Tag Archives: procurement technology

7 Warehouse Management Tips to Improve Inventory Control

In every business, there is one silent player that can absolutely make or break your operation — the warehouse. 

Warehouses  form the nucleus of numerous businesses and it is imperative that they are managed efficiently. However, its size and structure can become overwhelming if not managed properly. You can manage it efficiently by implementing a warehouse management system, with which you can control the movement and storage of the materials within the warehouse. Additionally, you can incorporate tasks like transportation management, accounting systems, light manufacturing, etc.

Managing inventory effectively and maximizing warehouse productivity rank on top of the priority list of almost all the warehouse managers. If you are one of them, these 7 warehouse management tips will help you in improving inventory control and achieving effective warehouse management.

  1. Plan An Efficient Layout

The warehouse layout must be carefully planned out in order to maximize storage space. You must arrange the space in a manner that allows you to move smoothly and with ease while carrying goods around the warehouse. You must keep enough space to maneuver the forklifts and weight carrying machines around without any hindrances. Mark the bins and place them in a planned manner to avoid confusion and stocking of goods at inappropriate places. The right layout will also help in minimizing safety hazards.

  1. Stock Inventory As Per Need

You must arrange your inventory based on how and when you use/need it. You shouldn’t hoard inventory unnecessarily throughout the year unless there is a regular demand. Keep the stock levels at 1.5 times the average for avoiding blocking of working capital. With optimised inventory holding, you can effectively reduce the cost of storage. You can study historical trends as a part of your warehouse management process to forecast the inventory need.

  1. Apply Cross Docking to Maximize Space

The objective of cross docking is to reduce the shelf storage time of stocks in the warehouse. It helps in transporting warehouse delivered goods quickly to the outbound carriers that can take the stocks to distribution centres. You have to ensure that the warehouse layout supports cross docking.

  1. Implement Strict Standards for Safety

Don’t make your warehouse an unsafe place for your employees. If your staff isn’t trained properly, you will have numerous accidents and high injury rates. Ensure that only the well-trained and experienced employees operate heavy duty equipment such as forklifts. Mark the safety protocols in the warehouse, such as indicating a safe distance from danger zones.

  1. Incorporate Efficient Weighing Systems

Make efficient weight scales, such as truck scales, an integral part of your warehouse as it helps in optimising all the weighing processes. You can improve the accuracy of the billing and shipping tremendously, thus increasing the revenue. The overall workflow productivity is also enhanced.

  1. Use Technology to Enhance Inventory Management

Technology is a good friend to have in the warehouse. New robotics technology has become the most sought after technology in many companies. You can partner up with warehouse management systems and create customized software and smart robots that can help in managing the movement, storage and sorting of warehouse inventory. Automated vehicles come a close second. By incorporating self-driving technology in the warehouses, you can reassign human labor to more critical jobs and enhance safety and efficiency.

3D printing technology allows on-demand production of various components for manufacturing at the location itself. It can effectively eliminate the need for any transportation, thus reducing the cost and lead times significantly. Innovation of newer, lighter and stronger materials like nanotubes and graphene is also exciting news for warehouse and logistics management. You need less energy to transport lighter materials and equipment. To make it even better, self-repairing finishes and self-assembling materials are already in developmental testing!

  1. Improve Demand Planning

Demand planning is a crucial part of forecasting inventory purchases, stock requirements and customer buying trends. This helps in optimizing inventory levels and meeting the demands of the customers at the same time. When the demand planning is effective, you can track the sales trend history, product activity during specific seasons of the year, trends of various manufacturers and different rules of warehouse storage and business.

Don’t let the complexities of a warehouse wear you down. With careful and efficient planning, you can achieve your goals and manage every single warehouse with high efficiency.

Kevin Hill heads up the marketing efforts and provides technical expertise to the sales and service teams at Quality Scales Unlimited in Byron, California.

Are You A Procurement Starter Or A Finisher?

Are you a starter or a finisher? According to IBM’s Barry Ward, you’d better be both! Barry discusses the key skills most critical to procurement in the coming years.

Barry Ward, Procurement Brand Manager, Global Business Services at IBM is a keynote speaker at Big Ideas Summit 2017.  He’ll be explaining the big ideas behind Watson and the opportunities that cognitive tech presents to procurement. When we spoke to Barry ahead of the event he was keen to remind us that, despite rapid tech developments, traditional procurement skills are far from being made redundant.

How do you stay productive and current in a world of fast-paced innovation?

  • Collaborating with colleagues
  • Networking with others – using social media and other channels
  • Building and nurturing an ecosystem of organisations that are leading or developing solutions that may have or will have an impact in your function

What key skills are critical for procurement in the next 5 years?

