3 Ways To Make It Big In Procurement and Supply Chain

Tom Derry, CEO – ISM shares his three top tips for early-career professionals who aspire to be a CPO or Head of Supply Chain in a leading organisation.

The next generation of CPOs and Heads of Supply Chain will need to be “next-level” talent.

“It’s easy to point out a few critical success factors for people who have risen to the very top of the profession,” explains ISM CEO – Tom Derry.

In this article Tom shares his three top tips for early-career professionals who aspire to be a CPO or Head of Supply Chain in a leading organisation.

1. Align yourself with the best in the business

One of most important things to do during the early years of your career is to align yourself with the best talent out there. “If you’re just getting into the field or are early on in the field discover who has the best reputation, who’s the best leader and who’s regarded as being leading-edge and running a great organisation” Tom suggests. It’s also advisable look at the company’s reputation. “It’s clear that certain companies have created an awful lot of talent in our profession, disproportionately more talent to other companies.” So find those great leaders, at those great companies and that’s going to be a launching pad for you.”

2. Be courageous

“There are a lot of metrics of dubious value that we often pay attention to in the profession that have outlived their usefulness.” Tom says. He advises professionals to try and link what they’re doing day-to-day with what’s driving value for the firm – whether it’s bringing new products online, introducing new features to new products, driving top line revenue growth or increasing earnings per share by reducing cost. “Speak the language of the business and link explicitly what you’re doing to driving those kinds of outcomes.” This will help you to gain respect because that’s how we keep score in business and those are the measures that matter the most.”

3. Be competitive

“Businesses are about competition,” asserts Tom. “It’s about competition between firms but, frankly, it’s also about competition within the firm to gain resources to win the opportunities for promotion and advancement.” Tom believes it’s important to understand that you are competing, you’re being regarded by your superiors in the firm in terms of your output and your productivity. “You’re in a competition for advancement – maybe it’s advancement within the firm, maybe it’s advancement in another firm but you have to recognise that and put your game face on every day. As they say in sport: leave everything on the field. At the end of the day someone may outcompete you if you’re not taking that approach.”

Part Five of Tuesdays with Tom is available now. Click here to sign up and hear ISM CEO Tom Derry discuss top tips for aspirational early-career professionals, how high profile leaders can become talent magnets in supply management and the latest data on salaries.

Putting The ‘I’ In D & I

By having an inclusive corporate environment for people we can make a change and improve the way society works…

In today’s workforce, diversity has become a buzzword, with organisations increasingly communicating its importance through their advertising and core business values.

But what does diversity mean, why is it important, how do you achieve it and, once you have it, what do you do with it?

Joelle Payom, Global Strategic Sourcing & Vendor Management Lead explains that there is an enormous pressure for organisations to hire people that are different. But alongside that moral pressure to ‘do the right thing’ is a very strong business case. “A UK report revealed that the British economy could be boosted by as much as £24 billion if black and minority talent was fully utilised . When you have a diversified workforce you have a broader [talent pool] who are able to bring different ways of working, different ways of dealing with issues and can provide greater innovation.”

Putting the ‘I’ in D & I

As Joelle points out, there is no point in building a diverse workforce if it is not nurtured into being an inclusive one. “To reap the benefits of a diverse workforce it’s vital to have an inclusive environment where everyone is treated equally, feels welcome to participate and can achieve their potential”

Diversity = The What

A mix of diverse types of people

Inclusion = The How

The strategies and behaviours that welcome, embrace and create value from diversity

“What is really at stake is not diversity, but inclusion. How do you make sure your diverse workforce will generate the expected benefits – that increased profitability – no matter who they are. You cannot simply integrate a human being [to the workforce] because they come with their own character and uniqueness.

“How do you ensure [everyone is able to] give their best to the company?”

  1. Let People Be Themselves: It is the employer’s role to ensure that all employees, no matter their specific characteristics, can be themselves. “In the corporate world we all have to fit in but fitting in doesn’t mean you forget who you are.”
  2. Equity – The entire employee base should be given equal chances whether that’s an equal chance to be promoted, equal pay or other opportunities within the organisation.
  3. Intersectionality – A black man, who is a wheelchair user and identifies as gay might endure multiple forms of discrimination at the same time. To better include this person it doesn’t make sense to only address one of these factors – you can’t foster an inclusive environment without addressing everything. D & I teams often isolate their efforts on one particular minority group but the experience of a white woman might be very different to that of a black women, and that needs to be addressed when it comes to developing D & I strategies and policies.
  4. Safe space – Employees should be encouraged to speak up about these issues without fear of retaliation. “Organisations must ensure their people management approaches don’t put any group at a disadvantage.”

