All posts by Procurious HQ

10,000 Reasons to Join Procurious

Procurious is celebrating its 10,000th member months ahead of its second birthday in a milestone that has surpassed all expectations.

Procurious-10K-Banner1

We’re delighted to make this announcement and want to take the opportunity to thank all of our members for helping us to build and grow such a fantastic community.

When we launched in May 2014, we wanted to provide a hub for members to advance their careers, develop their skills and expand their professional networks. We like to think that the growth in the community suggests that we’re making a difference for procurement and supply chain professionals.

Shifting Procurement Landscape

A huge shift is in the making within the procurement/supply management profession. While cost remains important in the procurement function, professionals work at the interface of an extended global supply chain and are responsible for an ever-growing corporate spend.

Increasingly, Chief Procurement Officers (CPOs) command a seat next to the CEO in the boardroom, and successful supply management practices are seen as pivotal to corporate growth. As a result, demand for new talent is soaring, and so are advancement opportunities.

Against this backdrop, Procurious broke new ground in May 2014, when it launched as the first free online global business network for curious, ambitious procurement and supply management professionals. Building on its mission to strengthen the global supply chain community, Procurious has become a vital source of knowledge, connections, news, and advancement opportunities.

Unlike other communities, Procurious offers a powerful combination of career advancement, skill development, and professional networking, all on one platform. With more than 80 eLearning videos, discussions on everything from commodity indices to procurement systems, and a wealth of guest writers adding their voices to a twice-daily blog, Procurious is at the epicenter of the industry

Flexing Collective Muscle

“The complexities of procurement and supply management are a world away from what they were a decade ago. Executives realise the huge risk posed to their business if there are supply chain disruptions, or costly reputational damage caused by bad management and supply chain practices,” said Ms Seary.

“This means that organisations of all shapes and sizes are placing a far greater emphasis on procurement professionals, who are commanding a seat right next the CEO at the boardroom table.

“It’s a world away from the procurement function within organisations a decade ago, when procurement was still considered a backroom function. Back then, buyers struggled for influence over corporate spend, typically buying from large suppliers and sticking with long-term contractors, with the primary focus on cost.

“Many of the issues the profession faces are too big for any one person or company to address alone. It’s exciting to think what our global procurement community can achieve as we flex our collective muscle.”

Engaging the Community

Procurious members engage with the site daily to find a daily stream of highly relevant and credible procurement news and information and broader business and tech/digital news that can be difficult to locate among the noise on LinkedIn.

Procurious member, Chetan Shetty of Productivity Champion Advisory Services in New Zealand, said the site contributes to their business network efforts. “The site is very different and a refreshing approach to connecting with like-minded professionals.”

Members hail from over 140 countries and represent some of the largest organisations in the world including Visa, BHP Billiton, British Airways, Apple, IBM, Shell, HSBC, Unilever, NHS and Deloitte.

You can join the Procurious community for free today by registering at Procurious.com.

To celebrate our milestone, we’ve created a neat infographic to illustrate just how far our 10,000 members could take us…

Procurious-10K-Jan2016-infographic copy

Meanwhile, here are some of the key headlines from procurement and supply chain this week…

Child Labour Concerns in Battery Supply Chain

  • A new report from Amnesty International and African Resources Watch has raised concerns about child labour in the battery supply chain
  • The report states that “very few” companies are taking the required steps in due diligence, particularly in relation to the mining of cobalt
  • Amnesty accused major global organisations, such as Apple, Samsung and Sony, of “failing to do basic checks to ensure that cobalt mined by child labourers has not been used in their products”
  • Cobalt is not currently covered under the US Dodd-Frank Act, which is limited to tin, tantalum, tungsten and gold

Read more at The Financial Times

First Stage of “Space Data Highway” Launched

  • A node was launched into space on the back of a communications satellite on Friday, which was the first part of Europe’s new space “data highway”
  • The European Data Relay Satellite (EDRS) has been planned as a way to increase the volume and speed of data transmission, as it doesn’t require the relay from an Earth-based ground station
  • EDRS-A node will relay data, including picture and radar images, that will be used to monitor floods, sea ice and oil spills
  • The system, costing Euro 500 million ($545 million; £380 million), will also be available to paying customers once it is fully operational

