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Shifting The Dial In Procurement

Procurement has an opportunity, indeed an imperative, to transform from an enabler of cost reduction to a creator of sustainable competitive advantage.

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Traditionally procurement has been the efficient workhorse for organisations, driving cost savings percentage point by percentage point, contract by contract. Yet despite the tremendous impact that strong spend management can have in value creation, the reality is that in many sectors, procurement is still primarily a transactional function with a limited scope of influence. Minimal deference is currently given to a function that, in light of the unprecedented rate of change in the world today, could in fact unlock distinctive competitive advantages for their organisation.

There are major shifts taking place globally today to which procurement must respond: value chains are becoming more complex and volatile, with increased risks and opportunities that accompany that complexity; developments in digitization, automation, and analytics that can unlock previously untapped potential; and acceleration of technological advancements and innovations are now more difficult than ever to keep pace with without external partnerships. This rapidly changing setting brings an imperative to change how procurement operates as a business function, as well as an opportunity to extend the scope of procurement’s influence in an organization.

Winning in this more complex and digital future will require a complete transformation of procurement as a function: having a broader mandate, way beyond just cost reduction; investment in digitization, automation and analytics; and rethinking the procurement organization.

So, exactly where should procurement leaders start to transform their functions? As a starting point, let’s take a closer look at the most important global shifts, and the corresponding implications.

Volatility brings risks—and opportunities

Since 1980, global inter-regional trade has increased eightfold, making supply chains more global and interconnected. However, with rapid growth across emerging markets, ever-increasing talks of trade wars, and intensifying concerns about sustainability, global supply chains are becoming more complex, more volatile, and more risky. Procurement functions need to be more adaptable as ever to respond.

Recent changes in trade policies are forcing large multinationals to rethink their supply strategies. By some projections, for example, Brexit could cost automakers in the UK billions of dollars in additional tariffs, and potentially force some to shift production elsewhere. Many other industries are also experiencing significant upheavals due to the changing nature of trade relationships between the United States and other countries.

At the same time, by 2025, emerging regions are expected to be home to almost 230 companies in the Fortune Global 500, up from 85 in 2010 (Exhibit 1). In a rebalancing global economy, procurement teams need to look beyond traditional low-cost locations in China and Latin America and explore new emerging markets in Africa or Southeast Asia, which have become attractive for new global sourcing opportunities.

Increasing corporate attention to socially responsible practices adds another challenge in managing complex global supply chains. Greater transparency—and greater expectation to be transparent—means unethical behavior in even a tier-2 or -3 supplier has reputational impacts on the purchasing organization. While ethical sourcing isn’t a new trend, the extent to which consumers are now making purchasing decisions based on this is. And companies are responding: in the 2017 McKinsey Global Survey on Sustainability, respondents across all regions reported significant increases in the adoption of sustainability-related technologies.

Take, for example, the use of blockchain for the mining of cobalt, a critical mineral for the automotive and mobile-device industries. Reports of labor abuses in cobalt mines have led producers and customers to deploy blockchain technologies: each bag of cobalt is sealed with a digital tag that ensures full traceability to compliance-accredited mining locations, creating a new source of competitive differentiation.

This article is an extract and has been reproduced with permission from McKinsey & Company. It is co-authored by Tarandeep Singh Ahuja, a partner in McKinsey’s Melbourne office, and Yen Ngai, an expert in its Sydney office.  Full article is available here.

A Letter To The Board

Sorry to bother you, I know you’re all so much busier than me. It’s me, the chief procurement officer; the one who buys the custard creams.

By mpaniti/ Shutterstock

Dear C-suite,

Sorry to bother you, I know you’re all so much busier than me. It’s me, the chief procurement officer; the one who buys the custard creams.

Just wanted a word about this procurement lark that I’m beavering away at, while you all do much more important stuff like tweeting the latest thought leadership thought. It’s just that I’m feeling a bit, well, ignored by you all.

No, finance director, I haven’t come over all touchy-feely, though it would be good if you did; don’t you know empathy is one of the key skills of the future, even in the finance function? I have more hard facts than you can shake a stick at, if you’ll bear with me. Yes, that means you too, CEO.

I know procurement is hardly the bad boy of the C-suite, but let me tell you, that’s about to change. Think Olivia Newton-John at the end of Grease; that’s how much procurement is about to change. No less a person than Kai Nowosel, Accenture’s procurement chief, agrees with me. “I want to break the mould of traditional procurement,” he says. “Procurement is the tinder of innovation. I want to get into that model of being sexy instead of being a back-office function.”

See? But I’m not feeling the love. I know some of you are a bit vague about what I do; let’s face it, less than 10 per cent of global corporations have a board-level procurement director. So here’s your starter for ten: how much of the value of a company’s products or services is derived from its suppliers? Anyone? No? Almost two thirds, that’s how much. Write it down in your notebooks; 65 per cent, according to CAPS Research for the Institute for Supply Management.

