A Better Way to Manage Road Warriors, and Their Costs

You road warriors are a hardy bunch, aren’t you?

6a00e54ee3905b883301a73e057fe7970

This article was originally published on WordPress.

You spend over a hundred hours a year on planes, take trips on short notice, cross too many time zones, lose sleep, gain weight, get up way early and come home late, and give up more than your share of weekends.

All while being squeezed by travel policies that leave you shaking your head, wondering if the people who approved these policies really, truly understand how hard it is to be a heavy-duty road warrior.

The Travel Friction Concept

Let’s call all this wear and tear you’re taking on “travel friction“.  You get it, right?  The more trips you take, the tougher those trips are, the more you get burned out by being on the road.

Fun fact: Real road warriors, those in the top 10 per cent of all travelers, absorb close to 50 per cent of all travel friction in the average firm.    So you really are in a separate class when it comes to work-life balance challenges, and not surprisingly, for higher risk of quitting your job.

It’s this risk of attrition, of getting burned out on travel and quitting the road, that is the key to a better way of managing all you road warriors.

Old-School Procurement Is The Problem

Procurement folks must address the travel category.  The spend is too big, and the purchase practices too important, for them to ignore.

The old-fashioned way of procuring travel has been – and sadly, still is – to focus intensely on the travel supplier’s costs.  Hammer that airfare down, demand a lower hotel rate, haggle over a buck or two a day for the rental car.

At the same time, procurement knows that travelers need to abide by travel policies that further reduce travel supplier costs.  Things like taking extra connections, flying 12 hours in coach, or staying at inconvenient 3-star hotels…all the things that you road warriors really hate.

Procurement has been doing it this way for twenty years. Call this the “transaction cost” model of managing travel.

New-School Procurement Is the Solution

All we have to do is get procurement to look at the total cost of travel, not just the supplier’s portion.  Specifically, the cost of travel friction.

These travel friction costs come in a few forms: lost productivity, higher health costs, more safety incidents, and the killer – higher turnover.

The good news is that these travel friction costs can all be quantified.  The better news is that procurement folks already get the “total cost” concept.  They use it all the time in other cost categories.  Think computers or cars, and their total cost of ownership.

More Than Just Tiered Travel Policies

Many companies give their frequent travelers a more traveler-friendly policy.  Maybe you get business class on long haul flights and an airport lounge membership. Woo-hoo.

There are many other ways for your firm to reduce the amount of travel friction you take on.  Consider these options:

  • Recognition.  Wouldn’t a simple thank you from a senior exec go a long way to taking the sting out of that last month of road warrior hell you went through?
  • Less Travel.  What if your firm had a travel friction warning light that started to flash when you’ve reached a certain level of travel? Or a proactive way to share your travel duties with a colleague?
  • Better Trips – Safer, Healthier, Easier.  What does “better” mean to you?  Shouldn’t your firm at least know your particular preferences?
  • Better Travel Culture.  You’re a road warrior, not a Navy Seal. Maybe your firm needs to promote a more traveler-tolerant culture.  Some companies do this by discouraging need-to-travel meetings on Mondays and Fridays.
  • Travel Counseling.  A few of you are very likely addicted to traveling.  You and your firm should recognize this, and put some practical options on the table.

Road warriors are a very valuable segment of any firm’s workforce. It’s well worth reducing the friction in this important part of the business machine.

Want articles like these delivered to you by e-mail?  Sign up here.  It’s free, and you can unsubscribe at any time.

Scott Gillespie is the Co-Founder and Managing Partner at tClara, helping travel and procurement managers build more valuable travel programs, as well as the author of Gillespie’s Guide to Travel+Procurement.

‘Rethink Supply Chains’ – The Innovation Challenge to Fight Labour Trafficking

The Partnership for Freedom launched its ‘Rethink Supply Chains‘ competition last week, aimed at providing a technological solution to help fight labour trafficking in global supply chains.

helping-20130926

In International Labour Organisation (ILO) estimates that there are 14.2 million people around the world who are victims of forced labour in industries such as agriculture, construction and manufacturing.

The goods and service provided through these industries are often purchased or used by consumers who are none the wiser, thanks to a lack of transparency in supply chains.

Formed in 2012, the Partnership for Freedom is an American-based public-private partnership, which brings together organisations and governmental departments such as the Department of Justice, the Department of Labor and Steven Spielberg’s ‘Righteous Persons Foundation‘.