Read more at Business Standard

Peugeot Signs Iran Manufacturing Deal

  • PSA Peugeot Citroën has signed a deal which will mean that three of its current models will be manufactured in Iran over the next five years
  • The deal, a Joint Venture between PSA and Iran Khodro, is expected to invest up to €400m over the next five years in manufacturing and R&D
  • Manufacturing of the latest Peugeot 208, 2008 and 301 models will take place in Tehran, with the first completed vehicles expected in 2017
  • It comes just a week after economic sanctions against Iran were lifted, and means a return for Peugeot to the country where it manufactured vehicles up until 2012

Read more at Supply Management

Google Plans to “Beam 5G” Using Drones

  • Google is building and testing a fleet of solar-powered drones capable of beaming 5G signals for mobile phone networks
  • Codenamed “Project SkyBender”, the drones will be able to transmit data up to 40 times faster than standard 4G, through the use of cutting-edge wave technology
  • The drones are being manufactured by the Google Titan part of the organisation, formed following Google’s acquisition of Titan Aerospace in 2014
  • It is hoped that these drones will enable Google, and other providers, to bring the internet to remote areas around the world

Read more at The Verge

Procurious Big Ideas Panel Discussion #4 – What Are We Doing to Create Communities of Practice?

What is the procurement profession doing to create communities of practice?

Building on Tania Seary’s keynote speech and the idea of collaboration across the procurement profession, David Noble, Tania Seary, Diego Barilla and Sue Steele discuss what can be done to bring a dispersed community together.

From spend entrepreneurship to professional accreditation and certification, the final discussion panel at Big Ideas Summit 2015 threw up some interesting questions and answers and got the wider group thinking about how we can help to map our future.

Watch the full discussion here.

See all the keynotes and panel discussions from the Big Ideas Summit, plus Big Ideas from our 40+ Influencers.

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

Buy vs. Lease – The Sharing Economy and Procurement

It was tarnished as a fad, or worse still, a hipster trend. But the ‘sharing’ or ‘collaborative economy’ is here to stay. This new purchasing practice is changing the way we consume products and services in our daily life.

Sharing-Economy

There is hardly an article about this new economy that doesn’t discuss the way that companies like AirBnB and UBER are disrupting consumer markets.

The number of Americans who have taken part in the sharing economy has grown by 20 per cent in the last 18 months. You would be hard pushed to name another sector that has seen a similar increase.

What is the Sharing Economy?

For the uninformed, the sharing or collaborative economy refers to the peer-to-peer sharing of goods and services (normally in place of purchasing outright), and is generally facilitated through a community-based online platform.

As is highlighted above, the sharing economy has gained a lot of traction in consumer markets such as accommodation (AirBnB), transport and ride-sharing platforms (UBER), and business funding (KickStarter). There are many, many more examples.

What is less clear is how or, perhaps more importantly, when these new purchasing practices might find their way into common procurement practice. Smaller organisations, or ones with less formal procurement processes, have allowed the use of businesses like AirBnB for business travel, although this is far from the norm.

Procurement has been doing it for years

But it poses an interesting question – is the sharing economy really any different from the age-old procurement question of ‘buy vs. lease’?

‘Buy vs. Lease’ is one of the key decisions frequently made by procurement, irrespective of the industry in question. For example, when an outlay was required for a new asset, say vehicles or fleet, the ‘Buy vs. Lease’ question would be asked (and usually answered by senior decision makers) as to whether the goods should be bought, or merely leased as required, leaving the maintenance and up-keep to someone else.

Building Furniture in Berlin

This cross over between big business procurement and the small-scale personal sharing economy was highlighted brilliantly on a recent trip one of the Procurious community made to Berlin (and was kind enough to share with us!).

Friends of theirs had recently returned to Germany after seven years living in Sydney, and had moved into a new flat. The flat came completely unfurnished (no curtains, no lights, no kitchen cupboards), so significant furniture construction was required before they could fully move in. Some of the new furniture was ubiquitous IKEA gear, and thus required nothing more than an Allen key and a lot of patience to construct.

However, other items required more work and, importantly, more tools. This included an orbital sander and other wood working tools to alter a chest of drawers so that it would fit into a small space inside the new flat.

Ordinarily this would have required a trip to a hardware store and a large outlay on new equipment that would subsequently lie redundant for years to come. But in Berlin, and many other cities around the world, there is app called peerby that can help. The app allows individuals to connect with other people locally and lease/borrow items they have (at a small cost), rather than buying their own.

