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

Motivating Procurement for the next level of evolution

How do you motivate your procurement team to reach peak performance? Start by asking the right questions.

Procurement is a highly specialized field in most organizations, one that develops leaders as change agents creating value in literally every space that they touch. With the advent of the digital era, there is a greater need to understand and implement technology to foray into unconventional territories and look for hidden value. Thus, motivating the Procurement teams to look for new ways of creating and driving innovation becomes critical in present times.

As we look at motivating Procurement teams, it is important to analyze how the professionals working in different Procurement jobs think about their roles. The recent Procurement 2030 report, courtesy Procurious & Michael Page pointed out the insight that most Procurement CPOs consider talent development and retention as a key focus area for future. Thus, it is safe to say that motivating teams would be a top priority for talent retention in Procurement. This report also highlighted that the buyers and category managers consider almost half of their work as tactical vs strategic, and that almost half of the work can be automated i.e. it consists of repeatable tasks. These are useful considerations in understanding the current scenario before thinking about the next-level progress.

So what could be the ways of motivating Procurement teams into peak performance?

Organisational structures

Based on my discussion with Procurement colleagues across industries, I have come to believe that the right organizational structure in Procurement is a critical first step towards having a productive and engaged workplace. We have seen many waves of changes in Procurement structure across industries over the last few years. First, there were location focused roles, then the category management roles came into the picture. Slowly, the buyer roles also became more globalized versus being local or regional over time. Thus, the Procurement organization has kept evolving.

(1) Evolution of global category management: Most buyers today realize that category management is the way to be and global structures provide maximum visibility to drive change, thereby it is a welcome change to most of us. However, due to many continuous changes, it seems like there is a tendency for some ambiguity structure wise in many workplaces. I recall a peer from a mid-sized organization who had remarked in a forum that he liked building expertise in the global category manager role but at many times, he felt that he was doing the work which was distracting him from his core priorities of understanding business needs and finding creative solutions with the help of his supply base. It is certainly true that organizational structures were not intended to be a barrier when they were put in place. However, often the buyers at entry and mid-level spend valuable time looking for clarity about what they are supposed to do, as core priorities seem not so core when laden with structural challenges.

(2) One size does not fit all: Some organizations follow one structure strictly i.e. they have either the category management specific or location specific Procurement roles, while some have a mixed structure depending on business and country-specific supply needs. Depending on the size of the organization, there could also be a matrix or a hierarchical structure. It is often noticed that layers of hierarchy also lead to slower alignment and execution, thereby affecting creativity. In the face of further change, it would be good if leaders re-assess the current organizational structure that they have and analyze if it is set up for maximum effectiveness. We think about factors such as our business needs and supply needs while setting up roles, but with time as things change, it is good to re-assess design by deep diving internally into Procurement desk responsibilities.

(3) Internal feedback and self assessment to rescue: In the quest to motivate teams and help them deliver with effectiveness, it would be paramount to see where the teams spend most of their time and make changes that help simplify the structure while driving quicker actions. So look internally and ask yourself- Are your organisational structures distracting your teams? Do your teams think they are spending valuable time and energy on tasks which they should not be doing as they do not add value? Is your organizational complexity weighing them down, rather than helping them focus on business needs and external market evolution? A deep self-assessment and appropriate internal feedback could help provide the right design for the future. This could also be the way to get buyers to go deeper on building internal and external stakeholder relationships and removing some tactical tasks to drive efficacy.

Employee Coaching

The current digital era is the era of employee engagement. We have come a long way from the factory age where work was repeatable and top-down approach worked. Now, the best organizations are the ones where employees can feel understood, valued and trusted. Hence, the role of managers as coaches becomes all the more important.

(1) Coaching by asking right questions: I have often thought that buyers are prone to considering some strategic tasks as tactical because that is how these appear superficially. For example, an area new to Procurement where no one has evaluated the scale before could appear so in some cases. Then, for some time the buyer would only manage it as a low priority tactical item, not realizing the full value it can bring to the table if its potential is realized. When I was buying Facilities for Middle-East and Africa region, it was considered a tactical area until we saw the benefit of leveraging full scale by engaging competitive new players in the changing market landscape. Had we not analyzed this area internally and externally, it would continue to be labeled ‘tactical’. The key thus, is getting the right coaching and input, and being asked the right questions to look deeper rather than scratch the surface.