The Partnership challenges individuals and organisations to create innovative solutions to human trafficking challenges. In 2013, it launched its first Challenge, “Reimagine”, and granted $1.17 million to fund two winning innovative models, aimed at improving the infrastructure of support for survivors of modern slavery in the United States.

Challenge Two – Rethink

Now, Humanity United, the organisation leading The Partnership for Freedom, has announced the second challenge in its set of three – Rethink Supply Chains.

With a fund of $500,000 for winning solutions, Rethink Supply Chains seeks new ideas, tools, and efforts that use technology to combat and prevent labour trafficking in global supply chains.

The challenge encourages developers, designers, advocates, and innovators to focus on one or more of the following areas:

  • Workers’ Voices: Tools that help workers to share information and foster community, access resources, and report labor violations to businesses, governments, NGOs, or each other in the most safe and secure ways possible.
  • Recruitment: Tools to improve the transparency and accountability of the labor recruitment process, encourage responsible practices for employers and recruiters, and empower workers to more safely navigate the recruitment process.
  • Traceability: Technologies that enable businesses, workers, governments, and NGOs to track, map, and/or share information on commodities, products, and labor conditions in supply chains at high risk of forced labor.

Eliminating Human Trafficking

Randy Newcomb, President and CEO of Humanity United, stated, “The scope of this issue is enormous. We need new actors, new skills, new data, new ideas and new energy to improve anti-trafficking efforts around the world.”

This was also emphasised by Ambassador Susan Coppedge of the U.S. Department of State’s Office to Monitor and Combat Trafficking in Persons, who said, “Forced labor has no place in our global supply chains nor in the goods and services we buy every day.  We look forward to the innovative ideas and designs we anticipate from this Challenge as we seek to eliminate human trafficking from the global marketplace.”

How to Get Involved

All the details you need to know about the competition can be found here. The deadline for initial solution submission is the 13th of December, with finalists being announced during January 2016.

Entries can be submitted by individuals who are resident in the United States, or organisations with the United States as their primary location for business. Rules and Terms & Conditions can be found here.

If you can’t take part, you can support the campaign and follow the competition on social media, via Facebook and Twitter. Also stay tuned to Procurious, as we will publish the finalists next year and keep you all posted with the winning solutions.

If you are thinking about taking part, please let us know! We’d love to tell everyone your story and why you think your solution will help to end human trafficking and forced labour for good.

Supplier Competition Unwinds Japanese Business Culture

Increasing competition in the global automotive market looks to be forcing an end to traditional working relationships in Japan.

1024px-Toyota_Group_Pavilion

A few months ago Procurious published a piece on keiretsu, a Japanese business practice involving very close links between suppliers and buying organisations. These practices are back in the news this week, as Toyota looks set to further unravel some of these links.

To summarise, keiretsu is a business practice that sees companies with overlapping business interests (normally buyers and suppliers) taking a financial share or interest in one another. This practice has traditionally been very common in the Japanese economy, and has been particularly popular within the automotive industry.

However, in the past two decades or so many Japanese organisations have moved away from this business practice and towards the more open supply market competition we are accustomed to in the west. Nissan abandoned its keiretsu policy about 15 years ago to reduce costs. Honda too has moved away from its preference for interlocked supplier relationships with Japanese suppliers.

Toyota sticks with it – until now

Toyota, however, has held firm on its keiretsu policy. Or at least it had until the beginning of this year.

Much of Toyota’s past success has been attributed to the company’s lean supply chain operations and, specifically, its keiretsu business practice. The close relationship the firm had with its suppliers (not to mention their shared financial interests), meant that these organisations were able to work collaboratively and innovate far beyond what was ‘normal’ in more traditional supplier relationships.

Recent decisions, however, suggest that these close relationships are starting to unravel. The most visible sign of this was when Toyota released its new Corolla earlier this year. The best selling Corolla was, for the first time, fitted with anti-crash technology that was produced by a German auto parts manufacturer. Blasphemy in the world of keiretsu.

A shift in capability or in strategy?

All of this poses a question – are Japanese auto parts manufacturers losing their competitive edge, or is Toyota actively looking to diversify its supply chain?

The answer seems to be ‘a little bit of both’. While it does appear that the gap between Japanese parts markers (once seen as the driver behind the powerful Japanese auto industry) and manufacturers across the rest of the world is closing or has closed, the decision to leverage foreign suppliers may in fact be part of a diversification strategy by Toyota.