Cost Considerations

Interestingly, the considerations for Buy vs. Lease are the same whether you are constructing furniture in Berlin or buying plant equipment in for a mining company in Western Australia. In order to make a good decision, buyers should consider how often they’ll use the product, how core it is to their operations (if you plan on doing a lot of woodwork, maybe its worth buying the orbital sander), the cost per use, and when the product will become obsolete.

It seems the sharing economy has merely brought an old procurement process (Buy vs. Lease) to the consumer market, meaning that purchasing practices that previously could only be leveraged by big business are now available to recreational (perhaps that’s the wrong word) furniture builders in Berlin.

It remains to be seen whether or not these practices will cycle back round again in the procurement world, but under the guise of the sharing economy.

Smart Cities – Revolutionising Public Procurement in Barcelona

Barcelona – a city of churches, tapas and endless Gaudi landmarks – boasts an intriguing procurement initiative that is fundamentally changing public procurement methodology. 

Sagrada-Familia-1100x688

The concept is new and the way changes are being made is a stroke of genius. Traditionally, public procurement initiatives have looked something like this:

  1. Determine the problem
  2. Determine a solution
  3. Develop a scope of work containing detailed specifications as to how the problem should be solved
  4. Go to market to see who can meet your specification.

Decision-making is generally carried out within the four walls of a government building and leads to nothing more than a race to the lowest price point between two or three large suppliers.

Turning Public Procurement on its Head

Barcelona has completely flipped this process. Rather than telling suppliers what they want, they are simply outlining problems that are present within the city (like bicycle theft or potholes in the road) and asking the public to come up with innovative ways to solve them.

By opening civic problems up to the cities entrepreneurs, Barcelona is leveraging a vast pool of innovation and creativity that resides within its city. The following quote by CityMart‘s (the organisation behind this initiative) CEO, Sascha Haselmayer, sums up the approach brilliantly.

“City governments need to get out of procuring by specifying the solution they want. They can’t possibly have enough knowledge to do that well. What they should do is specify the problem they want to solve and show metrics on what success looks like. And then allow the market to inspire them to find the best solutions.”

As well as suggesting product solutions, applicants to the BCN Open Challenge are encouraged to challenge current city regulations and services in order to address six of the city’s key civic problems. Essentially, the canvas is blank and creativity, freethinking and innovation are encouraged.

The response to this initiative has been astonishing. Since Barcelona published its six city challenges online, the initiative has received over 50,000 views and more than 100 official submissions. CityMart stated that a benchmark number of views for public procurement contracts of this nature would normally be around 7,000.

Boost for Small Business    

In a country whose economic woes are well documented, this initiative provides a vital lifeline to Barcelona’s small and medium sized organisations. CityMart claim that 98 per cent of all ‘open procurement’ projects listed on it’s website are awarded to small and medium sized organisations.

This is a significant contrast to traditional public procurement tendering practices; where long lists of specifications and pre-requisites along with protracted contract award cycles, rule out all but the largest and most established suppliers from winning public contracts.

When you consider that city and community spending globally accounts for $45 USD trillion a year (yes that’s right…TRILLION!), you begin to get an understanding of the impact this sort of initiative could have for small businesses across the world.

An Engaged Community

It’s not just small business that benefits from the new model Barcelona has implemented. The project is making huge progress in improving community engagement. The city defines its problems in conjunction with its citizens, encourages these citizens to suggest solutions, and then uses tax payer funds to provide a work space from where these problems can be solved.

If that’s not effective community engagement, we don’t know what is. The project’s tagline is ‘Open for business. Open for innovation’ and it certainly holds true.

While opening a city’s problems up to the public certainly encourages innovation, community engagement, and supports small business, it’s important not to overlook the financial benefits these projects can create.

Global consultancy firm McKinsey has estimated that city governments can reap savings of up to 10 per cent by opening up procurement contracts and leveraging innovative community based problems solving.

Don’t tell your suppliers specifications…ask them for solutions

All procurement teams can learn something from the work that is happening in Barcelona. Procurement professionals could all benefit from being a little less prescriptive in telling suppliers what it is they want. The power is in admitting that these teams alone can’t possibly come up with the best solution to every business problem they face.

But how can professionals possibly know what they want when they don’t know what’s out there? By admitting their ignorance and opening up problems to more people, it is possible to leverage the vast creativity and innovative power that lies within communities.

