms: collaborate or be honest. In the main experiment, the outcomes of the two players are perfectly aligned.

“Humans are an exceptionally cooperative species, which is at least partly driven by deeply ingrained moral sentiments that help to build trust and achieve mutual beneficial outcomes. However there can be tension between two fundamental moral obligations — to tell the truth or to join forces in collaboration,” said Weisel, a research fellow who specialises in group cooperation and decision-making.

Researchers found that the highest levels of corrupt collaboration occurred when parties shared profits equally, and were reduced when either player’s incentive to lie was decreased or removed.

Weisel said the findings support the view that collaboration might have been a liberating effect, freeing people to behave unethically.

The researchers suggest that organisations may be paying a (corruption) premium for having their employees team-up and work together.

“From the point of view of an organisation seeking to reduce corrupt behaviour, assuring a decent base salary that does not depend on performance can reduce the likelihood that its employees engage in brazen lying,” Weisel added.

4 key collaboration takeaways that will make your job easier

Threat of extreme weather events could trigger global food shocks

The global food industry currently undergoes a production shock every 1 in 100 years. But newly published guidance claims we can expect 1 (or more) in just 30 by 2040.

Threat of extreme weather could affect food supplies

The threat of extreme weather looms large over our global food supplies…

With weather records being broken like they’re going out of fashion, it isn’t just the threat of a soggy commute or a windswept day at the beach that should be top of our concerns… Lest we forget the livelihoods of those struggling against the elements to grow crops, transport their wares and ultimately feed their families.

Traditionally the food system we’ve all come to rely on is a truly global enterprise, with extreme weather having little discernible effect on the logistics of getting produce from A to B.

However as we’re hearing more and more about the threats posed by extreme weather events, we have to ask – how prepared are we for just such an eventuality? The question is made all the more worrying when we consider our food system has become efficient to a fault, yet less resilient as a consequence.

In answer to the growing volatility, a taskforce of academics, industry and policy experts was commissioned to examine the resilience of the global food system to extreme weather. Its report is available at the following link [read the report], but the executive summary (republished below) highlights some of the overriding issues that need to be addressed.

Understand the risks better

Our knowledge of how extreme weather may be connected across the world, and hence the precise probability of multiple bread basket failures, is limited by available model simulations (therefore more research is required).

Modelling limitations also constrain our ability to understand how production shocks translate into short run price impacts.

Explore opportunities for coordinated risk management

As knowledge emerges regarding plausible worst case scenarios, it will be possible for governments, international institutions and businesses to develop contingency plans and establish early warning systems with agreed response protocols. Other opportunities include coordinated management of emergency and/or strategic reserves.

Improve the functioning of international markets

History demonstrates that the actions of market participants in response to production losses, or the behaviours of other actors, are a crucial determinant of price impacts. Other problems that can exacerbate price spikes include low levels of stocks relative to consumption, poor transparency of market information and physical limitations on trade such as infrastructural constraints.

Bolster national resilience to market shocks

Governments should also consider policies to bolster national resilience to international market shocks. This is a particularly important policy agenda for import dependent developing countries with high numbers of poor food consumers, and/or high risk of political instability. The precise mix of appropriate policy measures will vary according to national context.

Adapt agriculture for a changing climate

Agriculture faces a triple challenge. Productivity must be increased by reversing declines in yield growth and closing the gap between actual and attainable yields in the developing world, whilst also reducing its environmental impact (eg 50:1 degradation, depletion of freshwater supplies, increasing greenhouse gas emissions or eutrophication). However, given the increasing risk of extreme weather, this cannot come at the expense of production resilience. Increases in productivity, sustainability and resilience to climate change are required. This will require significant investment from the public and private sectors, as well as new cross-sector collaborations.

How Do You Turn A Technical Expert Into A Leader Of The People?

How to turn technical staff into leaders

Procurious recently caught up with Karen Morley to discuss her upcoming presentation at the CIPS event in Melbourne, Australia. In the first part of our interview we learnt what separates good CPOs from great CPOs and discussed the impact truly great procurement leaders can have on their business. That article can be found <here>

Today, for the second part of our discussion with Karen, we’ll be covering the development of technical experts into leaders of people and pointing out what procurement professionals should be doing to continue their progression up the leadership ladder.

Procurious asks: In a recent LinkedIn Pulse article you published, you discussed the difficulties organisations face in transitioning technical experts into managers and leaders of people. Can you provide some commentary on that? 

Karen: I’m coaching a young woman at the moment who trained as an engineer. She was promoted into her first management role in 2011 but did her first leadership program in 2014. She has joking said that it would have been pretty handy if it had been done that the other way around.