Speaking on the strength of the foreign supply market, Toyota President Akio Toyoda was quoted as saying, “Competition in the global automotive industry is becoming fiercer”.

It is also clear that foreign manufacturers, like Continental, who supplied the Corolla’s new crash avoidance technology, have closed the gap on Japanese suppliers.

It is thought these organisations are maturing more quickly than their Japanese counterparts, because they have a broader customer base and a wider geographic spread, opening them up more opportunities, innovations and economies of scale. Japanese suppliers have missed this exposure through their arguably insular relationships with one (or very few) buying organisations.

Perhaps driven by this increase in global competition, Toyota has, over the last year, looked to diversify and unravel some of its interlocking supplier relationships. In April, the automaker took the bold step of installing 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 role at Aisin was to slacken the ties between the business and Toyota, and look to make the organisation more competitive in the global market, a move that was thought to be beneficial for both Toyota and Aisin.

Where do you think the balance lies for Toyota? Open markets or close supplier relationships? Could western Businesses learn something from the keiretsu mantra?

The Song Remains The Same

What can John Lewis’ Christmas campaign teach us about Procurement?

11321152-large

The well-orchestrated PR ‘rumours’ were confirmed when John Lewis’ Christmas campaign was launched, sound-tracked by a cover of a classic song – “Half The World Away”, written by Noel Gallagher of Oasis.

On cue, industry pundits considered if the brand’s longstanding music strategy still works, or if consumers will tire of slow, breathy female-vocal renditions of songs whose original versions had more bite. Retail analysts will no doubt pore over John Lewis’ Christmas trading figures in the New Year; this may provide an answer.

The Cost of Music

For the Procurious community, the key issue here is ROI. Will investment in the campaign, of which music is a key part, deliver a quantifiable uplift in profits? It’s a question I’ve asked marketing directors when considering the cost of music recommended by their agencies.

In advance, it’s almost impossible to know – and in hindsight, few brands carry out the post mortem. If you’re in marketing procurement with a remit to support your marketing colleagues, where do you begin?

At a presentation to ISBA members earlier in the year, it was clear that many marketing procurement executives didn’t feel confident to challenge their agencies on music costs. A common concern was:

“I just don’t know which questions to ask”.

Typically agencies present a single figure for music in production estimates with no breakdown or explanation of how the deal was negotiated. Without an understanding of the fragmented nature of music rights, marketing procurement teams are in the dark. So, here’s some light on the issue:

Separate copyright exists in

  • The song aka “publishing rights”, and
  • The sound recording aka “master rights”.

These are usually controlled by respectively by music publishers and record labels. Brands, or their agencies, are solely responsible for securing approvals and negotiating sync licence fees before any usage takes place in a campaign.

Jargon Alert!

‘Sync’ (short for synchronisation) is the act of dubbing music to moving images.

The sync licence approval chain often leads back to the same people when the songwriter and artist is the same person. Had John Lewis wanted to use the original Oasis recording of “Half The World Away”, the sync licence requests would have been as follows:

  1. Song/Publishing Rights via music publisher: SonyATV Music Publishing > Artist Management > Noel Gallagher (songwriter)
  2. Sound Recording/Master Rights via record label: Sony Music > Artist Management > Noel & Liam Gallagher (artist: Oasis)

In this instance, Noel Gallagher would receive the sync requests via two avenues, his music publisher and record label.

Value Versus Price

Here’s where value and price come in. Would Noel Gallagher place a greater value on his song or his recording?

In practice, the music industry prices them at parity using Most Favoured Nations (“MFN”) – an upwards-only price equalisation device. “Half The World Away” reached number 3 in the UK single charts in 1994 and became the theme song for BBC sitcom “The Royle Family”. Mr Gallagher would therefore place a very high value on both song and recording.

However, the new John Lewis campaign doesn’t use the original Oasis version. Instead, it follows the established strategy of using an emerging artist to record a new cover version of the song. In this instance it’s a Norwegian singer called Aurora, signed to Universal Music imprint Decca Records. So how does the approval chain look now? The song remains the same, but the recording is different.

  1. Song/Publishing Rights via music publisher: SonyATV Music Publishing > Artist Management > Noel Gallagher (songwriter)
  2. Sound Recording/Master Rights via record label: Universal Music > Artist Management > Aurora Aksnes (artist name: Aurora)

What does this mean for Procurement?