And here’s another fun fact: world-class procurement organisations have 22 per cent lower labour costs, according to the Hackett Group. I heard that, marketing! Yes, of course I’m running a world-class procurement organisation. This company’s costs would be a darn sight higher without me.

That means you’ll miss me when I’m gone. No, public relations, it’s a figure of speech, I’m not actually going. Here’s an example of why procurement is important. The government has plans to name and shame anyone breaching the slavery law. So I’m the one standing between you and those headlines about our products being made by vulnerable illegal immigrants living in sheds, because you used some dodgy temp agency. Do you want to finesse that kind of PR disaster? Thought not.

But I could do so, so much more if only you’d put a bit of welly behind me; everyone seems to be getting a piece of our digital transformation except me. Fewer than 10 per cent of companies have deployed procurement solutions based on key technologies such as big data, the internet of things, serverless architecture or blockchain technology, according to Procurement Leaders (that’s an intelligence and networking company just for people like me).

It’s just not fair, especially when I could save up to $86 billion a year with a fully automated procurement function. Well, when I say “I”, I mean the Global 5000, but that’s 5,000 of my closest friends.

The thing is, digital is going to mean a bit of an upgrade in the old skills front. I’ll be honest, chairman, it’s going to be tough for that uncle of yours who works with me. But he did join the procurement department in 1973, didn’t he? I bet he’d rather work on his golf handicap than learn about embedding data science and analytics expertise.

So there might be some work to do for you, HR. Egeman Tumturk, global sourcing director at Bugaboo, said digital “requires a huge change in talent and the way we do our day-to-day activities, our jobs”, when he was interviewed by Procurement Leaders for its CPO Insights. He called it “a revolution”.

See, that’s really what’s happening here. We’re not talking about a bit of an upgrade, a few new smartphones and fling in a bit of software while we think about it. This is properly transformational; it’s not just about efficiency.

My job is about to morph from tactical biscuit-buying to strategic business innovation; that’s what management consultants Bain & Company says, anyway. “Artificial intelligence and robotic process automation are automating manual tasks and freeing up time for more strategic activities,” wrote Coleman Radell and David Schannon last autumn. “Digital technologies also provide a competitive edge by improving the speed and quality of procurement, reducing risk and enhancing innovation.”

Let’s face it, you need me to do this stuff, otherwise we’ll be overtaken by our competitors, who are already using advanced analytics to get value out of their historical data. It’s not really an option to leave me with an Excel spreadsheet and a glitter pen any longer.

Like me, Accenture’s Mr Nowosel sees the procurement role moving away from simply control and compliance, and into a core business function. It’s now about finding the right partners in the ecosystem, mitigating risk, protecting the brand and staying competitive. He says: “Getting competitive is more than having a great negotiated price. It is having the right solution for your customers at the right point.”

Couldn’t have put it better myself. We have a hyperconnected and increasingly transparent world out there and I’m the one with the bird’s eye view of it. If you invest in me and provide me with the right tools and people, I can develop an agile ecosystem that learns from its mistakes, protects our corporate reputation, cultivates a sustainable supply chain, delivers real-time data insights and predictive analytics, and saves you money – worth more than a few chocolate Hobnobs I expect…

Best wishes,

Chief procurement officer

This article, edited by Peter Archer, was taken from the Raconteur Future of Procurement report, as featured in The Times.  


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Minding The Procurement Gap: Where You Are Vs Where You Think You Are

To meet the ever growing list of procurement objectives, procurement leaders must effectively transform their organisations. While most organisations have begun this journey, many hit roadblocks along the way, which could easily have been avoided. During our latest CPO roundtable in London, sponsored by Ivalua, Arnaud Malardé, Senior Product Marketing Manager – Ivalua discussed how to map a path that enables you to rapidly progress to best-in-class procurement, and beyond, to establish a true competitive advantage for your company.

The keys to effective procurement Transformation

To meet the ever growing list of procurement objectives digital transformation is critical to success. But less than 30 per cent of procurement organisations have digitised more than 50 per cent of their processes. And a great deal of technology initiatives that are implemented fail to deliver.

According to a survey commissioned with Forrester, who surveyed over 400 procurement practitioners, those that have switched eProcurement technology, list the following three reasons for failure:

  • Supplier onboarding 30 per cent
  • Poor user adoption 27 per cent
  • Implementation issues 25 per cent

Of course, the obstacles to your digital transformation success differ depending on how far along you are on your journey. Beginners are more likely to suffer with insufficient budget or lack of executive support whereas teams in the advanced stages might find integration of S2P tools or procurement’s change resistance the most challenging areas.

Arnaud believes there is a gap between where procurement think they are and where they actually are. True digital transformation is a long way off for most.