We will always need traditional procurement skills such as the ability to be a strong negotiator, to communicate well internally and externally, to be a starter and a finisher. But, on top of this I think the importance of an open mind and curiosity in terms of the role that technology can play in the future is going to be more important than ever.

There will be an increasing need for project management skills, change management, relationship management skills. This is on top of the usual and still critical traditional procurement skills such as category expertise or negotiation skills. I can also say that there is a growing importance in soft skills: communication, teamwork and collaboration and problem solving.

How has technology, the Internet of Things and e-Procurement affected IBM?

Technology has placed a key role in IBM’s transformation over the past 20 years or so. Its importance is perhaps more critical in the the current phase of our procurement transformation. Understanding how digital technology can transform the supply chain and our source to pay activities is critical in terms both driving our efficiency and effectiveness but also to showcase how procurement can drive value throughout our organisation.

This positions Procurement in a much more strategic role than ever before. Procurement data is much more visible than ever before.  Insights through combining unstructured and structured information augment our knowledge, with alerts being posted to mobile devices instantaneously means that buyers can have much better assurance of supply continuity, of being able to understand price opportunities and to focus their time and energies on higher value activities than ever before. Lower value work will become automated or systems-driven. This is all good news for Procurement.

One clear impact of this transformation is that our key stakeholders now have very high expectations of high performance from Procurement personnel, perhaps more so than ever before, but the rewards are clearly evident in terms of the value that individuals can bring as well as the procurement organisation as a whole.

How valuable have mentors been in your career?

Mentoring is a highly personal thing. Some people need to have guidance and direction particularly in an organisation that may be widely spread and fast-moving, and if you are looking to move around different functions. Similarly for those who are in a smaller organization, mentors can bring an external, broader perspective.

Others are confident of their own abilities in charting a course for their own development and progression. I have had mentors in the past, particularly when I was in the early stages of my career. The more confident you are of your attributes and ambitions the less I have found that I needed mentoring. I spend time mentoring others mainly from within IBM and mainly from other geographies.

How did you first become interested in procurement?

I didn’t know very much about Procurement in my time as an undergraduate. It was not a profession that had much coverage when I was at University, unlike Finance or Engineering.

My first job as a business graduate was as a Purchasing Analyst running Bill of Material queries in a MRP system for a large manufacturer. This brought me into contact with many parts of the organisation including procurement. The procurement manager at the time was quite an intellectual and gave me a broad view of the role that procurement can play in an organisation.

Clearly he influenced me as I have spent my subsequent career in procurement and supply chain roles!

How will cognitive technology impact procurement professionals?

Cognitive technology will transform the role of the procurement professional and the impact that he or she can make for their organisation. It will be able to remove some of the more prosaic parts of the procurement role, such as data gathering and analysis, together with augmenting a buyer’s knowledge thus enabling them to spend more time on higher value tasks and ultimately make better decisions and be more effective.

Procurement professionals will need to understand how cognitive technology works – so they can be alert to potential mistakes that can happen from cognitive solutions, so that data input from these solutions is relevant and accurate.  It will eventually help, and force, them with their career progression as well as developing their expertise.

Join the conversation and register as a digital delegate for Big Ideas 2017

Cognitive Technology – One Giant Leap for Procurement?

Technology has helped to define the human race, from the invention of the car to the moon landings. Cognitive technology is one small step on the journey into the future.

Register as an online delegate for the London Big Ideas Summit 2017 here.

In 1961, US President John F. Kennedy said, “We chose to go to the moon.” People marvelled at the ambition of pushing the boundaries of human capabilities. After all, the technology to do this didn’t exist at the time.

Kennedy never lived to see his prediction come true, and watch as humans took that giant leap forward. Now, in the 21st Century, we come to the next advancement – cognitive technology.

It’s easy to compare the cognitive technology journey to the space programme and moon landing journeys of last century. For IBM, developing and deploying Watson is like the moonshot in the 1960s where IBM technology helped NASA make the lunar landings possible..

Cognitive technology is merely in its infancy in terms of where it can go. This journey will mostly likely take 50 years or more to be fully realised. And at the moment, we’re just in Year 1.

Millennials Will Help Take This Step

Procurement is starting its own cognitive technology journey and Millennials have the chance to be there at the outset. They will see cognitive technology evolving and developing throughout their whole career.

But first they need to know how to get on board and enjoy the journey.

At the same time, procurement professionals, and the wider workforce, are wondering what cognitive technology means for them. What’s left for procurement when cognitive systems like IBM’s Watson is the smartest guy in the room?