“What I want people to take away is that diversity and inclusion (D & I) is not only for women or for people of different ethnicities or sexual orientation. It is for everybody. D & I , which is much more important than diversity, means that we need to provide each human being with equal treatment in the corporate world. By having an inclusive corporate environment for people we can make a change and improve the way society works.”

Joelle Payom, Global Strategic Sourcing & Vendor Management Lead

Procure with Purpose

Procurious have partnered with SAP Ariba to create a global online group – Procure with Purpose.

Through Procure with Purpose, we’re shining a light on the biggest issues – from Modern Slavery; to Minority Owned Business; and from Social Enterprises; to Diversity and Inclusion.

Click here to enroll and gain access to  all future Procure with Purpose events including exclusive content, online events and regular webinars.  

It’s Procurement’s Own Fault That The Business Thinks We’re Only About Price

If you’re forever complaining that all your stakeholders want from procurement is cost reduction, consider this: maybe it’s your fault. Here’s how to fix it.  

Over the years I have seen and agreed with a tendency in the area of procurement and supply management about the movement to become a broader function; one that goes beyond comparing prices only, and becomes a business strategist.

At the day-to-day level, the organisation has goals that when cascaded to Procurement could be understood as “only” about cost reduction. One consequence of this is that Procurement’s work and recommendation revolve much of the time around pricing. And this makes sense, as it is the most intuitive strategy to bring benefits to the company, and it is also the easiest way to measure impact (at least to the eyes of our stakeholders).

Considering that we as a function are trying to evolve, a consequence is that we feel that we get classified as professionals that can only talk about the prices from suppliers. This situation puts a glass ceiling on what Procurement can do, making it harder to gain relevance in the wider organisation.

But, which came first? The chicken or the egg?

It’s our fault

My theory is: could it be caused by us? Could it be that we ourselves are continuously reinforcing the cycle in which we always talk about price and then the organization talks with us only about price as well?

Competitive pricing does not appear from thin air, especially in organisations with mature procurement functions. These organisations require that the Procurement Manager (the agent that needs to make two different organisations “talk and function together”), make use of levers such as strategy tools, supply chain tools and people tools (mainly) to achieve what is regularly expected: a lower cost.

And how many of those levers are about price only?

If Procurement wants to become more relevant in the organisation, it needs to build over time the tone of the conversation, steadily broadening the decision analysis and variables and incorporating into the recommendation more business broad perspectives: create a competitive advantage, consider impact to society and environment, supply chain efficiencies, changing the category structure, and so on.

To understand if you are a Procurement professional who is capable of growth in the organisation and who will one day become a business strategist, growing at the same time the value of Procurement as function, take the first step: make a self-assessment.

Looking beyond price

Take your most successful procurement recommendation, and delete all the components that are price specific, or are directly linked to price (e.g. spend levels, price savings, price structure, price benchmarks, etc.). How much is there left?

If there is not much left, it means you have work to do to steer your business conversations into broader business impact topics. I present below a couple of ideas that could be used to initiate and maintain the transition to procurement contributions with strategic added value to the business:

  • The first one is not an actual recommendation because it is playbook: do the procurement homework. Create the procurement framework for your category including supply market strategic analysis, decision/evaluation matrix, category analysis and positioning, and all relevant topics that revolve around a strategic process. To change the game, you need to be aware of how is currently played.
  • During your competitive procurement processes, conduct a negotiation round (or at least a supplier meeting) without talking about the price (or similar); challenge yourself to identify the differences between suppliers and to identify the value buckets that are hidden behind the price tag. By simply broadening the topics in conversation, the chances for a successful negotiation increase (as you may increase the negotiation topics). As a result your procurement mindset will kick in and will guide you to new and better strategies.
  • When making presentations, ensure the information you present relates directly to your strategy: it clutters your work if you present supplier total revenue, number of employees or location, if these are not directly related to a component of your strategy. At the same time, use graphics to build momentum to present your recommendation; if the intention is to present which supplier is bigger (assuming that the aim is to communicate that bigger is a proxy for better), then presenting a code or a ranking of the “bigger supplier” could suffice to communicate your idea (details could always go to annex).
  • Show others how you expect the variables of your presentation to play out in one years’ time. This means: Do you expect the same supplier to still be the most competitive at contract exportation?  What level of technology compared to peers do you expect the supplier to own at contract expiration? Would the supplier be better prepared to collaborate with the organisation? Which supplier may have a change of ownership or acquire new assets?