So move your discussions away from specifications and prescriptive statements of work, be more creative and stop telling people what you want and start asking for solutions.

Think Quality Over Price When Purchasing Corporate Uniforms

Price isn’t the most important element of a uniform negotiation, according to a disruptor in the Australian uniform industry. 

Cargo Crew

An award-winning Australian uniform market disrupter has urged procurement professionals to think twice when considering haggling on price for the company’s corporate attire.

Melbourne’s modern uniform manufacturer, Cargo Crew, reveals that while procurement is far more than just being about price these days, some negotiations start and finish with price and deadline requirements. Other procurement professionals appear to be more progressive in their approach, treating the transaction as a partnership rather than a mere supplier by looking for ways to cement a strong relationship from the outset.

Choosing Quality

“We’re dealing with procurement professionals in increasing numbers, and want to help them understand the benefits of a quality uniform, which has the potential to transform the entire image of an organisation overnight,” client service director, Narelle Craig, says.

“You should never under-estimate the importance of the corporate uniform when you’re next in the market for an upgrade.

“When it comes to uniforms, price should not be the most important factor. We use audited factories to manufacture our product line, have ethical certifications not to mention using the highest quality materials and a client care team, and all of that comes at a cost. But it delivers huge value to an organisation, and removes a lot of the headaches felt by procurement professionals who have countless things to consider when ordering a uniform,” Craig says.

By choosing a quality uniform, procurement professionals are saving their company money in the long term. This is because they don’t have to replace their uniforms as often, saving the resources to coordinate re-ordering uniforms, and lessens the number of staff complaints that their uniform isn’t wearing well.

‘Fashion-Forward’ Uniforms

Cargo Crew was launched in 2002 by Craig’s sister, Felicity Rodgers, who as a fashion designer noticed a gap in the market for fashion-forward uniforms.

The business has flourished since launching its first range of Denim uniforms in 2012. Cargo Crew has dressed growing numbers of corporate Australian and New Zealand organisations including staff at Renault, Freedom Australia, ME (the bank), Dulux Group and SkyBus.

Comfort, the breathability of the fabric, attention to details such as longer length tees and shirts so staff can reach comfortably in the line of duty is paramount, Rodgers says.

“A uniform completes an organisation’s corporate story and reflect what the business stands for. Staff need to feel really good about what they wear, and again, that comes at a cost. Procurement people need to keep in mind the style, look and image they want to reflect in their brand,” Rodgers says.

“We set out to create a uniform brand that not only filled a gap in the market, but also excited and engaged our audience.”

The business is also investing heavily in operations under the watchful eye of Paul Rodgers (Felicity’s husband), who is focused on business efficiencies such as warehousing space, online ordering platforms, reporting and client management.

Cargo Crew Team

The Cargo Crew Lead Team (l-r): Paul Rodgers, Felicity Rodgers, Narelle Craig

Direct to Client Sales

Cargo Crew differs from other uniform suppliers in that it cuts out the middle man, selling a retail-quality product direct to the client rather than to a wholesaler to on-sell.

The business won the 2015 Telstra Australian Small Business of the Year Award for developing a product range with flair usually lacking in the wardrobes of corporate Australia. The Telstra Award comes on the back of 44 per cent overall sales uplift year-on-year and a growing number of corporates interested in their product, which boasts 60 variations.

In the past six months, the company’s stock holding size has grown six times. The world is sitting up and taking notice, too, with interest and orders coming from Italy, USA, UK, China, Hong Kong, Singapore, Japan, Sweden, France and more.

The emphasis on style has seen the Melbourne-based business with an online store transform the modern uniform since the company launched 14 years ago. Cargo Crew now employs 18 staff.

“We’ve noticed both small and big competing businesses try to mimic our style, brand and product range, which is actually a big compliment, but of course brings its own set of challenges to the table that we’ve had to deal with.”

Cargo Crew has increased the partnerships it has, expanded its range, held a pop-up event in Sydney and even started its own publication, The Crew Review. It also has plans under way to develop a new division of the business for corporate clients, soon to be announced.

Will Amazon Over-Stretch Its Supply Chain with ‘Dash Replenishment’?

Back in March last year, when Amazon announced its ‘Dash’ button service, many people thought it was an early April Fool’s joke. As it turned out, the online giant was completely serious.