Without adapting and preparing adequately, procurement could easily be marginalised. But if CPOs lead from the front, identify the activities that only procurement can do, then procurement’s road will be much less rocky.

Now is not the time to be overwhelmed by cognitive technology, but to be educated. And to do this, we need to understand the key skills procurement professionals need to focus on to start preparing for the cognitive technology revolution.

Barry Ward, Procurement Brand Manager, Global Business Services at IBM, talks about five key skills below.

1. Watson Awareness

First things first, procurement professionals need to be aware of cognitive technology, and Watson, and what it can do for them.

The reality is that technology can change a job in four ways – eliminate, automate, empower, create. Far from being fearful for their jobs, procurement needs to embrace the change, and use it to enable the profession.

Traditional procurement processes such as cost optimisation, spend management and contracts can be empowered by Watson. Things that used to take days will now be done in a matter of minutes.

Watson can enhance these processes by analysing vast quantities of data, helping to improve the decision-making process. Through this, financial benefits can also be realised in this outcome focused structure.

Ward advises that professionals start with the categories that they manage, and understand how AI can be introduced (IBM refer to AI as Augmented Intelligence, using technology to enhance human knowledge and capability). Then it’s a case of learning as you go, and sharing knowledge with others to work collaboratively and to fully exploit the capabilities that the technology can bring

2. Relationships 

Cognitive technology may make computers super-intelligent, but it doesn’t mean consciousness or awareness. There will always be a need for the human touch in management of stakeholders.

In fact, as technology helps free up time for procurement to focus on strategic tasks, building relationships will become more critical than ever. For example, good supplier relationships will help procurement be more agile, ensuring they stay ahead of stakeholder needs.

Data can only take procurement so far. The rest is down to procurement doing the relationship work we always have done. Only now we’ll have more time to do it, and more information to help enhance the relationship.

3. Negotiation

As with relationship management, traditional procurement skills such as negotiation will also still be key. Watson can give recommendations for how to proceed, but ultimately it can’t make decisions for you. And you’ll always have the ability to correct it too.

However, Watson can help with providing data to enhance the negotiation itself. The system can give details on the person you are negotiating with, and help cut down the preparation time.

For example, if you were negotiating with Barry Ward, and you had done so in the past, Watson would be able to tell you what these previous experiences were like. Like what Barry does in certain circumstances, for example.

There’s less dancing around, you can get straight to the point, all of which saves you time. Plus, you’ll probably get a better deal out of it too!

4. Understand your organisation’s cognitive technology journey 

Find out what your CIO or CTO is doing, and what their plans are for the organisation in terms of cognitive technology. You can ask what the digital transformation will look like, and then think about how to prepare, or even influence, it.

Professionals can assess their own category, and establish what cognitive solutions are available in the market place. The key is learning how cognitive technology might specifically benefit your area.

For example, if you are travelling and your plans change, cognitive technology can assist. All you do is put the details into your phone, and the technology will assess the change, look at your airline and hotel preferences, and then present a plan, complete with cost, for your approval. All without lifting a finger. In truth, these systems are probably a couple of years away yet, but they will fundamentally change the way some categories are managed.

5.  Be Data Savvy

Finally, professionals need to be savvy in terms of knowing what cognitive technology can do for them in terms of data. As we have said, Watson is capable of handling structured and unstructured data, photos, contracts, documents, and even audio files.

The system can make sense of the data, and provide solutions based on combinations of data you’ve never even thought of. The quality of decision-making is improved, and previously unattainable insights are freely available.

We are only just discovering the possibilities that technological advances will bring but it is clear that digital transformation will open up huge opportunities for us all. This will be an exciting time to be in Procurement !

Barry will be  explaining the big ideas behind Watson and the opportunities that cognitive tech presents to procurement at  Big Ideas 2017. Register as a digital delegate.  

A Whole New World: The Cognitive Computing Era

The age of cognitive tech is coming, whether procurement likes it or not! How can we be ready for the changes coming our way? 

Register your attendance for our free webinar, Man & Machine, which takes place on 8th February 2017. 

A New Era Of Computing

 We’ve entered into a new era of computing: “the cognitive computing era”, which follows the eras of programmable and tabulating systems and represents a massive jump forward that will transform how enterprises operate.

This new era is defined as such because there is a fundamental difference in how these systems are built and how they interact with humans. Traditional programmable systems are fed data, knowledge, and information, and they carry out and return results of processing that is pre-programmed. In this case, humans are doing most of the directing.

Cognitive technology is different; it accelerates, enhances and scales human expertise to solve more complex problems by understanding language and interacting more naturally with humans. It can reason to find patterns and form hypotheses, making considered arguments and scenarios planning. And this is exactly what Watson is about.