His advice to plotting your path to successful transformation:

  • Don’t overestimate your maturity
  • Successful leaders focus beyond procurement
  • Evaluate technology carefully: avoid the key obstacles, assess based on today’s and tomorrow’s requirements

Delivering a story with style

As we grow older we increasingly feel as though we’ve lost our ability to trade freely in stories the way children do. But that’s not entirely true. Story telling expert, author, actor and inspirational speaker David Gillespie believes that we don’t ever lose our story-telling skills, just the confidence to use them. But it’s so important to see storytelling as king and queen because it is at the heart of everything we do in our personal and professional lives.

David revealed the seven basic plots of storytelling, one or more of which can be applied to any story. Try it for yourself!

  1. Overcoming the monster
  2. The quest
  3. Voyage and return
  4. Comedy
  5. Tragedy
  6. Rebirth
  7. Rags to riches

David also shared his advice for delivering a story with style

  1. Structure is essential – We can’t all be like Charles Dickens or Stephen King who don’t know how their stories will end when they start writing. A good place to start is the end. Decide where you want to take your audience to and work backwards to find the middle and the beginning – the set up, confrontation and resolution. Get your framework right to hang the narrative on
  2. Take your audience on a journey – You’ve got to take the audience on a trip. If you don’t there’s not sense of movement and no change affected. The point of stories is to effect change by taking your audience from point A to point B
  3. Fluidity of the journey – best stories are fluid and easy to follow – you shouldn’t be asking readers to connect from one point to the next
  4. Edit, edit and edit again – When in doubt chuck it out. that’s what the mantra of storytelling should be. As humans, we tend to hang on to things even if it’s not serving the plot. Take it out!
  5. Bring the story to life – All the best stories deserve to be told with the same passion and enthusiasm as how we conceive them

Cyber Security – are you prepared?

There are more reasons every day for organisations to consider the implications of a robust Cyber strategy but many are not sure where to start. There are more reasons every day for organisations to consider the implications of a robust Cyber strategy but many are not sure where to start. Mark Raeburn, CEO – Context discussed how we can manage cyber risk, avoid potential breaches and deter, detect and respond to the most sophisticated cyber-attacks.

Mark talked through the threat spectrum, which plots the desire of certain groups or nations to commit cyber attacks versus their capability to execute these attacks. Russia are by far the most capable foreign power and they have intent. In general, people are fearful of terrorism and, of course, they are massively keen to exploit cyber security but at the moment they are not capable. A big concern would be if ‘hackers for hire’ start working for terrorists.

Key motivations for targeting

  • Prepositioning and disruption
  • Intellectual Property Theft
  • Espionage
  • Stepping Stone Access

If you’d like to find out more about sponsoring or attending our CPO roundtables please contact [email protected]

10 Phrases You Should Never Say At Work

What are the phrases you should avoid in the workplace? We reveal the top ten most irritating and annoying phrases that are guaranteed to wind up your colleagues…

Some are just totally meaningless pieces of jargon – thrown into the conversation to disguise the fact that you have don’t know what you talking about. Others are downright rude or deliberately confusing. While some of the things we say at work just make us look stupid.

So, what are the phrases to avoid? Well the top 10 most irritating and annoying phrases to say at work (things that are guaranteed to wind up your colleagues) are:

1. With all due respect

When someone says this, what do they actually mean?

Often, it is the exact opposite… this is just a passive/aggressive way of saying, “I know better than you”.  Respect you? Well, they obviously don’t.

So, it is probably no surprise that these four words really wind us up and have been voted the most aggravating in the workplace by around half of those surveyed by CV-Library. If you are ever tempted to use this phrase (even ironically), don’t.

2. Reach out

The problem with this phrase, is that it can have so many meanings. When you thank someone for “reaching out” to you, are you implying they are offering to help you or that they are asking for help? Telling someone else to do this (as in ‘go and reach out to accounts’) is patronising particularly if what you really want them to do is make contact in a highly professional manner.

While “I’ll get my people to reach out to you” is incredibly confusing. What does mean? That they will be in touch next week? Or is this just a polite way of saying “don’t call us and we won’t call you”?

3. At the end of the day and 4. It is what it is

So, the boss is stumped…and cannot think of a solution. So, they say “it is what it is” as a way of saying let’s just accept a bad situation. Worse, “at the end of the day” implies that what will be, will be. Put the two phrases together – At the end of the day, it is what it is – and you might as well throw your hands in the air and give up. Please: just say it like it is.

5. Think outside the box

What is wrong with telling someone to think creatively and come up with innovative solutions? Context. Generally, you are told to “think outside the box” when everyone else is stumped for ideas. So, you are being asked to do the impossible. Also, most organisations don’t actually welcome unconventional and original thinking.

6. Let’s regroup

This is another phrase that has too many meanings. Is this a polite way of telling a group that they are all useless and new people need to be brought into the meeting? Or that you need fresh ideas? Or just more time to think of new ideas? Confused? You will be.