Business mindfulness is created over time. By initiating an own process of “thinking  business” instead of “thinking price” while producing our daily procurement outputs, not only are we capable to implement more resilient and value adding solutions, but we enhance the mutual benefit relationship of our function with the business, moving away from that “price manager” tag that Procurement may have, and eventually opening up the space to create more opportunity for procurement professionals.

To give Procurement a seat on the table we also need to be leaders that develop people. It is important to say that these ideas of “talking about everything except price” is a technique that should be used not only with self, but with suppliers and with junior team members. Giving them the challenges as proposed here becomes a tool for their development, challenging suppliers to be better, and help your people become more rounded business professionals.

We should embed in our mindset that every Procurement project is an opportunity to improve as a business professional for the benefit of the business. I expect the ideas shared on this piece to trigger the process of transition from price managers to business strategists.

Blockchain: Procurement’s Secret Weapon

Procurement will be the single largest instrument in the world to change the world…

“Frankly procurement is at the same level, in my eyes, as auditing, accountancy and that level of excitement. There’s more excitement in the hashtag #Birdsarentreal – because people believe in that more and with more emotion than this.”

Olinga Taeed became the world’s first Professor in Blockchain and Social Enterprise at Birmingham City University in 2018. His research explores how blockchain can be used for social good, focussing on studies into methods to alleviate problems and provide significant intervention into society.

And when it comes to procurement and the future of the profession, he doesn’t mince his words.

“No one grows up saying mummy I’d like to be a CPO,” he explains. “And that’s because we value non-financial value. We grow up wanting to do things that have value in society – things to do with life and sentiment, we want to change the world.”

The Power of Procurement

“Doctors save one life at a time. In procurement, we can save or kill thousands by one decision”

When you say I will knock 3 per cent off my supply chain budget, somewhere in that chain some people will enter into slavery conditions

We now know that 32 people commit suicide manufacturing iPhones in China every year.

800 people might die in a fire making clothes for a retailer.

“In procurement we have the power of life and death and that is a major responsibility.”

Changing the world

Blockchain could enable procurement to change the world by bringing our values back into the workplace.

“In institutional life we often succeed in stripping out any kind of intangible value. But this attitude doesn’t occur in real life, only within institutions.”

In our own lives we use our personal values to procure things “I’d like to have products that are aligned to my values, I’ll use this coffee shop not that one, I’ll eat this ice cream but not one from that place, price is this important to me but slavery is this important. We talk about our feelings”

Blockchain will allow procurement professionals to use our values as a mechanism for procurement, just as we all do in our own lives.

Blockchain can put into a ledger an entire supply chain, which means at the point of sale, just as you would see calories on a food product, you can decide whether to buy it or not to buy it based on the values of the supplier. You are given all of the information and can make a choice based on that.

Olinga explains that AI will help procurement in a similar way “these are my values go and find me products that are aligned to my values – don’t pick companies or suppliers where I know environmentally they aren’t good.”

Organisations used to readily give discounts to NRA (National Rifle Association) members but all of that changed because our values changed, companies stepped back and procurement changed. Using blockchain, procurement professionals can procure against a set of corporate values – “it’s for me to buy products from suppliers that are aligned to those values.”

Olinga Taeed speaking at Big Ideas Zurich

“My honest belief is that procurement will be the single largest instrument in the world to change the world – children will say they want to be a procurement officer because they will want to change the values of the world – what we buy, what we eat, what we sell, the values by which we transact. Blockchain and AI will change our processes dramatically.”

Olinga Taeed speaking at Big Ideas Zurich

Procure with Purpose

Procurious have partnered with SAP Ariba to create a global online group – Procure with Purpose.

Through Procure with Purpose, we’re shining a light on the biggest issues – from Modern Slavery; to Minority Owned Business; and from Social Enterprises; to Environmental Sustainability.

Click here to enroll and gain access to  all future Procure with Purpose events including exclusive content, online events and regular webinars.  

5 Reasons Your Procure-to-Pay Implementation Will Fail

Is your organisation about to embark on an initiative to purchase and implement procurement software?  Well, you’re bound to fail. Unless, of course, you address these landmines.