Watson is a cognitive technology that can think like a human and is available as SaaS products and a set of open APIs (Applications Programming Interface) such as natural language classifier, speech to text, text to speech, visual recognition, etc.

What Does Watson Mean For Procurement?

This disruptive technology, by creating a new digital ecosystem, is pushing Procurement to create a new business model, moving away from objectives centered on cost take out and taking a new customer centric and revenue growth approach. CPOs must employ the right strategy, structure, skillset and cognitive technology if they want to be in a strong position to demonstrate their relevance and value to the organization.

Procurement organizations and their leaders need to embrace the reality and potential for Artificial Intelligence (AI) and cognitive procurement as readily as they would accept other technologies and developments. AI will bring changes and challenges but it will also bring amazing opportunities for the profession.

As we apply AI to certain procurement tasks and processes, we will begin developing internal capability and expertise.

Applying Cognitive Tech To Procurement

Cognitive technology has already proven to be particularly helpful at helping procurement with a number of specific tasks and programs. These include:

  • Quickly sorting through very large amounts of structured or unstructured data. This is especially useful for benchmarking and supplier analysis
  • Providing very detailed supplier assessments of a single supplier, a group of suppliers or the whole supply base
  • Providing in-depth risk assessments, identify hidden risks, and calculate rate risks
  • Supporting and validating decision-making during supplier selection

More generically, cognitive computing will undeniably be a key ingredient to innovation, helping to find new ways of operating, providing new insights, uncovering new opportunities and last but not least it will elevate procurement professionals to the well-deserved advisor role by extending their capabilities and growing their experience.

How Can Procurement Prepare For The Changes That Are Coming? 

The question that so many procurement organisations are asking is how can they make cognitive tech a reality and where to start?

Adopting and integrating cognitive solutions into an organization is a journey and not a destination.

Firstly, CPOs need to be clear about what matters the most. In order to grow their company’s business and best benefit from the technology, they must set realistic expectations and develop long-term plans with incremental milestones

Secondly, transformation doesn’t happen by itself. It requires the vision and support from the top. As an example, Bob Murphy, IBM’s CPO, is the biggest driver of change in terms of transforming his organization. He saw the potential in cognitive technology and the prospects for Procurement and became an evangelist within the team; encouraging, sponsoring and demanding we embrace this opportunity.

Thirdly, leveraging big data is a key area to take advantage of, especially in data management. This ensures that organisations have the right structure and strategy. At IBM, we have appointed a Procurement Data Officer and also hired data scientists within the procurement team as we understood that procurement needed to take a more active role in extracting and analyzing data to demonstrate its value especially by leveraging the data we are managing and generating. (i.e data in RFP answers, ….)

The Race Is On – Can Procurement Shape Up In Time?

With cognitive technology, procurement teams will be equipped with the tools to navigate the procurement process quickly, easily and more compliantly. This will allow more time for procurement teams to focus on strategic supplier activities after contract signature, such as performance management or supplier collaboration and innovation programs. But is the function ready for this shift?

Embedding such advanced technology requires some serious changes in skills and competencies within our teams. Procurement leaders will have to search for procurement professionals not only focusing on their core competencies, such as category expertise, negotiation skills or market knowledge, but it will be more and more important to hire people with the “right” soft skills. The function must onboard and retain people with excellent relationship management and analytical skills and with a high aptitude to work with advanced technology and financial acumen.

The procurement landscape will have to reshape to a more business leading capability that has to operate in a much more virtual and networked environment where emerging roles of data scientists, business relationship managers and innovation scouts, to mention a few, will be increasingly required.

In short, beyond just being capable of creating visible savings, the role of the procurement organisation will have to shift its focus beyond cost reduction efforts, and move towards a trusted advisor role; accurate, fast and efficient.

There’s no doubt about it, late adopters of the digital transformation or organisations failing to take into consideration the growing exigencies such as speed, value for money, collaboration will be soon perceived as road blockers rather than enablers.

Join Procurious’ free webinar, hosted by Tania Seary with Manoj Saxena, Pascal d’Arc and Nathalie Fekete to make sure you’re ahead of the cognitive technology game. 

 

 

The Coming Backlash Against Artificial Intelligence and How to Handle It

How can organisations use AI’s potential to augment, not abolish jobs?

This article first appeared on Manoj Saxena’s LinkedIn profile. 

Artificial Intelligence (AI) is rapidly moving from a mesmeric technology to a powerful teammate and a foundation for enterprise and consumer decision making.