(2) Coaching by internalizing Maslow’s Hierarchy of needs: Good coaches have an understanding of human behavior and motivation. The oldest model known in understanding human behavior is Abraham Maslow’s hierarchy of needs. This can help managers to understand human behavior in office settings also. Usually, people have basic physiological, safety and belonging needs that would require fulfilment before they can reach self-esteem and finally the self-actualization stage. Of course, the peak performance is something that happens at uppermost levels of Maslow’s hierarchy of needs. This model can help both the coach and the coachee to assess themselves. Moreover, it provides the coach with a framework to understand the team first so that they can find ways to motivate people positively. A good coach can notice performance variations in the light of this model for themselves and the team, and use it to point them in the right direction.

(3) Coaching by understanding Losada line: Losada line is also an interesting principle in organizational behavior which measures the positivity to negativity in a system. What it states is that for any positive change to happen, a ratio of 3 to 6 is required. Lower than 3 would not be optimum for a good performance. To give you an estimate, successful marriages usually have a Losada ratio of 5 or above. This can be used by coaches to provide feedback and nudge the teams towards high performances.

In conclusion, as organizations get serious about leading with purpose and boosting positive collaboration for their employees, coaching and re-assessing organizational structures, on top of the existing mechanisms of training and rewards, could help unearth valuable insights paramount for their transformation into more evolved workplaces. While this happens, all of us in Procurement would need to be open to learning new things and adopting a growth mindset. In the words of Satya Nadella, as stated in his book Hit Refresh – “After all, how we experience the world is through communications and collaboration. If we are interested in machines that work with us, then we can’t ignore the humanistic approach.” We need to continue to bring humans closer by embracing collaboration and removing barriers. Do you think this could apply to your organization? What other strategies have helped in your journey?A

Don’t Let Your Action Bias Take Control Of Your Career

What is this motivating force that continually drives us? The answer could be – action bias.

Recently I found myself in unfamiliar territory; I had reached the bottom of the barrel. There was no big project to immediately sink my teeth into. I had achieved the unthinkable, I had achieved the workplace equivalent of clocking Facebook, there were no more stories to load.

Like any staffer worth their salt I was able to quickly fill that barrel back up but the level of discomfort that I felt stuck with me. It boarded on anxiety. I started pondering… what is this motivating force that continually drives me? The answer could be – action bias.

Action Bias

The term Action Bias comes from a 2007 study of penalty kicks in football “an analysis of penalty kicks shows that the optimal strategy for goalkeepers is to stay in the goal’s centre. Goalkeepers, however, almost always jump right or left. This implies that a goal scored yields worse feelings for the goalkeeper following inaction (staying in the centre) than following action (jumping), leading to a bias for action.”

A large part of my driving force within the workplace can be characterised by ambition, the desire to do a good job, to achieve outcomes, to deliver and “complete” but also to keep busy. It’s the last part that made me reflect.

Is keeping busy always a good thing?

We all have colleagues in the workplace that are constantly busy, the never ending flurry of shuffling papers, or the ghost colleague that is always in meetings and seemingly only comes back to the desk to sigh. Rationally we know that being busy doesn’t correlate directly to the quality or output of a person’s work but as a society we generally buy into the belief that being busy is a good thing.

The other recognisable “busy bee” is the creative thinker, the fire type, the fast paced ideas guy or gal. The negative association with these action orientated people is that they can shoot first and ask questions later, they jump to conclusions and engage in solution mode before deep analysis has taken place. While this is most certainly not a bad thing, it can be if done 100 per cent of time.

It could be proposed that the drive and motivation behind being busy is really just a societal acceptance of action bias.

So what happens when we stop? What happens when we take time to think?

What are the alternatives to being busy?

Looking at the items in the barrel, I realised that the new additions were improvements and value add’s and the bonus is that they are now captured in my work programme amongst the demand driven projects received directly from the business. The tendency towards action bias worked for me in this instance but I don’t think it should be my default.

Being busy can be characterised with a certain type of pace; moving fast and being stressed.

But, when you break it down being busy is about working towards a goal at a consistent pace that delivers the results you require. By reframing busyness in this way you can see the fast action and stress as a symptom of the belief system – be kinder to yourself. It is important to schedule time for strategic thinking and brainstorming that extends beyond the near future.

It is important to find time to think of new projects that deliver value to the business. It is important to think beyond the scope of “work” and perhaps the most shocking of all, it can be as simple as going for a walk and getting some fresh air.  Taking time to pause and go for a stroll in the sun is perhaps the most productive thing that we can do.

Best Of The Procurious Blog – Critical Factors When Selecting Your Suppliers

Procurement exists in a dynamic, fast-paced, constantly changing environment. So surely the reasons we use to select our suppliers and supply partners would change over time too? Wouldn’t they?