It wasn’t until she got into the management program that she started to understand the concepts of leadership and the need to think differently when you are leading other people as opposed to when you are the functional expert or an individual contributor.

This sort of transitioning is something that I’m constantly working with people on.

When you are a functional expert, or an individual contributor, you are responsible only for yourself. But when you start managing other people or when you are moving to general management areas, you are the authorizer of the work that other people do. People are looking to you to be the authority figure and I think that is a very significant part of the transition.

Again, this is consistent with those leadership attributes we discussed earlier. People who are able to demonstrate all of those things, particularly presence, integrity and the professional advocacy are able to make a big difference.

Procurious: Do you feel that by moving technical experts into managerial positions we are promoting them towards failure rather than celebrating their specific expertise? 

Karen: I think this is an important point and I really wish we thought of career paths in quite different ways. I think that some people are great technical experts, who are vital to the success of an organization and perhaps we don’t see enough value in their technical expertise. In a sense, we run the risk of shutting down on their brilliance and technical capability by promoting them.

I would like to see organisations promoting and recognising people for their scientific, engineering or procurement expertise without necessarily having the need to move them into big leadership roles.

I think when you are in the front line leading, you still need to be across the functional areas in a very big way. You might even be doing some functional work as well as leading the team. When you get to a general management level, you lose the ability to have deep knowledge into the technicalities of the functional areas.

Promoting experts to managerial roles also presumes that everybody has the same level of ambition and everyone wants to move up the line as far as they can.

Some people just want to be really good at what they do. Some people want to be the best category manager out there. There are a lot of things you can do for these people to ultimately improve their performance and their value to your organisation. You can allow them to have a mentoring role with other category managers, perhaps outside of their own group. They can help to train or advise non-procurement people in category management and how they integrate into the business. It’s a huge opportunity not only for the employee but also for the business.

Procurious: Any final tips for procurement professionals out there looking to continue their progression up the procurement ladder?

Karen: Raise your game; raise your voice. I would highlight the importance of spending the time to focus on what I call the leadership narrative. So often people wander through their careers and things happen or don’t happen, maybe they set goals and maybe they don’t. But the idea with the leadership narrative is that you are thinking about where you want to end your career right now and being more focused on how to move towards that end goal.

Also, I would suggest, you need to understand your own identity, values and core purpose and you should look to create a link between those things and what you’re trying to achieve from a career perspective. These help your to retain your own authenticity and natural approach. Being able to talk about and articulate these things are critical steps for those trying to get ahead.

Read the first part of this article

The Imminent Impact of 3D Printing on Manufacturing

A triple-whammy of recently published reports highlight current and impending trends in 3D printing.

Impact 3D printing will have on manufacturing

The global market for 3D printing is set to grow from $4.5 billion today to $17.2 billion by 2020, finds research by A.T. Kearney.

According to the analysis titled ‘3D Printing: A Manufacturing Revolution’, the 3D printing market – defined as the market for hardware, supplies and services – is set to boom over the coming five years. Today the market is worth approximately $4.5 billion, with Aerospace (including Defence) and Industrial (including Construction) both accounting for18 per cent of the pie, followed by Healthcare at around 16 per cent. The Automotive and Jewellery sectors both represent a 12 per cent market share, while Energy holds 5 per cent, with the remainder taking about 20 per cent of the share.

Benefits of 3D printing

The boom in the application of 3D printing is based on several benefits the technology has over traditional forms of manufacturing, which according to A.T. Kearney can be bundled across five dimensions.

1. Mass customisation – the technology will allow people to create items build to the specifications of customers, with custom-built designs opening up a wealth of possibilities.

2. New capabilities – items can be mass produced without high-fixed capital costs related to specific design.

3. Lead time and speed – the technology allows for = printing in a wide range of mediums on the basis of data templates, benefiting the whole design and production process, ultimately leading to reduced lead time and speed to market.

4. Supply chain simplification – with printers easily deployable and moveable, the whole process can be enacted close to markets, thereby requiring less inventory.

5. Waste reduction – unused base material can be used in a variety of other products, and only what is needed is used, thereby reducing the waste of offcuts, among others.

There’s riches in the 3D material supply chain…

Research compiled by Smartech examines the future of current material supply chains for the key plastics used today in 3D printing.

Many 3D printer firms are racing to fill out their plastic material portfolios and are using them to create competitive advantages. At the same time, major materials companies are also starting to see 3D printing as a profitable niche market worth jumping into now, with the promise of large opportunities down the road.