As we’ve discussed, Noel Gallagher will place significant value on this song. His managers will dictate that his music publisher demands a premium price for the sync licence. Remember that Mr Gallagher didn’t write his song to be used in a commercial, and he doesn’t need the money or profile.

In contrast, the artist Aurora will greatly benefit from the exposure in the John Lewis campaign. For the artist, her manager, and her record label, the value is in the promotional opportunity, not the sound recording. This will be reflected in a much lower-priced sync licence, provided that the record label waives any MFN provision.

Key Learnings

If your agency presents you with a single budget figure for a licensed music track, don’t just accept it, ask these questions:

  1. Is it an original artist recording or a cover?
  2. If it’s an original artist recording, is the artist also the songwriter?
  3. Is the artist proven to be famous?
  4. Is the song or songwriter proven to be famous?
  5. Which music publisher controls the song? (It can be more than one)
  6. If the recording is a cover, is the cover artist famous?
  7. How will the cover artist benefit from awareness through the campaign?
  8. Can promotional value be traded against sync licence price?
  9. Will the record company who controls the cover recording waive MFN?

Whilst these issues are a whole world away from the schmaltzy, perfect Christmas conveyed in the new John Lewis campaign, smart marketing procurement executives can take control of price by better understanding value and the complex music rights landscape.

Although the song remains the same, alternative cover versions can offer cost efficiencies if you know the right questions to ask.

Richard Kirstein is a Founding Partner at Resilient Music, which aims to shed light on the complex landscape of music procurement, and delivers a smarter way for brands and agencies to buy music talent and rights.

Are Price Wars Impacting The UK Food Supply Chain?

The price war between supermarkets in the UK is frequently referred to as a ‘race to the bottom’ . But as the major retailers fight for market share, suppliers with already wafer-thin margins are the ones feeling the price war’s impact hardest.

supply chains

A report released last week by the National Farmers’ Union (NFU) in the UK, argued that, while trying to win customers, retailers were returning to “damaging short-term practices“, and heaping pressure on their producers and suppliers.

Numerous suppliers have argued that retailers have begun to prioritise price over quality and service, and trying to recover their decreased margins across their supply chains.

Over Supply Issues

Compounding these issues are two other factors – over supply and aesthetics – something that farmers and other industry stakeholders, including chef Hugh Fearnley-Whittingstall, have called out retailers on.

Although bound in some cases by EU Regulations on fruit and vegetables, many retailers are rejecting high-quality food (usually vegetables) as “imperfect”, even if the food in question is in good condition.

Around one-third of fresh food produced in the UK is never eaten, with vast quantities being rejected on cosmetic grounds. As well as the issue of rejection on quality grounds, supermarkets have also been accused of wasting tonnes of food that is over-ordered, so that they can have full shelves for customers.

Financial Distress

An estimated 1,500 UK food and beverage manufacturers in the UK are currently classed as suffering from “significant” financial distress. Although this figure has fallen by 4 per cent during the second quarter of 2015, it still represents a figure three times higher than in the same period 2 years ago.

Experts believe the cause of this distress is linked to a readjustment to supermarkets’ lower price strategies. With suppliers under pressure, industry professionals are calling for change in order to ensure a future for all parties.

Judith Batchelar, Director of Brand at Sainsbury, has argued that there needs to be a more “joined-up” approach across the supply chain, with collaboration between all the parties and steps taken to integrate the latest technologies and information systems.

Although admitting that Sainsbury itself had a long way to go in this respect, Batchelar argued that this was the best way to create long-term sustainability, and help to balance the inherent supply and demand driven industry fairly.

Fresh Strategies

In the US, retailer Target is also addressing its supply chain strategy for fresh produce in the wake of major stores closures across North America this year.

The food supply chain, described as a “Frankenstein” system by Target COO, John Mulligan, is seen by the organisation as a key element in its battle to regain its market share.

However, it’s not all bad news in North America. US-based agriculture co-operatives have announced record income and revenue figures for 2014, with incomes up 16.4 per cent and a total of $246.7 billion revenue for the same period.

The figures are credited to an increased reliance on co-operatives, increased involvement in communities and greater number of producers joining one or more co-operatives in the past year.