Amazon-Dash-Tide

The first Dash devices went live this week and, although currently there are only a small number of products available with Dash Replenishment, it’s clear that Amazon has plans to expand its range and deliver another service that promises to disrupt and change the way we shop for frequently used goods.

Dash Button Partners

For those of you who don’t know, the Amazon Dash Button is a wifi-enabled electronic device, aimed at making re-ordering commonly used consumables and household goods easier. Each Dash Button is unique to a specific product, and when the button is pushed, an order is placed for that product through the user’s Amazon shopping app.

The Dash Buttons exist in two formats. First, the Buttons are built into electronic equipment (think printers, washing machines, etc.) and are used to reorder consumables specifically for that equipment. The second format are buttons, sold individually, for specific products (washing powder, toilet roll) that users can leave in convenient places around the house to assist with their shopping.

To begin with the Buttons will only be available on request to Amazon customers who are already registered for Amazon Prime. Once requested, customers will then link the Buttons to their existing accounts.

To date, Amazon has announced Dash deals with a number of electronics manufacturers, including Samsung, Whirlpool and Brother, as well as with large FMCG organisations like P&G, for products like Tide and Bounty.

Supply Chain Pressure

It is a testament to Amazon’s willingness to push the boundaries of their business model that they would even try this sort of service. Not known as a site where household items are commonly purchased, Amazon are looking to leverage their experience in current activities and try to change our shopping habits. Again.

However, some experts have warned that Amazon might be putting too much pressure on their service management systems and supply chain by introducing another service that is built around fast delivery and high levels of customer service.

With an increasing number of customers using Amazon’s Prime next-day delivery service, the launch of Amazon Prime Now one-hour delivery in some cities around the world, not to mention the roll-out of Prime Now Restaurant delivery in some American cities, it’s not difficult to see where issues may arise.

Neil Penny, product director at Sunrise Software, comments: “Amazon’s Dash Replenishment is the retail giant’s foray into instant gratification and user convenience, with the model using connected devices to potentially provide limitless access to products while also removing any effort from the user themselves.

“However, the more seamless and predictive a service appears, the more work must go on in the background to meet these mounting expectations. While the idea is great on paper, it is questionable how realistic it will be for most firms with their current fulfilment strategies.”

Customer Expectations

As with anything else that Amazon does, customer expectations will be high. The retailer will have to work hard to ensure that the expectations are met for both product availability and delivery times.

In order to make sure that this venture succeeds, Amazon will have to work closely with its own service providers and supply chain to ensure that the products currently available under Dash Replenishment are available when required, and that the service providers can meet deadlines for stock delivery, delivery capacity and order prioritisation.

And should the current model succeed, it may see Amazon expand the products available, both for the inbuilt and individual buttons, as well as having other companies follow suit with their own products.

Penny states, “While Amazon’s new service is launching with products like print and washing supplies, the automatic model is likely to see widespread adoption across other companies and industries in the next few years.  With IoT-enabled devices becoming increasingly more commonplace, more firms will come under pressure to adopt similar approaches.

“Being able to keep track of the complex web of suppliers and service level agreements and respond to demands quickly will be an absolute requirement for any service provider hoping to keep up with demand.”

Migration, Terrorism and Industry 4.0 – Highlights from WEF 2016

Almost a year ago to the day, Procurious published an article on the outcomes of the World Economic Forum 2015. We also took a look at the key topics that were to be discussed during the 2015 event.

WEF 2016

You might be forgiven for thinking that, since the leaders from the world’s largest economies gathered in Davos twelve months ago, very little has changed. There are still major issues with global markets, falling oil prices, interstate conflicts and climate change.

Add to these factors the growing migration from war-torn regions, and terrorism, both on the ground and cyber-related, and it was a recipe for a very busy Forum.

What Was Different?

Despite all the pressing issues highlighted above, the WEF organisers picked a different topic to be the main theme for 2016 – Industry 4.0. This topic focuses on the so-called “Fourth Industrial Revolution”, where industries are increasingly digitised, and humans are replaced in many professions by robots or AI.

While this might be a positive thing for some of the attendees, including Jack Ma (Founder of Alibaba), Sheryl Sandberg (CEO of Facebook) and Eric Schmidt (Head of Alphabet, Google’s parent company), it is potentially very bad news for both blue and white collar workers, with an estimated 7 million jobs at risk over the next 5 years in the world’s largest economies.