The quantity and quality of plastic materials available for 3D printing systems are key determining factors in the number of 3D printer purchases.

The report hereby goes into detail on the idea of plastics as a source of competitive advantage for 3D printer firms. Since many OEMs are looking to plastic materials as a source of substantial revenues over the next few years, 3D printing firms have set about acquiring materials to force development themselves. This inexplicably raises questions about the future role of the OEMs – will they even be needed in the 3D printing factories of the future?

A further piece of research taken on by leading 3D printer manufacturer – Stratasys, proves that 3D printing is THE trend of the moment…

Stratasys’ report is based on an independent survey of 700 designers, engineers and executives – 40 percent of whom are employed by companies with over $50 million in revenue.

“We needed to look beyond our factory walls to get a more complete sense of where 3D printing is headed, so we turned to those who live and breathe the technology just like we do – professional users,” said Joe Allison, CEO of Stratasys Direct Manufacturing. “We set out to uncover the common themes among companies who are on the spectrum of larger-scale adoption and integration of 3D printing into their manufacturing process. We’re sharing our findings to help advance adoption and help manufacturers’ maximise the business benefits.”

Trends in 3D printing

The report indicates what applications, business benefits and challenges, equipment, materials and services are capturing the attention of 3D printing’s most committed users – and where their companies will invest. Among the more attention-grabbing of the results are the following:

  • The majority of respondents – representing the aerospace, automotive, consumer and medical sectors – strongly believe more end-use parts will be designed specifically for additive manufacturing (AM) in the future
  • Additive metal use is expected to nearly double over the next 3 years
  • The majority of respondents said that regardless of their company’s in-house AM capabilities, they believe there will always be value in partnering with an AM service provider to augment internal capabilities

“The results may serve as a wake-up call to take swifter action,” added Allison.

Procurement Technology: To Upgrade or Not to Upgrade?

At a recent industry procurement technology conference, I heard a presenter state, quite reasonably I thought, that risk doesn’t begin until you select a supplier.

cloud

As one of those suppliers, I’d naturally argue that the risk in selecting us is lower than our competitors but, still, it is a valid point. It is a given that staying at home less risky than travelling, but only for certain kinds of risk, of course. An outdoor, active lifestyle requires an inevitable degree of caution and hazard awareness, but then again so does sitting on the sofa watching TV.

Thus, while a procurement technology project cannot go wrong until you start, that is no case for lack of action. Doing nothing, can expose your organization to even greater risk in the long term.

So what should you be doing? What should be your approach? A challenge, surely, is when to put a stake in the sand and commit to a particular project in an environment where change and new product announcements are increasing year on year.

Time and again, one hears of companies locked into a legacy system that is too important to ditch and too costly to upgrade. How can that be right?

In the past couple of decades, we’ve seen a big shift in the types of technology solutions that are considered suitable for the workplace. At a time when most large business could only comprehend huge, cumbersome systems, integrated on a very large scale and at enormous cost, those who elected to search for best-of-breed solutions for each requirement, from a range of providers were looked upon as cutting-edge thinkers, almost the avant garde.

And yet, today, attempting to build a robust, transformed, next-decade-ready procurement practice on a mish-mash of different procurement software tools for sourcing, contracts, P2P and SRM is likely to be considered a very risky strategy indeed. More and more businesses are looking for a single procurement software solution to assist in that transformation process.

So, times have changed and seemingly come full circle, but have they really?

I’d say they haven’t. Today’s complete end-to-end procurement technology solutions are as far removed from the ERP systems of 20 years ago as your choice of personal computing device is from that which you were using during the same period.

The only common theme is the notion that you can do everything in one place. The difference is that now you can do so much more than was ever possible in the past.

What drove businesses at the leading edge to seek out best-of-breed solutions was the need for increased power, control and efficiency delivered by innovative technology, something they could definitely not find in the old, megalithic systems.

The advent of a whole new architecture underlying the modern world — with its cloud, wireless and mobile technologies — has made it possible to conceive of one single solution that is powerful and flexible enough to deliver what a global business needs in terms of control and management, but remains agile and responsive enough to keep the modern procurement practice on the leading edge.

We know this, because we’ve built such solutions. Having seen procurement professionals wrestle with the old, monolithic systems and then struggle to make sense of a patchwork of different tools, this really does feel like something quite new.

The most exciting thing of all is the speed at which we can now innovate and address new demands in the ever changing world of procurement. And gone are the days of the business not being able to afford an upgrade. The question today is: cannot you afford not to upgrade?