1. You don’t know what your requirements are

I’m sure you can define your problem.  You can probably guess without looking.  Lack of visibility, process, or control; maverick spending; inefficiency; mounds of paper…you name it. Immature procurement organizations that are not tech-enabled likely have it.  But these are just the symptoms.  It’s far more difficult to understand the underlying causes.  Sometimes Procurement’s ills are simply the result of  lacking the specific tool  to drive efficiencies, increase visibility, etc. In many cases, however, things are the way they are for a much more complicated reason.  The diagnostic process can prove time consuming, but accurately identifying Procurement’s sickness is the only way you can define and design a solution to cure it.  Going through a robust requirements gathering exercise is an essential to step in selecting best-fit technologies.

2. You aren’t buying the right tool

Without its requirements defined, how can Procurement know what tool to look for?  The underprepared organization is left to carry out solution design during the buying cycle, i.e. the sales cycle for software providers. This situation presents more than its share of headaches. For example, a common misstep is to buy P2P software to cure a lack of spend visibility (or simply because that’s what you had at your last company).  Someone selling a P2P platform will happily show you all the ways their reporting will provide spend visibility.  Of course this is after your RFP process (let’s say 1-3 months), implementation (6-9 months), and then onboarding and adoption to pull a full year of spend through the platform.  What that provider might not tell you is that there are spend solutions out there that can pull together your AP data, classify it, and feed it back to you in a matter of weeks!  That’s not to say P2P isn’t important for capturing savings, improving efficiency, and enforcing process compliance, it just may not be what you need right now.  Once you have your requirements down, you need to rack, stack, and prioritize your objectives as well as the tools you’ll need to achieve them. Building a technology roadmap to understand the full scope of investment over time to meet your goals.

3. Change management isn’t just training…and you aren’t prepared

Speaking of P2P, have you thought of just how many people, departments, and processes these tools will affect?  There are two factors that drive a successful technology implementation – strategic impetus and organizational readiness.  If you have neither, you probably won’t get budgetary approval.  But let’s assume that there is executive level buy-in throughout the organization to invest in procurement. Let’s even assume that one of those avenues is technology.  Do they really know what these investments will entail?  Does the rest of the organization understand the impact implementing a software platform will have on their people?  Do you?  If not, there are 2 options: 1) take some steps to get them on board, or 2) start with a less impactful investment that maximizes results and minimizes change.

For any platform, successful implementation depends on end users not just employing the software, but leveraging the technology (and doing so correctly) to derive the business outcomes you are looking for. Unlike more upstream procurement software modules like spend analysis and sourcing, CLM, SRM, and P2P touch various parts of the organization from Operations, to IT, to Finance, and everything in-between. This even includes the non-procurement stakeholders who will need to adopt the platform and the changes in process that come with it.   Communicating, generating buy-in, and managing the change throughout the organization is a huge undertaking.  Doing it successfully? That’s an even bigger ask.

4. You forgot to include your stakeholders

Speaking of stakeholders, did you forget to invite them to the design meetings?  How about the kickoff?  The demos? What about the project initiation meetings? If not, you are already behind the 8-ball.  Stakeholders should be incorporated early and often.  This includes requirements gathering and change management as mentioned above, but also the selection and implementation processes as well.  Not caring about the current state that you are about to change is a mistake.  Even if you think you know all of the ins and outs of the business (which you don’t), inclusion goes a long way in developing buy-in, encouraging  adoption, and (let’s face it) making sure you don’t miss anything. 

5. You don’t have a plan

Sure technology can probably solve your immediate issues, or put out the latest dumpster fire, but making tactical multi-year (and potentially multi-million dollar) investments in an ever-changing  landscape is short-sighted to say the least.  What is your ideal state?  Do you want to develop a best-in-class procurement organization?  Do you even need to?  Do you want 100% spend under management?  How do you even define spend under management?  What will your organization look like in the future?  How are you going to continuously improve?  How do you define success now and in the future?  And how are you going to measure that?  These are just some of the questions Procurement needs to answer when defining their vision for the future.  That vision should provide the foundation for your technology roadmap and ultimately determine the solution you select.  

Done correctly, the technology selection and implementation process could be a once-in-a-career undertaking. Don’t make these decisions lightly. Remember that Procurement’s new tools have to outlive the hype surrounding them and provide for the function’s continued strategic evolution. Slow down, ask questions, encourage collaboration, and never let the discussion around the ‘next big thing’ force Procurement into hasty decision making.

Anthony Mignogna is a Director at Source One, a Corcentric Company.

World’s Most Dangerous Supply Chains: Bolivia’s Death Road

Travellers on Bolivia’s ‘Death Road’ are given a stark visual warning about why the mountainous gravel pass is considered one of the world’s most dangerous supply routes: hundreds of crosses line the track to commemorate the frequent fatalities.