Klaus Schwab, founder and president of the WEF, has written a book on ‘Industry 4.0’, in which he states, “We stand on the brink of a technological revolution that will fundamentally alter the way we live, work, and relate to one another.” This theme also included a discussion on ‘smart machines’ being used in war zones.

What Else Was on the Agenda?

A number of other major themes appeared on the agenda, including terrorism, the migration crisis, cybercrime, and the on-going impact of the slowdown in the Chinese economy on the financial markets of the rest of the world.

In the run up to the 2016 event, the Global Risks Report published by the WEF highlighted large-scale ‘involuntary migration’, for example from civil wars, as this year’s major risk in terms of impact, and mitigation of climate change as the most likely global risk. This is the first time that an environmental issue has topped this particular list.

Climate change was one of the hot topics of the Forum, as leaders discussed the next steps and how to build upon the COP Climate Change Agreement that was signed in Paris in December last year. Global climate change is seen as having a major impact on other risks, such as food and water shortages and regional conflict, so the topic was never far from the centre of discussions.

Anything else?

Leaders also managed to find time to talk extensively about the global markets, including the impact of the slowdown in the Chinese economy. Christine Lagarde, managing director of the IMF, spoke on Friday about the need for Chinese authorities to communicate better with global markets over moves in equities and foreign exchange markets, in order to head off any further market downturns.

However, it’s not all bad news, as Lagarde stated that China’s move from an export-led to domestic consumer market economy was “manageable”, while holding estimates for Chinese growth at 6.5 per cent. It’s hoped that this turnaround will arrest fears of another global recession.

Major Conclusions

As the Forum drew to a close on Friday, there was a sense that 2016 could be a year of major upheaval, with markets not expected to recover immediately, slow growth predicted for at least the first half of the year, and a solution still required for mass migration.

However, there also appeared to be a feeling of tangible outputs from a business point of view. The central theme of ‘Industry 4.0’ raised interesting points around the future of many industries, and in a number of sessions, there was agreement that business needed to step away from a narrow focus on profits and take steps to improve workers’ conditions, promote diversity and take a perspective that covered a wider group of stakeholders.

It will be interesting to see if we are still talking about the same issues when the 2017 Forum rolls around in 12 months.

Need some headlines and stories for your morning coffee with your friends? Procurious has got you covered…

BMW Top Sustainable Corporations List

  • BMW has topped Corporate Knights Magazine’s annual ‘Global 100’ list of sustainable corporations for 2016
  • The study looks at companies with a market valuation of $2 billion or high, and scores them against global industry peers on a list of 12 quantitative KPIs not exclusive to to environmental sustainability
  • Companies are scored on these KPIs, and the top performer from each industry outlined in the Global Industry Classification Standard goes to the final list
  • 2016’s list also included Dassault Systemes (Ranked 2nd), Outotec (3rd) and Commonwealth Bank of Australia (4th)

Read more at Corporate Knights

Thai Shrimp Migrant Workers Risk Being ‘Sold Off’

  • Following a number of high-profile reports and news headlines, the Thai shrimp industry is cleaning up its supply chain, but with unintended consequences
  • Migrant workers, the subject of many of the headlines, are being laid off without any form of compensation, leaving them at risk of being “sold off” to other companies
  • Activists claim that some workers are still in debt to their employers, and have just been moved on to another industry and face similar conditions
  • Firms are now being urged to offer these workers employment in the regulated operations

Read more at Thomson Reuters

Changing Thrift Shopping in Vancouver

  • A new business has been launched in Vancouver to change the way residents approach thrift shopping in the face of ‘fast fashion’
  • ‘My Modern Closet’, founded by Chloe Popove, is the first consignment store to offer people donating to the business a collection option, with customers then being given 20 per cent cashback or credit to shop online
  • It is hoped that the business will encourage more people to donate used or unwanted clothing and fight the impact of fast fashion
  • Any un-sold clothing is donated on to charities helping to give clothes to the homeless, and to Syrian refugees

Read more at Vancitybuzz.com

Starbucks Mobile Ordering Hits 1m Users Per Month

  • Starbucks has revealed that it is processing over 6 million transactions per month on its mobile app, as more people use it to order their coffee
  • In the final quarter of 2015, 21 per cent of all orders in the US at Starbucks were placed through the app, and this is expected to grow this year
  • First launched in Portland in 2015, the service is now widely available across the USA, Canada and the UK
  • The coffee giant is now looking to extend the service by offering delivery of coffee to users of the app

Read more at NBC News

Procurious Big Ideas Panel Discussion #3 – Are Business Costs Too High or Too Low?