It is hoped that the success of the co-operatives can be repeated in the UK, increasing the importance of the co-operatives and bringing the same collaborative strategies supermarkets are talking about into practice and achieving tangible benefits.

Do you work in procurement in retail or for a supermarket? We’d love to hear your experience of these issues, as well as how you might have solved them. Get involved on Procurious.

In need of some news to share with your colleagues over morning coffee? Look no further than what we have for you…

Tata Demands Suppliers Cut Prices

  • The Indian Steel Giant, Tata, has been accused of “bullying” tactics towards suppliers by demanding a 30 per cent reduction in prices
  • The company recently wrote down the value of its UK assets, and has made over 2000 people redundant in the past few months
  • A letter signed by Lorraine Sawyer, procurement director of Tata Steel Long Products Europe, was issued to the whole supply base, initially asking for a 10 per cent price reduction across the board
  • The letter goes on to ask for “contribution from all…suppliers” and implies that suppliers who do not comply may end up losing business

Read more at The Telegraph

Nurse Saves NHS Trust “Thousands”

  • A nurse has helped save tens of thousands of pounds in Plymouth – by introducing new and more efficient equipment.
  • The Senior Sister, who also acts as an Clinical Procurement Manager, has saved Plymouth Hospitals NHS Trust thousands of pounds over a 6-week trial period
  • Michelle Winfield said the key to saving money was “involving clinical staff in the choices and changes”
  • James Leaver, category manager for the trust, said, “We are seeing a real sea change in attitude with people no longer taking the historic view that procurement and finance are ‘imposing’ changes on clinical staff.”

Read more at The Plymouth Herald

BHP Billiton Shares Plunge Following Dam Disaster

  • Shares in Australian mining giant BHP Billiton have fallen sharply following the collapse of two dams at a co-owned iron ore mine in Brazil
  • What caused the dams to break is unknown, but it caused a wave of water, mud and debris to be released, engulfing nearby villages and killing at least 2 people
  • Shares in the company fell by 3.5 per cent on both the Australian and UK stock markets on Monday morning
  • The disaster has prompted calls for better regulation on the mining industry in Brazil, which is one of the country’s leading sources of export revenue

Read more at The Guardian

Obama Signs Illegal Fishing Laws

  • U.S. President Barack Obama has signed the Illegal, Unreported and Unregulated (IUU) Fishing Enforcement Act
  • The legislation includes a number of provisions preventing illegally harvested fish from entering the U.S. and supports efforts to achieve sustainable fisheries around the world
  • Currently, U.S. fisheries law focuses on at-sea or dockside enforcement of domestic fishing operations and does not provide the tools needed to address imported seafood and fishing violations
  • It is hoped that the new laws will ensure that both the economic and environmental sustainability of the U.S. Fishing Industry are protected

Read more at Maritime Executive

Stopping Redlining in its Tracks

How the new wave of contract management software is reducing time spent negotiating.

Drafting-Contracts-Callagy-Law

Is it possible to use data analytics and clause standards to make the contract negotiation process more efficient? Certainly there are situations where standard contracts are routinely used, and it’s undeniable that this saves time and money.  For example, imagine how much longer standard real-estate processes would take if each time an agreement had to be drafted by scratch.

However, there are also many situations where individual situations call for the drafting of a unique agreement.  Lawyers may argue that, by nature, the art of drafting contracts is so complex that it would be nearly impossible to use any form of analytics to assist in the process.  But the new wave of contract drafting and management software is seeking to defy that argument.

Kingsley Martin of KMStandards (publisher of ContractStandards) suggests there are three main metrics that define the success of a contract negotiation process.  All of these metrics overlap to some degree.  These are:

  1. Quality is defined by such things as how well it achieves its purpose, how much consideration it generates over time, its completeness and accuracy;
  2. Cost is the cost of the negotiation and administration including all expenses related to litigation and disputes; and
  3. Time spent on negotiations, administration of the contract including the time required to handle litigation or disputes.

track_changes

Newer technology is seeking to help optimise all three of these aspects of the contract management process by measuring metrics on contracts for various purposes.  An analysis of this data could lead a system to automatically produce contracts with optimised terms – i.e., the terms in the past that have required the least amount of time to negotiate.

It could even predict what agreement parties will arrive at for the sale or purchase of a product and/or service. This new technology will stop redlining in its tracks!

What are your thoughts? Do you believe that standard contract language can help reduce unnecessary negotiation? Can you think of any other ways technology could work towards optimising the contract management process?