Formally known as La Cerretera de los Yungas, the vertigo-inducing path was once notorious for claiming the lives of up to 300 travellers a year as their cars, trucks and even buses careened over the unprotected roadside and down sheer 1000-metre cliffs.

In July 1983 a bus fell into a canyon, killing all 100 people aboard, while in 1999 eight Israeli travellers died when their vehicle did likewise.

Judging by the pictures and YouTube clips of what can only be described as a “glorified goat track”, it’s a wonder the death toll has not been even higher.

Also known as the North Yungas Road, the conduit stretches 69 kilometres up jungle-clad mountains between the Bolivian capital of La Paz and Coroico, in the Amazonian Yungas region.

The road was built by Paraguayan prisoners of war during the three-year Chaco War in the early 1930s to facilitate a military supply chain linking the Bolivian Amazon to the capital. The miserable living conditions of the construction crews set the tone for locals forced to use the supply route to transport crops, timber and materials to and from La Paz for the next eight decades.

Navigating the jungle-clad La Cumbre mountain pass, the twisting and turning road climbs as high as 4650 metres before descending a winding 54 kilometres to 1200 metres (the world’s longest uninterrupted downward stretch).

As a wise precaution, motorists are known to pray before embarking on the route.

“This road has humbled many egos,” says the Dangerous Roads website. “It’s not for the sissies and shouldn’t be attempted by novice drivers.”

In 1995, the Inter-American Development Bank described Yungas Road as the world’s most dangerous – no mean feat given the glorified goat tracks in regions such as the Himalayas.

The road is so dangerous that, unlike in the rest of the country, vehicles drive on the left so that the driver has a clearer view of the positioning of the wheels on the crumbling roadside.

In the wet season, the single lane road is made even more hazardous by mud, fog, rockfalls and landslides. Waterfalls are known to cascade across the road, taking much of the gravel with them.

In the dry season, choking dust reduces visibility to metres. Wisely, vehicles travelling downhill need to give way to ascending ones, as this forces them to slow down.

In the early 2000s the road was given an upgrade of sorts, with two driving lanes, proper asphalt and protective barriers.

But judging by recent photos, it’s still not exactly autobahn-quality.

The puzzling element is why anyone would continue to use it – apart from intrepid cyclists who have spawned a whole new industry. That’s because the Bolivian government completed a new nearby road in 2009 which, while mountainous, is more in line with western standards.

A 2013 clip from the UK motoring show Top Gear gives a good picture of the type of traffic encountered. Despite this safer alternative, the road remains popular as a supply route for locals, as tarpaulined trucks and even petrol tankers compete for space with buses and four-wheel-drives.

Host Jeremy Clarkson also gives a near fatal lesson in overtaking procedure, as his Range Rover comes perilously close to departing the road.

The footage might be edited for dramatic effect, but Clarkson’s manner suggests he is in genuine fear of producing his very last show. While the Yungas Road may no longer be the mandatory conduit between La Paz and Coroico, the adventure cycling business trades off its grim appeal.

It’s estimated that at least 20,000 extreme pedal-pushers brave the route every year, which exacerbates the dangers for all road users.

While most return home with tall tales and an ‘I Survived Death Road’ T-shirt, at least 20 cyclists have thought to have been killed on their road in the last two decades (exact numbers are unknown).

As might be expected, a thriving cycling tour guide industry has evolved, with a commensurate rise in four-wheeled transport for equipment and supplies to service the expeditions.

Intrepid cyclists are well advised to pick their tour operator carefully. As Australian journalist and Yungas cyclist Andrew Fenton writes, even the mid-range ones leave much to be desired.

“At one point the guide lines us up on our bikes at the edge of the cliff for a photo, and jokes: ‘OK, now everybody take a step back’!

“Hilarious—except one of the riders takes him seriously. His back wheel is hovering in space by the time we grab him.”

While La Cerretera de los Yungas’ Death Road cachet endures, adrenalin-seeking westerners may be heading to the wrong country: the Dangerous Roads site dubs an obscure Turkish pass called Bayburt Of Yolu-D915 as “probably more dangerous” than the Bolivian road.

Climbing to 2300 metres above sea level, the 105 kilometre road navigates 28 hairpin turns, linking Of and Bayburt in the country’s east. It’s a working road used by locals driving anything from trucks to motorbikes – and a highway to hell for the careless and impatient – or plain unlucky.

Forget New Year’s Resolutions! Do These 3 Things Instead

Giving up on New Year’s resolutions? For a fresh perspective, try these three suggestions to start 2019 in the best possible way.