7. Can I borrow you for a second? and 8. Have you got two minutes?

Another irritating habit is using a euphemism to impose on your time when you are already extremely busy. Let’s face facts: the interruption is never for two minutes let alone a second. The person who uses this phrase, knows you would refuse to give up your afternoon to help them. But when they pretend that all they need is just a small amount of your time, it is really hard to say “’no” without appearing difficult. Irritating, isn’t it? When you are tempted to use either of these phrases, think about that.

9. At this moment in time

This is a great way to obfuscate when you do not have a clue/haven’t completed the project/forgot to follow a lead/don’t want to commit to a yes or no.  etc. So, “Is the client going to make that purchase?”. Answer: “At this moment in time, they are considering it”. The truth? Anyone’s guess.

10. Get the ball rolling

This is a bit last century when sporting metaphors dominated the world of business gobbledegook. Remember: “pass the ball”, “left field”, and “knocking it out of the park”?  Not only is this dated, once again it is not good communication… tell it like it is.

Surprisingly, motoring metaphors such as “in the fast lane”, “shift up a gear”, “put the brakes on”…or that highly annoying “let’s park this to one side”, don’t feature in the top ten.

So next time you are tempted to slip into jargon remember it is highly irritating. Also, being direct gets better results. “People may take what you are saying the wrong way,” says Lee Biggins, founder and CEO of CV-Library. “If you’re hinting a circling back to the task later or asking for more hands on deck, this can come across as rude. Are they not good enough for this task?”

….AND THE 10 THINGS THAT YOU SHOULD NEVER SAY IF YOU WANT A PROMOTION

While jargon is annoying, in an interview for a step-up the career ladder, it is being too informal that is the problem.

What are you trying to convey? If you are a more mature candidate, perhaps you believe (wrongly) that saying words like “epic fail” makes you down with the kids. It doesn’t.

Or if you genuinely litter your conversations with “totes” perhaps you don’t realise that this is NOT the way to get a better job (even if it is a very informal setting). It is just not professional.

So don’t be tempted. These are the buzzwords employers are fed up with hearing:

  1. Literally 
  2. Like
  3. Just sayin’ 
  4. Banter
  5. Totes
  6. Amazeballs
  7. My bad
  8. Yolo 
  9. Me thinks
  10. Sorry not sorry

“Be mindful that if you’re after a promotion, your employer won’t appreciate you saying a buzzword like ‘my bad’ to excuse yourself for making a mistake,” advises Lee Biggins who warns that using colloquialisms makes you appear less intelligent, can confuse colleagues if they don’t know exactly what you mean and frustrates those you work with because there is a “lack of substance” behind what you’re saying.

Do You Know What Your Procurement Function Can— And Can’t—Do?

Leaders who know more about their procurement functions are more realistic about what procurement can do—and how much more it can achieve.

By RZ Images/ Shutterstock

For many business leaders, the procurement department may seem to rank low on the list of worries. In many companies, procurement accounts for less than one percent of the total functional budget, so it may not attract the same attention as functions with larger budgets. More importantly, however, we find that executives see procurement as purely a transactional function that executes commands and delivers goods, rather than a potential source of value.

But that myopia has consequences. The Global Procurement Excellence survey, encompassing more than 1,100 organizations worldwide, shows that the best-run procurement organizations have a far more accurate understanding of their own capabilities than other businesses have (Exhibit 1). Procurement followers, by contrast, are especially prone to overestimating their procurement skills.

Overestimating existing capabilities blinds companies to the need for improvement. And where is that improvement needed most? Certainly, procurement functions need to get the basics right in category management, global sourcing, supplier development, and risk management. But the survey data show that single most important driver of procurement performance isn’t in these “hard” metrics, but in “soft” metrics regarding the people in the procurement department (Exhibit 2).

Talent management is an especially major challenge, showing significant gaps between procurement leaders and followers. Scores were especially low on procurement career paths, consistent with perceptions of procurement as a field with limited advancement potential. Organizations that created selective job-rotation programs within procurement were more likely to be procurement leaders, as were those that made sure that high performers were well rewarded and moved on to other parts of the business.

Exhibit 1

Procurement leaders invest in talent management and set high aspirations

Exhibit 2

Procurement leaders are accurate in their self-assessment while followers fail to see performance gaps

Furthermore, with digital proving just as critical in procurement as in any other part of the organization, talent attraction and retention are becoming even more important for the future. Only by hiring, training, and retaining people with digital skills will procurement be able to deliver in an increasingly disrupted and competitive landscape.

These findings illustrate how important it is for businesses to keep procurement from becoming a backwater. It’s worth management attention, and it’s worth investing in procurement’s people.

This article was written by Riccardo Drentin, an associate partner in McKinsey & Company’s London office and Fabio Russo, an engagement manager in the Milan office.