Are business costs too high? Or too low? And where does procurement sit in this matter?

The third discussion panel at the Big Ideas Summit 2015 took place in the innovative format of a ‘fishbowl’ discussion, where participants argue both sides of the lead question, but where the audience can also get involved.

The panel started with Chris Lynch, Theano Liakopoulou, Chris Sawchuk and David Noble, gradually interchanging the other thought leaders as the discussion progressed. In an often heated environment, a number of hot topics were raised and some great insights released.

Watch the full discussion here.

See all the keynotes and panel discussions from the Big Ideas Summit, plus Big Ideas from our 40+ Influencers.

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

5 Things You Need to Know About Working in Germany

When you think of Germany, pretzels, beer and BMWs are common stereotypes that come to mind. But there is much more to Deutschland than that – especially if you are planning to work.

Reichstag

A country built on research, innovation and its ability to attract foreign direct investment (FDI), with the biggest economy in Europe and the fourth largest in the world – who wouldn’t want the opportunity to work in Germany?

Not only home to many of the European and Worldwide market leaders, recent figures show more than 45,000 foreign companies are also conducting business there. Although many more factors have helped shape German industry, this structure has consequently had deep impacts on the Procurement (Beschaffung) role.

The Need to Know

Procurious founder, Tania Seary, recently had the opportunity to meet the leadership team from the German Association of Materials Management, Purchasing and Logistics (BME) in Frankfurt. BME have established themselves as a professional association for buyers and logistics, supporting members in developing new markets and the configuration of economic processes.

According to BME, there are more than 100,000 procurement professionals working in Germany, so here’s what you need to know if you’re looking to join them:

  1. Germans can be considered the masters of planning

Doing business in Germany without adequate cross-cultural awareness is a risky proposition, and businesses should ensure they carry with them an appreciation of both the business landscape and the culture. Hierarchy is highly valued in Germany, and there are often myriad procedures and policies which can slow things down, so having a bit of patience is crucial to the success of business negotiations.

The desire for orderliness spills over into the business life of Germans – surprises and humour are not welcome! According to the German Business Culture Guide, everything is carefully planned out and decided upon, with changes rarely occurring after an agreement is made.

  1. Get used to some straight talking

There are cultural differences at play. The German business culture is perhaps less instantaneous than in countries like the UK, and personal relationships that are developed slowly over time are seen as a more desirable way to do business. Don’t be surprised if you jump straight into business talk, as there is little time for small talk.

  1. A series of villages, not really a country

Germany is a country with a long history and vast cultural differences throughout. For a country of its size (only 357,000km² – Australia is 21 times bigger), it has 16 states and over 400 districts.

This means you’re going to need to recognise the contrasts across the country, especially as industry is fragmented and big companies operate often in small villages. Although complex, this presents a fantastic opportunity to learn how to work with, and understand, different cultures – a brilliant training ground for future leaders.

  1. If you’re a social media nut – this is a different landscape

By sheer numbers, social media is as popular here as the rest of the world. According to the EU’s “Passport to Trade” more than 75 per cent of all Germans over 14 years of age use the Internet in some way, and 90 per cent of 14 to 29 year olds are on social media.

What is different about social media in Germany is the popularity of the local, German-only networks, in addition to the global players. The most popular networks listed according to their number of users are (get ready – you may not have even heard of some of these):

  • Facebook
  • Google+
  • Xing
  • Wer-kennt-wen
  • MeinVZ/StudyVZ
  • LinkedIn
  • MySpace
  • Lokalisten.

Up until 2009, there were up to 15 million German-speaking users on a German language network resembling Facebook called StudiVZ. But Facebook eventually conquered Germany (as it has for most of the world), as it enabled users to socialise and interact with people outside Germany too.

There is a Russian joke that says:  “Twitter can’t be popular in Germany, because 140 characters are basically two words in German.”  There are certainly enough short words to compose tweets in German, but when you read that only 10 per cent of Germans use Twitter, it makes you think there might be some truth to that joke.

With words like “kraftfahrzeughaftpflichtversicherung” meaning ‘car liability insurance’, and “donaudampfschifffahrtsgesellschaftskapitaenswitwe” meaning ‘widow of a Danube steamboat company captain’, let’s hope Twitter changes to a 15,000-character limit soon!