It’s been over three years since the Procurious network was canvassed on what critical factors they look for in their suppliers. The world has moved on a-pace in the intervening period and it’s interesting to take an inward look to see if procurement has developed at the same pace, particularly in its supplier selection processes.

Gone are the days of the cheapest price (or at least they should be!). Gone, and consigned to a very dark part of history, are the days where supply decisions were made over lunch or in private meetings, and related more to who you knew than what you knew, which golf course or members’ club you were part of. Or even (sharp intake of breath) what you might be offering the buyers in return.

Even the list below, the key factors highlighted last time out, may have been superseded. So what are the new criteria? Or, if they are still the same, why is this the case?

Cost and Quality vs. Social Value and #MeToo?

If we take a look back at the responses from the network in 2015, we find ourselves looking at a list with a number of the usual suspects on it:

  • Cultural Fit – including values
  • Cost – covering price, Total Cost of Opportunity/Ownership
  • Value – value for money and value generation opportunities
  • Experience in the market and current references
  • Flexibility
  • Response to change – in orders and products
  • Quality – covering products and service quality and quality history

In addition to this, some that didn’t make the top 7 as it was included trust and professionalism, strategic process alignment and technical ability. There’s nothing that looks out of place on the list. In fact, they’re all eminently sensible and fair criteria to be considering.

The problem is it that it reflects a very traditional view of procurement.

Given the changing environment that procurement operates in, wouldn’t we expect to see these criteria changing too? In the past couple of years, geo-political instability has dominated the landscape and shows no sign of disappearing soon with Brexit and a potential trade war between USA and the rest of the world just two examples.

But what about the other factors we need to be considering? Social value has jumped to the top of many organisations’ lists, increasing work with SMEs and Social Enterprises. And let’s not forget an increased focus on harassment, discrimination and equal opportunities following #MeToo and campaigns like Procurious’ own ‘Bravo’.

What Does the Network Say?

When asked their opinions on what the critical factors were, the Procurious network highlighted the following:

  • Previous Safety Performance
  • Service Delivery
  • Efficiencies
  • Cultural Fit
  • Price/Cost
  • Flexibility
  • Ethics
  • Quality and Consistency
  • Supply Chain
  • Financial Stability
  • Environmental Policies
  • Communication

I’ve highlighted in bold the criteria that appear in the previous list that also appear in the new one. As you might expect, they are the common criteria that procurement are known for, and may be expected to deliver as standard.

It doesn’t appear that other factors in line with Sustainability, Social Value and Equal Opportunities (to name but a few) are getting much of a look in. However, we’d need a much bigger sample to be sure. And that’s where the wider knowledge base comes in.

Procurement’s Response

Having a trawl through the latest articles on supplier selection and key criteria two things struck me. One, there were very few articles, blogs, thought leadership posts or even research papers from the past couple of years. The most recent one I found was from early 2017 and even using a broad range of search terms, it was difficult to find anything relevant.

The second, and perhaps most surprising/concerning, thing was how few mentioned any different criteria for suppliers. Only one article I could find mentioned Social Responsibility or Environmental Performance/Sustainability. The remainder still focused on the criteria commonly found in a Commercial or Technical/Quality evaluation. The most common criteria still were:

  • Years in business and financial stability
  • Price/Cost
  • Quality and Delivery
  • Reliability
  • Communication
  • Cultural Match

What does this say about procurement? Is the profession still falling back on the old favourites when it comes to supplier selection? Or could it be that traditional “thought leadership” is no longer leading the way, and organisations are working differently without shouting it from the rooftops?

For me, it’s a combination of all of the above. There’s no denying that it’s hard to separate procurement from cost and quality (after all, it’s what we’re there to do). And why wouldn’t professionals use criteria that are both reliable and easy to measure, particularly when time and resources are tight?

Getting our Message Across

Speaking from experience, however, there are areas in which overall value is much more prevalent. In the Scottish public sector, organisations are mandating Community Benefits for contracts above a certain value. These can cover everything from creating apprenticeships to financially supporting community projects.

In addition, Local Authorities have started to mandate evaluation of ‘Fair Work Practices’ in all procurement exercises. Again, this can cover a multitude of elements, such as paying the living wage, no zero-hour contracts, equal opportunities and good training and development. Suppliers are being forced to consider these criteria to the benefit of their employees and the wider society.

There is good work going on in procurement, but maybe we aren’t making the most of communicating our message to the wider market. And if communication is one of the key factors in supplier selection and subsequent relationship management, it’s high time the profession started telling suppliers what is important to us and seeing what they have to offer.