ContractRoom, home of #HappyContracting – making the world more agreeable one happy contract at a time. Negotiate less, Agree More! Contact us for a free demo @ www.contractroom.com.

Procurious Big Idea #47 – Measuring Social Values in Procurement

Olinga Ta’eed, Director at the Centre for Citizenship, Enterprise and Governance (CCEG), talks about how businesses need to measure themselves on their social values driven by procurement.

While previously intangible, social values can now be measured through big data, sentiment analysis and social media.

See more Big Ideas from our 40+ influencers

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

All for One, Innovation for None

Another public procurement price analysis article has made national headlines recently, found here on BBC News.

police

Many thanks to Market Dojo for giving Procurious permission to republish this article.

The Home Office conducted a study into police procurement trends across 20 common items including batons, uniforms and helmets.

I haven’t read the Home Office study in detail, but these kind of reports can err on the side of rudimentary:

Humberside bought police helmets for more than £43 each while most other forces acquired them for under £30.

This can indicate a savings potential and is undoubtedly a good place to start your evaluation for cost reduction opportunities.

However when you simply compare two purchase prices, rarely, if ever, does the analysis also delve into key contractual differences such as payment terms, rebates, catalogue pricing discounts, minimum order quantities, annual purchase volumes, inclusion of delivery costs, what delivery service levels, product warranties etc.

Then you have the question on whether the specifications are the same.  Perhaps Humberside has identified a more costly product that leads to a 20% better safety record from head injuries.  Might that not justify the additional cost?

There is a long perceived view that rationalisation and aggregation leads to cost reduction.  For example, in the same article Policing minister Mike Penning was quoted:

“For too long the police have approached the market in a fragmented way, buying equipment in small amounts and to varying specifications.

“It makes no sense for forces to buy separately when money can be saved if they act together.”

Bigger procurement is not always better procurement

Interestingly Spend Matters UK recently re-circulated an older post of theirs outling how bigger procurement is not always better procurement.  Please do have a read as it provides excellent insight that we won’t duplicate here.

What we’ve seen is that many of our clients run reverse auctions on aggregated volumes, rather than spot-purchases.  They are very successful in doing so.  That said, even very low value auctions of a few thousand pounds have lead to 30%+ savings, so bigger isn’t always better in our view too.

Large spend values attract large suppliers with the notion being procurement teams can exercise their leverage and use economies of scale to secure better pricing.

Lower spend values attract smaller suppliers and generally there are a lot more of them in the marketplace, which can equate to increased competition and better savings.

Perhaps the price differences seen with the police, assuming they are not associated with contractual or specification issues, are less to do with failure to aggregate demand and more to do with ineffective negotiations for their own requirements? 

One step forward, two steps back

One adverse side-effect to bundling up contracts into an aggregated demand is that it diminishes competition.

Taking say £200m of spend that is today fragmented across many hundreds of suppliers and bundling it into a single contract prohibits SMEs from retaining business.  As a result some may perish whilst others downsize.  The large company that wins the contract swells significantly to cope with the demand whilst other large businesses (if there are any) stay as they are or also downsize from losing their portion of the fragmented spend.

Fast forward a year and the market only has one real candidate who can cater for the demand – the incumbent.  This becomes a very poor market to negotiate in.

And so the cycle continues whereby it is decided to fragment the contract into smaller packages to increase competition, except this time there isn’t as much liquidity.  So we’re back where we started except with worse market conditions.

Innovation triumphs over imitation

As we’ve just noted, consolidated contracts diminish competition.  With less competition, there is less imperative to differentiate.  There will be fewer SMEs in the market and they are typically regarded as the key source of innovation with their agility and drive to increase market share.  Local police authorities will have their hands tied and won’t be able to engage with the SMEs and so those remaining will have little incentive to innovate.

Furthermore, the other suggested strategy in the BBC article was to standardise the products. This again reduces innovation, as the product spec. would be based on what already exists, not would could be.  Once that spec. is agreed, the market is closed out to new ideas.  This contradicts with the relatively recentreforms to the EU Procurement Directives.

So what should we do?  

We should be focusing on driving the market forward and negotiating effectively within that market.  A fragmented market can be your best friend, not your enemy.  Procure on best value, not just best price.  Don’t focus on Purchase Price Variance but on lifetime costs.  Improve through innovation.