I gave up New Year’s resolutions a long time ago. More importantly, I have never looked back. This wasn’t a decision made in defeat because I couldn’t achieve my resolutions. After all, I followed the guidance on setting SMART goals and remembered to acknowledge the small wins that add up to cumulative success as we are often reminded to do.

It was simply that on reflection, my view was that these types of resolutions come with the expectation of a new year bringing with it a personal remodel. Nothing wrong with that of course. Self improvement is what we are all striving for;  or trying to find the time to get to if we aren’t quite there. It’s just that I realised the concept of resolutions and I were not well aligned in two fundamental ways.

Firstly, the focus of resolutions we all tend to make seems to be addressing what we see as our personal shortcomings or deficiencies. Many of us start resolutions with This year I will ( be better at, get around to)…..or This year I will not……Does not quite apply to you? You would be one of the very few of us who has not resolved to; go to the gym, improve diet, work less, be more purposeful.

Secondly, implicit in the timing of new year’s resolutions is that individual transformation can or should only take place annually.  With U.S News reporting that 80% of resolutions fail by the second week of February, it seems making it through January is it’s own win.  That does not however, set us up well for the rest of the year.  Unfortunately all it does really seem to do is give us a bit over 10 months to berate what we see as a personal failure, even though the majority of the population is right there with us.


With the odds being so heavily stacked against resolutions, and for those of us not quite ready to give up yet,  what is left to do instead? It is important to note that I believe the new year is an important milestone because it creates a space for us to think about what has gone before and what we would like to realise from what is ahead. So if you, like me, were never that inspired by resolutions, these strategies may be helpful in setting up and navigating the year ahead:

Identify and cultivate moments that inspire you; then make more

Instead of thinking about what you have not done well or enough of, reflect on what you achieved in the last year both personally and professionally. Remember accomplishments, moments, and experiences where you were at your best. Some call this flow, others the zone. Irrespective of what we call it, we understand the importance of those moments. They may be very small or incidental. For me, the memory of hospitality at a little trattoria in Rome which had me sharing grappa early in the morning on an empty stomach, is just as inspiring as a large project delivered successfully. Or it may not have been the achievement of something, simply the attempt and perhaps, the surprise, of doing better than we thought. (I rode my first bicycle in 20 years in Myanmar in December and my sense of achievement was in simply staying on. This may not be a moment I will rush to replicate) Think about what you have done and consider (in whatever way works for you), how to foster the circumstances or relationships that enable you to surprise yourself. And don’t forget to provide some self-acknowledgement on the way through.

Explore self-renewal

While the start of the new year is a great time to reflect on changes we may want to make, or those we feel we need to, we know from transformation efforts in our work lives that there is never just ‘one thing”.  Any significant achievement is the culmination of detailed planning and execution and good practices, consistency, hard work, and yes, sometimes luck, all play a key part.

The strategy of self-renewal is critical here; taking inventory of experiences and finding the motivation to come back from disappointments and set backs. Understanding the importance of self-renewal gives us permission to accept that peaks and troughs are inevitable. It’s how we deal with them that matters. Consistency, mindset, and resilience matter and help us navigate the challenges. John Gardner has a brilliantly inspiring perspective on this. “ You don’t need to run down like an unwound clock. And if your clock is unwound, you can wind it up again”. He reminds us that although some challenges may seem insurmountable, we can always control how we respond. For me, simply going for a run is one of my go-tos. The distance and pace will vary depending on how I am feeling at that point in time. You can define and choose your own way to self renew that works for you.

Experiment with Curiosity

My nephews are constantly asking me questions. Although this continues to surprise me, those with children may just be glad that someone else is being subjected to the inquisitive mind of the young. Topics range from my preference for the DC versus Marvel Universe, anything sports related ( I fail miserably here), to how I ended up in Myanmar last year (I’m yet to explain that to their satisfaction).  

Instead of making a resolution for a specific intention, consider a mindset around curiosity. Experimenting with curiosity enables you to simply say you will ask questions, be open to new ideas, try new things.  Always asking why? Change your mindset and ask why not? It allows you to frame a world of possibilities and opens up opportunities that you may not otherwise be privy to or would have considered. That’s a big part of how I actually did end up in Myanmar. More importantly, curiosity sets a framework for continuous learning. That in itself facilitates new skills, different perspectives and as noted above, self-renewal. If you aren’t up to seeking something new to explore, that’s ok. A good way to start is simply to not dismiss the next idea someone shares with you. Want to simplify even more than that? Try a new food, read a book on a topic you don’t know much about, or listen to music in a new genre. Take the learning that comes with it, even if it that you won’t be doing that again!