However, AI is a young field full of amazing potential. It’s mystery and lack of understanding is also allowing for hype to grow unchecked. Unrealistic claims by advertising agencies of large technology companies of an “AI nirvana” and portrayals by Hollywood movie producers of an “AI apocalypse” are creating a hype machine that is unparalleled in recent history. The reality is somewhere in between these two extreme scenarios.

Every transformative tool that people have created – from the steam engine to the microprocessor – augment human capabilities and enable people to dream bigger and do more. It also creates massive job dislocation and AI will be no different. Except this time around it will impact not just the blue collar jobs but also white collar jobs such as this Japanese Insurance company replacing insurance workers with AI. 

Lost within all of this hype and fear is perhaps the greatest benefit I see as an entrepreneur, a senior technology company executive, and an investor – the potential for AI to do good for business and for society.

Done right, AI has a massive potential to make our business and our society much more efficient in terms of how we use our scarce natural resources and make a living. Research from Accenture estimates that artificial intelligence could double annual economic growth rates of many developed countries by 2035, transforming work, and foster a new relationship between humans and machines.

Machine intelligence, which is a sub-set of AI, will power and create efficient, real-time adaptive businesses. A “Cognitive Business” that makes sense of all available data and rapidly transforms how it engages it customers at the edge and deploys self-learning, self-assuring business processes at the core.

It will greatly help businesses that are drowning today in Big Data analytics and machine learning science projects but are starving for actionable insights and agility. Despite significant investments in customer big data, business intelligence, machine learning, and cognitive computing, these businesses are struggling with three problems:

  1. Too much data and too little insight
  2. Poor linkage between insights discovery and business action
  3. Scarce learnings from actions taken

Going forward these businesses will deploy AI powered cognitive cloud platforms to augment every user experience and business process. These Augmented Intelligence platforms will pair humans and machines so they can achieve something new and exponentially valuable together: intelligent user engagement and business processes that get smarter and more useful with time.

By emulating human cognitive abilities in software such as memory and sequencing, perception, anticipation, problem solving, and decision making, Augmented Intelligence Platforms will help make sense from messy, disparate first and third party data. They will then use the hidden meaning within all data to engage a human being by providing the right advice, at the right time, with the right evidence across any contact point.

These new class of technologies will create a new range of “new collar jobs” to design, model, build, test and manage these systems – much like the Internet and the world wide web created a new class of jobs in the late 1990s.

Keen to learn more about cognitive technology and the impact it will have on procurement? Join our FREE Webinar, Man & Machine, on the 8th February. 

Keen on the Internet of Things? Beware of IoT Botnet Zombie Attacks!

Everyone’s talking about the Internet of Things and all of the exciting things it can do for us! But just how much have we considered the possible security risks? 

What’s All the IoT Fuss About?

CPOs are becoming ever keener on enhancing hyper-connectivity within their organisations using the Internet of Things. This is unsurprising given the potential opportunities for procurement teams; warehouses that can tell you what parts you’re running out of and reorder them for you, more efficient processes and the chance to revolutionise how they manage supply chains.

Of course, it’s not just businesses that will benefit from IoT. Early adopters are already using IoT in their homes with smart fridges, smart toasters and smart collars for their pets. Experts predict that by 2020, more than half of new organisations will run on IoT.

Given all of these benefits, you might well ask what’s not to love? Well, judging by recent events, it might be prudent for us all to exercise a little more caution as far as IoT is concerned. As it stands, the process is wide open to cyberattacks.

Botnet Zombie Attacks

Individual devices pose almost no threat to any computer or data centre but what happens if millions of them were taken over at once? IoT devices are likely to have weaker security (research suggests that default usernames and passwords for devices are rarely changed), which makes them an easy target. Hackers will pre-program their malware with the most commonly used default passwords in order to hack multiple devices.

Back in October, an IoT botnet, Mirai, attacked a number of the internet’s websites including Spotify, Netflix and PayPal. The botnet works by consistently searching for accessible IoT devices protected by default passwords. Once these have been identified, the malware turns them into remotely controlled bots and is able to use them for large-scale network attacks – think robot zombie army!

This week, computer security journalist Brian Krebs posted an article on his blog, Krebs on Security, revealing the identity of Mirai author to be Paras Jha, owner of a DDoS mitigation service company ProTraf Solutions and a student of Rutgers University. Whilst Mirai has only been used mischievously so far, to shut down certain sites, the actions have brought to question what damage could be inflicted by real cybercriminals.

The Worst Case Scenario

Whilst the Mirai October attacks were relatively harmless and only resulted in some websites crashing, some tech commentators are regarding it as a test-run. It’s concerning that the next botnet attack could be aimed at data theft or physical asset disruption.