We could go on but there’s a risk we’re sounding like a Baz Luhrmann song!

Hopefully we make ourselves clear but more importantly, what do you think about this suggested police procurement strategy?

Market Dojo is a pioneering software-as-a-service (SaaS) company that offers professional, intelligent and easy-to-use online negotiation software and accessible eSourcing software. Find out more at www.marketdojo.com.

10 Career Influencing Women in Procurement – Part 1

As a woman in procurement – what would you do if you weren’t afraid? Would you ask for more from yourself, your partner, your boss, your colleagues, your suppliers?

Women-in-Procurement-2015-conference-Australia-Melbourne-homepage-web-image

Probably. So, why don’t you? Is it down to a lack of confidence?

Confidence is “in alarmingly short supply” for women.

According to the book ‘The Confidence Code’, the main reason women have lower confidence is because they tend to lack self-belief. The book’s authors, Katty Kay and Claire Shipman, found that women need to stop worrying about failure, stop second-guessing themselves, and put less emphasis on how others might perceive them.

Women need to stop worrying that they cannot succeed but instead start taking action and risking failure. By not believing that you can succeed, you are less likely to even try.

Embracing Your Ambition

This week I was a guest at the ProcureCon Europe ‘Women in Procurement’ Breakfast in Berlin. The very impressive Melani Wilson Smith chaired the breakfast, pushing the attendees to share their experience and get the most out of our short time together.

Melani is a perfect example of a successful woman in procurement. Currently Chief Procurement Officer for North America & Global Biscuits at Mondelez International, Melani has worked globally for other big names such as Pfizer and Proctor & Gamble, while still being an active member of her community in New Jersey.

The conversation over breakfast touched on the common challenges of influence and engagement. One of the key messages that resonated for me was that women in procurement needed to “create the courage to embrace your ambition”.

Women are ambitious and work hard, but they need the confidence and courage to follow through and create the career they deserve.

My Influencers

While I listened to the dialogue, I couldn’t help thinking about and reflecting on the women who have supported and influenced me during my career.

I see my career in two distinct halves – before and after I became a mother. This week, my focus is on the first half of my career

Before I had children managing my career was pretty straightforward. I got a great education, worked hard, kept my bosses happy (well, most of the time) and was focussed on continually presenting new ideas and ways to get things done.

These are some of the women who made a big impression on me, as well as having a major impact on my future.

1. Christie Breves

Christie was my first female boss in procurement. She had a demanding focus on detail, which was a very important learning point for me – the devil is in the detail and your numbers need to be indisputable.

Her formula is evidenced by her successful career – more than eight years as CPO at Alcoa, and now more than two years at US Steel. Christie had a young family when I worked for her, but – of course (as you do pre-children) – I didn’t even think about this at the time.

Christie is a legendary woman in procurement – and anyone who gets the chance to meet her should take the opportunity.

2. Charmayne Rose

Charmayne may be surprised to make this list, but if it wasn’t for her telling me (in no uncertain terms) over lunch when I was 33, that I had better get started on having children, I would probably not have considered this for another decade!

I was too focused on my new company, and having too much fun to focus on something so serious. But her conversation prompted me to research the ageing process and its impact on fertility. I got the message and two years later had my first son.

While many of you might be thinking “too much information…”, this is a very important timeline for career women to keep their eye on. It is too easy for time to slip by!

3. Cindy Dunham

Cindy naturally assumes the leadership role wherever she is operating. She listens and respects the debate, then provides the ‘mile high’ strategic view, and considers solutions that will benefit the community.

I have always admired the way Cindy delegates and empowers her team. This allows her to manage her calendar to focus on the things only she could do. As women, in particular, I think we try to take on too much, and that then often means that we are over-stretched and under-resourced.

Cindy travelled the world with her role with Rio Tinto and still managed to keep the home fires burning.

4. Sue Steele

Sue is the most ‘statesman-like’ female leader I have met. Sue has succeeded in a very male-dominated field – engineering services – running the Operations team before moving into Procurement.

She reports to the CFO and is on the governance board for Jacobs’ major global clients. She now has two grown children – the stories of which have always given me great perspective!

Whenever I meet or speak with Sue she has an amazing way of making me feel very empowered, which is always much appreciated!

5. Antoinette Brandi

Antoinette is currently a Member of the Victorian Government Procurement Board, and has held some very senior procurement roles in tough male-dominated industries – defence, mining, contracting, and railways.