There is no doubting that we know what we should be doing and that the challenge is always in making it a reality.  So with the start of the new year, it is a great time to remember that this year will be about continuing on the successes of last year, and the combination of small moments count just as much as the big ones.

Article by Alice Sidhu.

Why Inventory Management Need Not Be Organised

Amazon is pioneering a new method of customer-centric inventory management.

For decades, inventory managers have been focused on finding optimised warehouse layout to increase its surface area, provide efficient transit and reduce transit times. The fundamental premise has been that a warehouse should accommodate maximum inventory which can be picked and shelved safely.

The layout of the warehouse has been a key focus for most inventory managers, a grid-style warehouse layout has been widely used to optimise the shelf space, transit areas and transit times. The emphasis has been to maximise the cube space by using vertical as well as horizontal space in warehouses. Inventory managers focused on unit load sizes to maximise utilisation of the warehouse space.

Typically, asset inventory managers choose from one of the four widely used sizes – 1200X800, 600X800, 800X400 and 1200X1000. Pallet Racking, Shelving, Mobile Shelving, Multi-tier racking and mezzanine flooring are the key types of storage used in traditional warehouses. Conventional back to back storage is a popular approach from warehouse managers.

Example of organised inventory.

Slotting, replenishment and location control system got a lot of attention. Barcodes were extensively used and congestion was minimised in transit areas.

20% of the SKU’s (Stock Keeping Unit) which are fast-moving and contribute to the most of the sales are clubbed together and often referred as “bestseller or hot zone”.

For a long time, the warehouses have been arranged with physical logistics in mind – receivables, inventory management, inventory flow and dispatch were all based on delivery timescales of 2 to 5 days.

However, over the last 5 to 7 years’ customer’s expectation both in the B2B and B2C areas has been significantly changing. Understanding Inventory Management is vital for small and big businesses to be successful.

The contemporary way of managing inventory is pioneered by Amazon. They take a customer-centric approach and have arranged their warehouse and inventory technologies to improve product selection and delivery times for customers.

For example; At receivables, Amazon performs a six-sided check of each inventory to make sure the inventory is not damaged and is shippable. If there are issues with the receivables, Amazon’s problem solver unit takes anywhere between 2 hours to 2 days to establish the right status of the inventory. Once the item is scanned and okayed as an inventory, its exact location is known and it is available live on their website for their customers to order.

Once a customer orders a product from their website, a picker will be alerted to pick the ordered item. It is important to appreciate that Amazon does not store its inventory in order. Items are not clubbed together by nature or any other aspect. They are randomly stored in the warehouse – the technical term for this is random stow (or unorganised inventory).

Random Stow or Unorganised Inventory (Image: Amazon Warehouse)

There are robots which rearrange the shelves to facilitate the fastest picking route. The transit route is suggested by their algorithm which sends the location of the item to be picked on the handheld scanner of the picker. So rather than organising the inventory, they focus on the fastest route to pick items. Their robots move shelves to makes sure the picking is as fast as possible.

Once the item is picked, their computer suggests the right box size for packing, labelling is done automatically and the product is dispatched. Along the way, there are multiple automatic checks to make sure the product is shipped to the right customer. 

Whilst warehouses and inventory will always be a part of a cost center, approaching them from a customer-centric way can offer impactful revenue outcomes. If you take a delivery-centric approach at receivables and ensure the inventory at check-in is fully inspected, then you increase the chances of delighting your customers. Similarly, if you view the layout of your warehouse with a perspective to have the fastest picking route then your delivery timescales will improve. And as we saw in the case of Amazon, knowing the location of your inventory is more important than organising inventory by type or nature.

Written by Prasanna Kulkarni, Founder and Product Architect at Comparesoft.

Your Procurement Resolution: Don’t Settle For Best-In-Class

What better time to set and start tackling key objectives for 2019? Your new year’s resolution is to be better than best-in-class…

In this time of personal New Year’s resolutions, it seems appropriate for leaders to also consider a resolution for their departments. For Procurement leaders in particular there couldn’t be a better time to do so. In recent years, the function has made tremendous progress in transforming into a strategic value driver.

Yet, as leaders broadly acknowledge, this transformation journey still has a long way to go. A recent study by the Hackett Group found that only 63 per cent of procurement organisations have even developed a plan for digital transformation and 33 per cent bluntly stated their service does not meet customer expectations. A Forrester study on enabling smarter procurement found only 22 per cent believe their reporting and analysis is where it should be and only 22 per cent that they have the required agility to respond to changing requirements.