The (Office) Walk Of Shame: Workers Who Quit Because They Are Too Embarrassed To Stay

It’s not all about the money. The real reasons why we quit range from bad bosses who make passes to wars over stolen food from the office fridge as well as shame – doing something so excruciatingly embarrassing we just have to resign.

By worradirek / Shutterstock

You might think that a chance to earn more money would be the number one reason why we quit our jobs. But you’d be wrong. Being offered more cash actually comes in at number three.

Topping the chart is the desire for a better work/life balance whether that is a job with more flexible hours or at least without the long hours most of us have to put in to get the job done.

Also making the top ten are long hours and long commute, which are basically other ways of saying the same thing: many of us are fed up with living to work and want to work in order to live.

We’ve had enough of bad bosses

The appalling behaviour of some managers is another reason why employees can’t wait to hand in their notice according to research commissioned by SPANA the working animal charity (yes, some animals work too!)

 “I thought the boss was useless” comes in at number five, “I fell out with the boss” at number nine and just making it into the top 20 at number nineteen “I had a physical altercation with the boss”. If things get violent, you know it’s time to leave (and perhaps sue?).

Despite #MeToo coming in at number sixteen for the number one most common reason for quitting is “My boss made a pass at me”.

Some of us get stroppy over petty squabbles

However, some reasons for handing in your notice are quite frankly ridiculous. Leaving because the free tea and coffee was taken away, because a colleague stole your food from the work fridge or you are not allowed to change the radio station or don’t like your desk position (all in the top 40) are a bit drastic…. There is no guarantee your next workplace will be any better.

That is why you should spend time really researching your new workplace – not just the job, but also who you will be working with including the boss, the office environment – (it might be a dingy basement not the plush interview office – and important work/life factors such as the commute to work.

Putting two fingers up to your employer

Half of us are so fed up, we just hand in our notice without having another job to go to.

Still, you can’t beat that “I quit” feeling… with half saying they felt a massive sense of relief after doing so. That probably includes those who did something so embarrassing (possibly at a work party or with the photocopier) that they just had to leave and never go back. In that case it is entirely understandable that you would not want to hang around while you find a new job.

But we’re not up to admitting why

You can see why someone would not want to admit that they had done something so shameful that they could not bear to return to work.

However, these quitters are not the only ones who shy away from the truth. One in four British workers have lied to their bosses when it comes to the real reason for quitting their jobs according to global recruitment specialist, Michael Page.

We may be leaving because we are not paid enough – or not feeling like we are valued – but we haven’t got the guts to fess up. Ironically, in this candidate-short market, saying you are leaving for a bigger salary could lead to a counter offer from your existing employer, so it might be worth making your point (after all, you are leaving anyway!)

The survey also found that one in ten just do not feel like they fit in – particularly LGBT workers, those from an ethnic minority background, workers with long-term health conditions and younger workers (aged 18 to 34.)

Top 20 reasons for quitting a job

1. Wanted to improve work/life balance

2. It was too stressful

3. Was offered more money

4. I didn’t like the company culture

5. Thought the boss was useless

6. Felt I wasn’t learning anything new

7. The hours were too long

8. The commute was too long

9. Fell out with boss

10. I hadn’t been given a pay rise in ages

11. The perks weren’t good enough

12. I felt I’d hit a glass ceiling

13. The atmosphere was dull

14. Fell out with colleagues

15. Hated my desk position

16. Boss made a pass at me

17. My ‘work best friend’ quit and it wasn’t the same without them

18. Had a physical altercation with colleague

19. Had a physical altercation with boss

20. Did something so embarrassing I was forced to move company

 

Redefining Procurement Excellence At The World Procurement Awards

Earlier this month Procurement Leaders hosted the World Procurement Awards 2019. And the winners are…


By vchal/ Shutterstock

Earlier this month Procurement Leaders hosted the World Procurement Awards 2019. The winners joined the ranks of the trailblazers before them and received the opportunity to proclaim their excellence to the world.

Now in their 13th year, The World Procurement Awards, in association with SAP Ariba, are the most celebrated and sought-after awards in procurement, recognising the most progressive people, projects and organisations across the globe.

The 2019 winners were announced during a prestigious ceremony hosted by Great British Bake Off presenter, Sandi Toksvig at the InterContinental London, The O2. The ceremony brought together 1,000 procurement elite and closed out the inaugural World Procurement Week, following the new Indirect Category Leadership Forum and industry-leading World Procurement Congress.

The independent regional judging panels were highly impressed with the quality of this year’s submissions: “The quality of the submissions is deeply impressive! What comes across clearly in almost all submissions is a
play-to-win mindset. We are fortunate to have that many top-notch procurement organizations across the globe creating real value for their companies.” Thomas Rothe, SVP, Procurement International, Strategy &
Governance, Bayer AG.