  1. And your role in procurement…

Procurement is not the only function of choice – it’s one of hundreds – and, if you’re coming from a large multinational corporation, a word you need to understand and add to your vocabulary is “Mittelstand”.

We often throw in terms like MNCs and SMEs (small and medium-sized enterprises) around when asked who your employer is, but statistically what is the real difference?

Statistically, any business with fewer than 500 employees is classed as an SME. However, in Germany this would mean that 99 per cent of businesses would fall into this category.

So the Germans created the world “Mittelstand”, which can refers to both SMEs and much larger companies, if they are run in the same spirit. This typically means the owner or owners take business decisions largely on their own, but retain close ties with both the business and the employees.

This involvement with the business applies to over 3.6 million “Mittelstand” companies, providing more than 60 per cent of all jobs in Germany, and making up 53 per cent of the country’s GDP. So the chances are you’ve already conducted business with a potential employer.

There you have it – some top tips for working and doing business in Germany. And if you’re looking for a job there, or plan on working there in the future, good luck (or as the Germans say…viel Glück!)


Useful links:

Working in Germany: Getting a German Work Permit

EU Blue Card Germany

Labour Market Figures Suggest Need for New Approach to Skills Gap

The Open University says businesses and universities must work more closely to address skills shortages.

Skills-Shortage-Graduates

Figures released today show that the UK continues to face up to a worsening skills crisis. Despite the overall rise in job creation, the vacancy rate continues to increase, and is particularly acute in specialist areas such as IT and engineering.

The latest Labour Market Figures, produced by the Office for National Statistics (ONS) reveal there are 588,000 more people in work than this time last year, but that there has been a 6 per cent increase in the number of unfilled roles over the same period, as there are now 756,000 vacancies.

Concerns for Businesses

The on-going shortage in skilled workers is increasingly causing concern for businesses. Decision makers are facing up to the effects of this market on their businesses: hard to fill vacancies can cause delays in developing new products and services, meanwhile the latest CBI/Accenture Employment Trends Survey, published last week, reveals that over half (52 per cent) of respondents believe that developing and maintaining digital skills within their organisation has a new urgency in this climate.

Despite there being over 2 million students enrolled on degree courses in 2014/15, with a 3 per cent increase in full-time first year enrolments in engineering and technology subjects, businesses often find that graduates are not adequately prepared for the workplace.

The skills gap is affecting UK productivity, for instance, engineering companies have reported an annual shortfall of 55,000 skilled workers. It has been estimated that addressing the shortage of skills in this area could generate £27 billion per year from 2020, roughly equivalent to 1,800 new secondary schools or 110 new hospitals. 

Issues for Small Business

Michael Martins, Economist at the Institute of Directors said: “These jobs figures, which show the British labour market ended 2015 strongly, could be just what the doctor ordered as we see nothing but storm clouds gathering across the global economy.

“While this is clearly good news and the increasing number of vacancies means that the unemployment rate could continue to drop, addressing the skills gap takes on a fresh importance. For small firms that employ fewer than ten employees, the struggle to find workers is particularly acute, with vacancies rising by 13.1 per cent in the last quarter.

This is another reason why employers hope the government will not follow through on suggestions to restrict skilled migration from outside the EU, especially as the monthly quota for Tier 2 visas has been shown to be inadequate in addressing skill shortages.”

An Answer in Workplace-Based Education?

The Open University is arguing that a greater emphasis on workplace-based higher education is necessary to create more value for businesses and individuals alike. Steve Hill, Director of External Engagement at The Open University, comments: “The skills gap is affecting everyone, holding back businesses and having a knock-on effect on British economic productivity.

“In most cases, the answer to this shortage is right under our noses – with up to 90 per cent of the current workforce still in work over the next decade.  With the right training and up-skilling, these individuals can become the engineers, data scientists and high-skilled digital workforce the UK needs to compete on the world stage.

The challenge now is for Governments and the academic sector to work together to develop courses that meet the needs of businesses, and provide the right support for those committed to developing their careers.”

The OU regularly supports over 1,300 organisations, including KMPG, Hay Group and the NHS, delivering flexible learning solutions at scale to address skills shortages and develop high performing workforces. With a global reach and as the UK’s leader in part time education, with 76 per cent of OU’s current students studying whilst working full or part time, the OU is well equipped to deliver consistent learning at scale to dispersed workforces.