So what better time to set and start tackling key objectives for 2019?

My recommendation is to set an aspirational resolution that reflects procurement’s true potential. One that is distinct from your MBOs, which are likely based on continuous improvement of performance aimed at closing the gap with best-in-class.

The problem with best-in-class

There is nothing wrong with benchmarking yourself and striving to improve performance to match the best of your competition. Organisations should do so, especially if still early in their transformation journeys. Success will result in greater value to those organisations. But achieving best-in-class performance won’t result in procurement becoming truly strategic, and may actually hinder progress in the long term.

How is that so?

Look at it in the context of the World Cup (or the upcoming Superbowl). Every team in the tournament earned its spot by being the best in their region. Hence, each team can be said to be best-in-class. Yet only one is the champion and that team doesn’t win by playing at the same level as their best-in-class peers but by playing better, doing something critical differently. Best-in-class is not a competitive advantage in sports, nor in today’s increasingly winner-take-all market. It is a stepping stone on the path to true greatness.

If leaders are to build competitive advantage and truly drive strategic value, they have to think beyond best-in-class and view that as an interim objective on their transformation journeys. Leaders must ensure that the people and technology they embrace to navigate those journeys have the capability to take them the full way, and not become a constraint at some point.

Yes, your top competitors are doing this right now

What exactly does going beyond best-in-class entail? Is anyone actually doing this? Yes they are. Your top competitors are extending their competitive advantage even as you’re reading this. Below are just a couple of examples:

  • Revenue: A leading Telco leveraged the flexibility of our platform to create a private marketplace where suppliers can bid for used mobile phones in mass volumes, generating hundreds of millions of dollars each year
  • Innovation: In 2014 Meritor launched a three-year initiative to drive massive value by transforming their supply chain in what can be thought of as a drive to achieve best-in-class. They then followed that with a new initiative to unlock massive innovation through a unique approach to new product introductions, configuring our platform to their ideas. The result? Their stock price rose from $4.45 to $13.30 at the end of 2016 and much further since, far ahead of competitor growth.

Note that in both of these examples the teams implemented best-in-class processes and wanted quick value. It should never be a compromise. But they kept the ultimate objective in mind and brought on the right talent and technology to take them to the next level when ready.

The talent challenge

In any meeting with CPOs I have attended in recent years, the top pain point raised is attracting and retaining top talent. Talent that is up to the task of driving successful transformations, to best-in-class and beyond.

The above examples illustrate an important point about talent, and the symbiotic relationship with technology. What good is top talent if your systems are too rigid for them to bring their best ideas to life? Out of the box best practices are important, but that shouldn’t mean constraining yourself from doing a few strategic things differently.

Meritor has a great team with great ideas. So when deploying software, they took embedded best practices but ensured they had the flexibility to easily configure once they were ready for that next phase. This empowered them to realise a unique and innovative approach that supported their financial success.

Realise your true potential

So as we enter a new year, filled with endless challenges and opportunities I encourage you to set a procurement resolution. One that, if achieved, will set you on the path beyond best-in-class, to building a competitive advantage. One that will empower your talent to truly make procurement strategic and realise your true potential.

16 Blockchain Disruptions Explained In 1 Killer Infographic

Struggling to get your head around how Blockchain will disrupt your organisation? Check out this infographic from BitFortune explaining disruptions in 16 areas – including supply chain management.

Blockchain technology is probably one of the most impactful discoveries in the recent history. After all, it has a massive potential to change how we handle online transactions. Despite some skeptics, the majority of experts agree that blockchain has the potential to disrupt the banking and financial industry, and many other ones!

But what is this technology exactly? We at BitFortune.net will try to explain that in Layman’s terms, as well as provide you with insights into how different industries can benefit from blockchain.

To put it simply, blockchain enables decentralized transactions across a P2P network. There is no need for a middleman, resulting in almost instantaneous operations and most importantly, low fees. Plus, transactions carried out through a blockchain are much more secure, transparent, and private.

As mentioned earlier, different industries will have different benefits from implementing blockchain technology, and that is what this infographic is all about. For example, the banking sector will get faster transactions, lower costs, improved security, and better record keeping. Also, the blockchain technology can improve electronic voting systems. With this technology integrated into a voting system, governments won’t be able to tamper with votes because blockchain creates publicly viewable and singed transaction that can’t be changed or rewritten.

This infographic will help you understand how the blockchain technology can and will improve 16 different industries, from music to government. So, read on and find out what their future will look like.

blockchain disruptions infographic