As Krebs stated in his blog “These weapons can be wielded by anyone – with any motivation – who’s willing to expend a modicum of time and effort to learn the basic principles of its operation.” Someone with a grievance against a particular website could easily have it taken offline or simply employ a hacker to do it for them.

It’s especially concerning to imagine the consequences of IoT devices being hacked within critical or high security areas such as hospitals, banking, government, transport etc. Time will tell if we are able to secure IoT before we are subject to further, and perhaps more significant, botnet attacks.

What Can Be Done?

How can individuals and organisations improve their IoT security and prevent cyber attacks? We’ve put together a quick checklist to help you strengthen your security.

  • Use strong login passwords for all your devices and strong Wi-Fi passwords. A strong password contains upper and lower case letters, numbers and symbols.
  • Make sure all the software you use is fully updates – this can fix security flaws.
  • Don’t open mysterious email links or attachments – if you weren’t expecting it, don’t open it!
  • Never reveal card information.
  • Don’t trust anyone who calls you to discuss your computer or devices – hang up the phone.

What do you think about the IoT security risks? Should CPOs halt their investments and wait for the cybersecurity to catch up with the technology? Let us know in the comments below.

Here’s what else has been going on in the world of procurement this week…

Trump Kills TPP

  • President Trump upended America’s bipartisan trade policy on Monday as he formally abandoned the ambitious, 12-nation Trans-Pacific Partnership.
  • In doing so, he demonstrated that he would not follow old rules, effectively discarding longstanding Republican orthodoxy that expanding global trade was good for the world and America.
  • Although the Trans-Pacific Partnership had not been approved by Congress, Mr. Trump’s decision to withdraw carries broad geopolitical implications in a fast-growing region.
  • Trump said American workers would be protected against competition from low-wage countries like Vietnam and Malaysia, also parties to the deal.

Read More on New York Times

Wal-Mart Cuts 1,000 HQ Jobs

  • Wal-Mart Stores began a round of some 1,000 layoffs at its corporate headquarters, with most cuts targeting the retailer’s supply chain operations.
  • The shakeups, which have been expected, suggest that Wal-Mart is willing to undo much of the work in its existing e-commerce operations in favour of Jet’s signature pricing and fulfilment algorithms, which reward shoppers in real time with savings on items purchased and shipped together.
  • The dent in its supply chain ranks could undermine one of Wal-Mart’s core strengths: its highly efficient brick-and-mortar-based distribution system.

Read More on Retail Dive

Samsung’s Exploding Galaxy Note7 Blamed on Battery Suppliers

  • Approximately 2.5 million phones have been recalled by Samsung due to explosive defects of the Galaxy Note since September 2016.
  • Recalls happen all the time, but while the Samsung case rose to infamy due to its flammable and potentially injurious nature, the revelation that Samsung’s primary and backup suppliers independently produced a faulty phone component is equally remarkable.
  • What was a supply chain problem was resolved by an operations solution in this particular case. However, batteries will be subject to more strict quality controls to avoid future issues.
  • Previous analyses also have suggested Samsung’s rush to production — both before and after the first recall — may have also impacted the finished good’s quality.

Read More on Supply Chain Dive

Procurement Salaries On The UP In 2017

  • Procurement professionals can expect to see pay rises averaging 10% in 2017, according to a salary survey
  • However, contractors will get the biggest rises – 15% – while permanent staff can expect to get 4%
  • Sam Walters, associate director at Robert Walters, said: “Across all levels of seniority we have seen demand grow for high quality procurement professionals over the past year, with those with IT procurement experience being particularly highly sought after

Read more at Supply Management

Be Brave or Be Dead – A Futurist View of Supply Chains

There are two types of company left – brave or dead. Considering what’s coming in the next 15 years, now is definitely the time to be brave.

Increasingly, there are only two kinds of companies: brave and dead.

When world renowned speaker and author, Seth Godin, talks about the future of businesses, people listen. And when Godin warns of extinction if companies aren’t brave, then you certainly want to be in the first category.

Change is coming. Not only for procurement and supply chains, but for businesses as a whole. And businesses that choose to bury their heads in the sand on key issues aren’t going to survive long. But what are the key issues they need to be focusing on?

Respected futurist, entrepreneur, and author of global best-seller, ‘An Optimist’s Tour of the Future‘, Mark Stevenson, is one man who understands the key trends heading our way. An expert on global trends and innovation, he will be setting the scene with our opening keynote at the Big Ideas Summit 2017 in London.

A Futurist’s Perspective

We’re well aware of the technological changes coming our way in the next 10-15 years. Automation, AI, and 3D printing, amongst others, have all made headlines already given their impact on manufacturing, supply chains and business models.