She was also CEO of the IPMM, before CIPS came to Australia. As well as being Georgia Brandi’s Number 1 mentor (aka mum), Antoinette has always supported me.

It is hard to think of something I have done that hasn’t in some way been acknowledged by Antoinette via an email, a call or a LinkedIn message. Priceless.

My Challenge to You

I’ll leave you with a challenge for the coming week, before the second half of my list is published.

Have a think about the people who have influenced your career – think about why that is, and what you have done to act on their advice. Can you offer this advice to someone you know?

From Novice to Master – Upping Your Social Media Game

Social media is disrupting the world of communications. It’s now just as easy to speak to someone on the other side of the world, as it is to speak to someone on the other side of the room.

real-estate-technology-news-how-eclincher-can-up-your-social-media-game_1430_40070820_0_14115342_960

Social media is no longer just for your personal life. From marketers who can reach consumers quickly and easily, to sales people able to speak to customers directly, the platforms are becoming increasingly valuable for professionals too.

Procurement is playing catch up, but the possibilities for the profession on social media are endless. Procurious wants to help more procurement professionals get involved with, and leverage, social media to help with their day-to-day work.

For the last year and a half, the Procurious team has been running workshops up and down the UK, as well as in Australia, highlighting all the ways procurement can make social media a valuable resource, allowing them to interact with stakeholders and suppliers, keep abreast of market trends and change the image of ‘brand procurement’.

How Procurement Measures Up

It wasn’t until recently that Procurious decided that it needed a tool to measure how professionals were doing on social media. We know how much procurement leaders love a good KPI, so we created something that individuals could use to keep track of how they were progressing.

Many of you will have heard of Klout, the most commonly used social media audit tool. Klout measures both personal and professional platforms, including Foursquare, Facebook, LinkedIn and Twitter. The site is relatively easy to use, but it is hard to understand how your score develops.

Procurious took the theory behind this tool and created its PRISM (Procurement Relationships and Influence on Social Media) tool. PRISM takes into account the three platforms we feel are most readily leveraged by procurement professionals: Procurious, LinkedIn and Twitter.

We look at a number of criteria across all three platforms, including profile completion, number of connections, level of engagement and participation and publishing of original content. Where PRISM differs is that it also takes into account offline influencing activities including conferences and training courses attended.

Levels of Influence

Screen Shot 2015-11-03 at 16

Individuals are scored out of 100, and matched against one of four Influencer Levels:

  • Novice – Novices are just getting started on social media. They may have profiles on a couple of platforms that need spruced up, and they haven’t yet expanded their social media network.
  • Builder – Builders have found their feet on social media, have built good profiles, and have expanded their social networks. Builders are still searching for their voice on social media, but are generally good at sharing content.
  • Influencer – Not only have these individuals found their voice, but they are also actively participating in the conversations on social media. Influencers post content most days, ask and answer questions, and maybe even moderate groups.
  • Master – Well done! As a Master, you are an avid social media user, posting your own thoughts, sharing other people’s posts and creating original content on the platforms or maybe your own blog. The chances are very good that you are also a keen networker offline too.

Up Your Game

Even without a score, you’ll should have a rough idea of where you sit on the scale. Don’t worry if you think you are a ‘Novice’ – this is where most procurement professionals are!

The good news is you can take some really easy steps to up your game and your score at the same time.

If you don’t know where to start, find the platform that you feel most comfortable with and build your profile. If you need some inspiration, see what Tania Seary has to say about getting started and your next steps.

If you think you’re in the Builder or Influencer level, think about what groups you could join on Procurious or if there is a discussion you could either start or contribute to.

Done all of that? Good work. But even if you think you are a ‘Master’, you shouldn’t rest on your laurels. If you have a story to tell, or an idea for some content for Procurious, drop the team a note and we can chat it through. We also have an exciting article on getting started with blogging coming up that you don’t want to miss.

Workshops

If you want to get the most from PRISM, and get your colleagues involved too, the best way to do this is to get in touch with Procurious and organise a workshop for us to come and show you it first hand.

 

We can talk you through how the tool and scoring works, get you set up with initial scores and give you and your team some great tips and tricks to build both your individual, and organisational, social media brand.

Don’t get left behind on social media – take these easy steps, and before you know it, you’ll be well on your way to mastering the art!