“It’s been an honour to serve as a judge for the awards. The process has been eye-opening as to the incredible progress being made by leaders of the function in areas from CSR to digital transformation, and becoming trusted advisors to their business stakeholders.” Howard Richman, CPO, Citrix Systems

All entries endure a thorough three-stage judging process, to ensure complete transparency and guarantee that the winners really are the best of the best. As another judge, Cindy Elliott, VP – Global Strategic Sourcing
at The Clorox Company explains: “To achieve the honour of being on the shortlist of winning entries, your submission is among the best-in-class of procurement being judged by leaders of multiple companies in a rigorous 3-step process! Congratulations!”

Other judges on the 2019 panel included senior representatives from Bugaboo International, Cisco, IBM Corporation, Mondelēz International, Novozymes, Siemens Healthineers, Swiss Re, and many more global leaders.

Congratulations to all winners and finalists and thank you to everyone who took the time to enter. We were overwhelmed with the sheer number of entrants and the evident innovation and passion displayed through these submissions.

World Procurement Awards 2019 Winners

Procurement Consultancy Project Award
Winner – MyBiz Solutions
Highly Commended – PwC

Procurement Technology Award
Winner – GEP
Highly Commended – Scoutbee

P2P Specialist Provider Award
Winner – Ivalua
Highly Commended – BuyerQuest

Corporate Social Responsibility Award, Partnered by EcoVadis
Winner – Mars Incorporated

Innovation Award, Partnered by Ivalua
Winner – Tomorrow Street (joint venture between Vodafone and Technoport)

Cross-Functional Collaboration Award
Winner – Mondelēz International
Highly Commended – GSK

External Collaboration Award, Partnered by Vizibl
Winner – China Mobile

Future Leader Award, Partnered by Capita Procurement Solutions
Winner – Cate Warman-Powell, BT, London

Risk Management Award, Partnered by IntegrityNext
Winner – Clariant

Supply Chain Initiative Award, Partnered by Maistro
Winner – IBM

Talent & Development Award
Winner – Turkcell

The ConnXus Supplier Diversity & Inclusion Award, Partnered by ConnXus
Winner – UNOPS

The GEP Procurement Team Award, Partnered by GEP
Winner – Heineken

The h&z Transformation Award
Transforming External Partnerships
Pioneering business impact Partnered by h&z

Winner – Vodafone Procurement Company

The h&z Transformation Award
Transforming External Partnerships
Pioneering business impact Partnered by h&z 

Winner – Vodafone Procurement Company

Internal Transformation
Establishing the function Partnered by h&z

Winner – Adidas

Cross-Functional Transformation Developing strong internal relationships Partnered by h&z 
Winner – Save the Children International
Highly Commended – Zalando

The SAP Ariba Procurement Excellence Award, Partnered by SAP Ariba
Winner – Vestas Wind Systems

The Smart Cube Procurement Leader Award, Partnered by The Smart Cube
Winner – Gary Foster, Highmark Health

Lifetime Achievement Award
Winner – Robert Monczka

World’s Deadliest Supply Routes: Ice Road Trucking

Are you responsible for sending your people into danger? In a new Procurious blog series, The World’s Deadliest Supply Chains, we investigate the most high-risk supply chains out there…


By James Gabbert / Shutterstock

The intrepid truckers on the temporary ice roads spanning hundreds of kilometres of frozen lakes in Canada and Alaska keep their hands on the door handle for good reason: should the ice crack, they have a split second to leap from the vehicle before it falls into the icy, watery abyss.

For a decade, viewers of the History Channel were given a first-hand view of what motivates these drivers and the perils they face, which include not just a frigid sinkhole but avalanches, whiteouts and hypothermia, even earthquakes and volcanic activity.

Set in Canada’s Northern Territories and Alaska, Ice Road Truckers lasted 11 series between 2007 and 2017.

The truckers’ mission was to supply remote gold and diamond mines and entire small towns with goods in the winter months, when road access is only possible because the lakes have frozen over.

Items included anything from fresh food to mining equipment that would be tricky to transport even on well-laid bitumen.

Featuring nicknames such as “Chains”, “Bear Swensen”, “Polar Bear” and “Hammer Down”, the rough-hewn drivers were often depicted in mishaps such as when they ran off the road or got bogged.

In one episode, viewer favourite Lisa Kelly – one of three female drivers – leaps from her truck amid ominous cracking sounds and a disconcerting build-up of water under her rig’s 18 wheels.

As is the norm for ‘reality’ programs, the series was criticised for overdramatising and promoting reckless behaviour among the truckers – one of them, for example, exclaims “yee-haw!” after driving too fast over a rough patch of road.

The opening sequence showing a truck sinking through the ice was staged at a Hollywood studio in sunny California, using sugar and shaved ice. However, the set-up was based on a real accident at Mackenzie Crossing in Alberta, with the driver apparently not recognising a warning sign that the road was suitable for light loads only.