Industry 4.0 has presented organisations with an immense opportunity to change the way they work. However, there are still too many companies with their heads in the sand, being left behind.

According to Stevenson, there are several technology waves coming in the next decade. With each one, industries will be disrupted, but new models and strategies will arise. Companies need to account for three key components – geo-politics; geo-economics; and geo-technology.

This isn’t an either/or situation – all three are crucial. But the companies that can take advantage of these waves will not only attract the best staff, they will seriously outperform all their rivals.

The Energy Race

One of the first waves will be in renewable energy, and a final step away from fossil fuels. Even oil-rich nations like Saudi Arabia are planning for this future, advising they will be ‘getting out of oil’ in the next 20 years. Even now, organisations are generating their own energy, or are buying energy through co-operatives. The traditionally big players in the industry will increasingly be bypassed, as energy gets cheaper and more locally generated, something that can only be a benefit for individuals and organisations.

Financial Services Disruption

What will happen to the Financial Services industry? Can it survive this disruption? Yes, but it will need to evolve to survive. Stevenson uses the example of the blockchain as a key disruptor. He is on the board of a new bank which embraces blockchain and has about 50 staff.

This is a far cry from the enormous, staff heavy traditional models, who have thousands of staff praying that blockchain is just a bad dream, hampering their ability to innovate. As the novelist Upton Sinclair noted “It’s difficult to get a man to understand something when his salary depends on him not understanding it”.

Manufacturing Revolution

An area where supply chains are already seeing major disruption is in manufacturing. Of this revolution, Stevenson highlights the potential for 3D Printing.

Organisations can bring much manufacturing in house. Designs can be downloaded and printed on site, at a fraction of the cost in some cases. One industry looking at this is pharmaceuticals – the first 3D printed drug is already FDA approved.

Unlocking the Genome

 Genetics and Bio-Technology represent a technological wave that many have yet to consider. Advancements in human longevity change the game for the medical industry, but leave organisations with decisions to make on staff. What do retirement, long-term strategy, even relationships look like if we might live healthily past 100? And, to loop back to the energy race, bio-technology is one disciipline that is already being leveraged to pull CO2 from the skyu and turn it into liquid fuel. Why shouldn’t procurement be at the heart of this revolution too?

Time to Be Brave

 Ultimately, Stevenson’s message boils down to one thing – if you don’t understand the questions technology is asking you, then you’re lost. It might seem brutal, but it’s the truth, and trying to ignore it, or pleading ignorance will mean your company may soon be obsolete.

However, the message here is not intended to be doom and gloom. Stevenson reminds us that one option is a future that we can make better for all. He’s keen to engage people on an emotional level, and get them thinking about their careers, and their children’s futures.

It’s time for leaders to engage their hearts, not just their minds. It’s time for us all to get our heads out of the sand and look up. And if we all listen carefully at the Big Ideas Summit 2017, we’ll certainly learn a great deal about our role in making the future sustainable, human, compassionate and just.

Join the conversation and register as a digital delegate for Big Ideas 2017.

Technology Is The Answer. But What’s The Question?

Companies everywhere are super-keen to invest in technology and an eye-watering $3.49 trillion will be made available in 2017 for this purpose – but how can CPOs and IT buyers ensure they make the right decisions? 

If you ask any CPO what their main priorities are for the next five years, you’re almost guaranteed to receive an answer involving technology. Spend for software and IT services is rising at a dramatic rate, and is expected to increase by an incredible 29% in 2017 to $3.49 trillion in the U.S. alone.

The urgency for harnessing cutting-edge technology is understood, and the good news is that business are making the money available. But how do you make sure you’re investing in the right tools?

Here’s the secret: you need to make sure you’re asking the right questions

Supply management professionals will gather in Washington, D.C. on March 22-24 for ISM Tech 2017, where they will gain access to the knowledge required to make intelligent technology investment decisions for the unique needs of their organisations. IT procurement experts will reveal new possibilities and cost-saving efficiencies in areas including advanced analytics, manufacturing 4.0, the role of robotics, going digital and utilising augmented reality.

Keynote speakers include Rick Smith, CEO of Fast Radius, who will be presenting on “Our 3D-printed future”, while Silicon Valley Entrepreneur and bestselling author Martin Ford will deliver a keynote titled “How data is driving the transportation revolution”. Other big names include Abtin Hamidi, Co-Founder and Executive Vice President of Cargo Chief; Amanda Prochaska, Vice President Procurement Program Management Office, MGM Resorts International; and Tom Martin, Director of Learning Solutions at ISM.

What questions will Tech 2017 help you to answer?