Some viewers were less than impressed with the skills of the Ice Road Truckers cast. “Who the heck tries to pull out another truck using a chain that has slack in it and then drops the gas [accelerates] and takes off?” asked one heavy-haul driver.

Ventures West Transportation president Glenn Bauer reckons the televised truckers come across as a “bunch of cowboys” (the Alberta-based company hauls fuel to some of the Canadian diamond mines featured early in the series).

He says the only incident he knows about involved road-building equipment falling though the ice. “In reality, it’s very, very controlled,” he told truckingnews.com.

Despite the series’ bent towards entertainment, there’s little doubt that navigating a 70 tonne load over hundreds of kilometres of icy wilderness is inherently dangerous and there have been some fatalities over the years.

Fatalities are rare, though. As a guide, the 27 truckers in the Ice Road Truckers series all lived to tell their war stories, save for Montanan Darrell Ward who died in 2002 aged 52 – in a light plane accident. He was, ironically, on his way to film the pilot for a documentary-style show involving the recovery of plane wrecks.)

One reason for the low fatality rate is that, as with inherently risky aviation, operators are required to follow strict safety protocols.

For instance, trucks travel in convoy (although not too close together) with the most experienced drivers leading, and trucks are limited to speeds as low as 10 kmh. In parts where slush is forming, drivers are advised not to stop altogether lest they get stuck.

The ice roads are not random trails, but can be engineering wonders. One example is the Tibbitt to Contwoyto Winter Road, which spans 595 kilometres from north of Yellowknife into the neighbouring territory of Nanavut.

The width of an eight-lane highway, the road takes 140 workers to build each year and can support 70 tonne, eight-axle articulated trucks.

The famed Dalton Highway in Alaska – spanning 414 miles from Fairbanks to the oilfields of Prudhoe Bay – was the subject of an innovative repair job that itself presented a huge logistics feat.

The massive task involved underlaying 80 kilometres of a vulnerable section of the highway with 1.2 million metres of polystyrene foam strips, to keep the permafrost frosty and to raise the road above flood level.

Apart from a crazy streak, the only formal prerequisites to become an ice-road trucker are completing high school and possessing a heavy commercial truck licence. The truck companies provide the training – not that there is any real substitute for experience.

With no pit stops along the way, the truckers need to be proficient drivers as well as proficient mechanics.

The lure of the lucre is a key motivation, although pay levels vary markedly. Typical remuneration for a season varies between $US20,000 and $US80,000, but harder working truckers can earn up to $US250,000.

The pay levels depend on the distances driven, the type of cargo and the hazard levels.

Despite high competition for relatively few jobs, driver turnover reportedly is very high, with many not returning after their first trip after realising how dangerous the game can be.

A paradox of the ice-trucking game is that while the frigid conditions make for treacherous conditions, warmer-than-expected weather is even worse because the highways are more prone to crack and develop slushy parts.

In the next few years, climate change, rather than ice blizzards and crevasses, may defeat the hardened people of the ice roads.

If you’d like to read additional related content or get involved with thought provoking discussions check out the Supply Chain Pros group – a one stop shop for all your supply chain need

Is AI The New Electricity?

For supply chain professionals, the drive to use AI is there. But how do organisations get to the point when AI-enabled supply chain management is the norm?

By kung_tom/ Shutterstock


“Electricity changed how the world operated. It upended transportation, manufacturing, agriculture, health care. AI is poised to have a similar impact. Artificial Intelligence already powers many of our interactions today. When you ask Siri for directions, peruse Netflix’s recommendations, or get a fraud alert from your bank, these interactions are led by computer systems using large amounts of data to predict your needs.”

Andrew Ng – Stanford University – March 2018

According to the results of our latest survey, Procurement 2030, supply chain pros are well aware of how impactful AI could be for their profession. Indeed, 92 per cent of professionals believe the profession will transform by 2030 as a direct result of new technological innovations. And 51 per cent predict that, with the help of AI, supply chain professionals will become an agile group of strategic advisors.

The intention to utilise technology is there. But how do organisations get to the point when AI-enabled supply chain management is the norm?

Getting started, and knowing where to start, is tough going – as with anything new and unknown. We know that many supply chain pros are concerned that implementing AI into their supply chains is a complex step. In fact, our survey takers ranked it as the technology they feared most difficult to adopt. But are their fears unfounded?

We want procurement pros to be pushing the limits on Industry 4.0, and the first to adopt new technologies.

And so, in our latest webinar – How AI Saved My Day Job: Confessions from a Supply Chain Pro we’ll be demonstrating that AI is the real deal by giving you the insider information, the low-down, on what it is delivering right now for supply chain teams.

Webinar speakers

We’ll be speaking with supply chain professionals who are already implementing AI in their organisations and have discovered that AI does provide a demonstrable bottom-line impact across all supply chains structures. Speakers include:

  • Rob Allan – Program Director, Supply Chain Insights Offering Management – IBM
  • Tania Seary Founder – Procurious
  • Connie Rekau – EDI Manager – The Master Lock Company
  • Nickolas Bonivento – EDI Manager – Anheuser-Busch InBev

When is the How AI Saved My Day Job webinar?

The webinar takes place on 15th May 10am ET / 3pm BST. Sign up or log in via the form above and we’ll be in touch ahead of the event to provide details on how to join the webinar live.

How do I listen to the How AI Saved My Day Job webinar?

Simply sign up here and you’ll be re-directed to the Supply Chain Pros group where you can access heaps of related content. You will also join the webinar mailing list, so we can provide you with details on how to access the webinar before it goes live.

Help! I can’t make it to the live-stream of the How AI Saved My Day Job webinar?

No problem! If you can’t make the live-stream you can catch up whenever it suits you. We’ll be making it available on Procurious soon after the event (and will be sure to send you a link) so you can listen at your leisure!

Do I have to be a member of Procurious to access the How AI Saved My Day Job webinar?

Yes. To access the webinar you’ll need to sign up to Procurious. You’ll be joining a community of 30,000 like-minded procurement and supply chain peers and gain access to all Procurious’ free resources. You’ll be joining a community of 30,000 like-minded procurement and supply chain peers and gain access to all Procurious’ free resources.

Could AI revolutionise your supply chain and save your day job – allowing you to make better decisions, more efficiently and in a more repeatable way over time? Let’s find out!

Could You Afford To Lose $2 Billion In Sales?

What does digital transformation mean for the procurement and supply chain profession?  How will it help CPOs to mange risk in their supply chains?

By DimaPalich/ Shutterstock

The concept of digital transformation has been around for quite a while, ISM CEO Tom Derry argues. “In the late 90s we started doing reverse auctions and e-auctions. Not too long after that dynamic discounting began to enter the equation and FinTech platforms have also been around for a while. We’ve been embracing it but recently we’ve hit a pause in that innovation wave. And it seems like we’re on the brink of this next wave.”

How will digital transformation transform procurement and supply chain?

Digital transformation is the full impact or outcome of using data on elevated platforms to really reinvent what procurement and supply chain professionals are doing.

“In the source-to-settle process we typically identify 37 discreet steps” explains Tom. “And we think four technologies – procure-to-pay platforms, RPA, machine learning and IoT – will mean that all but eight or nine of those discreet tasks will be automated.” This, of course frees up time for humans carry out only the most important things like stakeholder management and supplier relationship management, the things that can only happen as a result of conversations between people.

Indeed, it is these soft skills that will galvanise the procurement and supply chain professions and make them step out into the future. When data is pointing you in different directions and the computers don’t know what to do, that’s when you step in.

Is supply management ready for change?

A recent survey revealed that only 6 per cent of CPOs possess the strategic leadership traits to lead digital and analytical transformations.

“I’d say there is a lot of discomfort. People don’t really understand the technologies we’re talking about and they don’t necessarily have the in-house skills,” says Tom.

“An interesting example is the technology that is currently being piloted in 30-40 per cent of large companies – RPA.” And yet most people don’t even understand what this technology is. “They think it means a robot from ‘lost in space’ when we’re actually talking about software code. The code fits into the gap between systems so imagine your ERP system, your spend analytics tool and any other systems you’re using. We’re typically trying to build reports by extracting data from these disparate sets of data, putting them in a data warehouse or a data lake, doing some analysis and running reports.

“RPA can automate most of that work so a human doesn’t have to go in and identify the data. RPA is good at doing routine, highly-defined processes.” This frees up the time of professionals so that, instead of spending half the day obtaining and cleansing the data, time can be spent on activities where there is real value-add. “The insights and the applications, for me, is the real opportunity.”

Selling the benefits of digital transformation

How does Tom advise managing those risk averse CPOs, who are reluctant to take the plunge with new technologies? Can you overcome that and sell the benefits to them?

“One of the biggest pay-offs for even the most risk averse CPOs is using digital tech to visualise the risk in your supply chain.

“I heard about a publicly traded pharmaceutical company in the states who did a risk analysis and claimed that anything less than $1M in spend is so small it’s immaterial. They wouldn’t even look at it. But it turned out they had $200,000 in spend on a coating for a consumer medication, which supported $2B in annual sales.

“[The plant in Japan that produced this coating] had a fire and they were at risk of losing all of these sales. If that doesn’t get the board’s attention, I don’t know what will. So when it comes to risk, that’s where the immediate benefits will be!”

When it comes to digital transformation, people know they need to be educated. “you have to get as smart as you can on what’s coming!” says Tom.

In our 10-part “Tuesdays With Tom” podcast series, Tom Derry discusses a broad range of critically important topics that every supply management professional should be across.

Listen to the full podcast here.