  • How can robotics streamline my business processes?
  • What’s the best way to use the Internet of Things (IoT) in the supply chain?
  • How can my organisation use technology innovations to capture digital customers?
  • How can I leverage analytics to align planning with demand?
  • How should I mitigate technology-related risks?
  • What capabilities will my team require to keep up with technological advancements?

As with every ISM Event, Tech 2017 is all about the networking. Attendees will have the opportunity to meet scores of innovative suppliers and exchange ideas with representatives from top providers in the field, strategizing with experts on their technology needs to identify new ways to tackle existing challenges and future growth opportunities.

This is one event where just about any conversation taking place in the Exhibition Hall is likely to make fascinating eavesdropping. Instead of the usual procurement “chatter” around traditional practices such as sourcing, contracts and requisition-to-pay, attendees will discuss cutting-edge concepts like cognitive analytics, 3D printing, digital reporting, artificial intelligence and machine learning.

As you network, keep in mind that IT procurement experts have been tipped to be the CPOs of the future. According to Procurious founder Tania Seary, the profession is now looking to this highly-skilled group for leadership, and IT experts are on the fast-track to leadership due to five key advantages:

  1. IT experts already control an important chunk of their organisations’ strategic spend.
  2. Soon everything we buy will include an element of technology.
  3. IT procurement experts know how to drive change.
  4. They are innovation scouts.
  5. They understand cyber security.

Don’t miss out – ISM Tech 2017 will take place at the Gaylord National Resort and Convention Center, Washnigton D.C. from March 22-24, 2017.

What is the Future of Knowledge Management in Procurement?

Knowledge management is becoming critical for organisations as the current generation retires. So how can procurement leverage technology to ensure knowledge isn’t lost?

tree of knowledge management

Introducing Watson Supply Chain from IBM. Get to know Watson here.

“Knowledge is power,” proclaimed Francis Bacon, the English philosopher whose advocacy of the scientific method fuelled the scientific revolution. Centuries later, Dale Carnegie, the American philosopher and writer, and perhaps the father of corporate training, responded, “Knowledge isn’t power, until it is applied.”

Bacon’s and Carnegie’s time may have passed – our economies and businesses are exponentially more global and complex – yet, their words still ring true.

Trends Influencing Talent and Knowledge Management

For a global business, managing procurement essentially means tackling the enormous challenge of managing information and knowledge. Today’s complexities emanating from globalisation, dispersed workforces, and massive amounts of data make information and knowledge oversight critical.

Further, demographic and talent management trends make the issue even more pressing:

  • Key personnel are retiring

Baby boomers, the experienced core of procurement and supply chain teams, are retiring at a record pace. Replacing their knowledge and experience is a hefty task.

  • Replacements are inexperienced

The millennials who make up the bulk of new hires, although tech-savvy, often lack procurement and supply chain experience and knowledge. They also are hard to retain – averaging less than two years in their positions.

  • Teams are expanding

Procurement teams are expanding in line with the maturation of the profession and the greater, more strategic responsibilities and objectives put on procurement organisations.

  • Teams are dispersing

Further, with globalisation and growth, procurement teams are increasingly decentralised and located globally, making it harder to pass knowledge and expertise through day-to-day personal interactions.

Amidst these trends, how do you retain, build, and share procurement and institutional knowledge not just within the organisation – but across the globe and across systems?

Technology Trends and Evolution

This is all occurring at an interesting time from a technology standpoint. Procurement has seen technologies evolve over the past 20 years from point solutions, such as spend analysis and sourcing solutions, to suites that span the entire procure-to-pay and source to-pay process as well as the larger strategic supply management process.

This really has been an evolution focused on ever-greater automation and connectivity across the global procurement organisation. Increasingly, their goal is to centralise procurement and supplier data for the sake of efficiency and to get the entire enterprise on the same page.

It’s led to tremendous advances in sustainable savings, risk mitigation, and supplier management and innovation.

Now we’re at another technological inflection point. From the procurement point of view – and talent management point of view – it’s coming at an excellent time.

That next big evolution is cognitive solutions. Or, as it’s also popularly known, artificial intelligence.

The Emergence of Thinking Technologies

Cognitive technologies are now being regularly used by forward-thinking procurement organisations at Fortune 1000 companies to tackle specific tasks, such as assessing risks or profiling suppliers.

In the months and years to come, these cognitive technologies will be weaved into procurement and supply chain enterprise solutions. Cognitive technologies go beyond information management and process automation; they are solutions that can understand, reason, learn, and interact like a human.

They can analyse data, both structured and unstructured, from internal and external sources, at enormous scale and speed. This allows for deeper analysis and insights.

Cognitive technologies are an evolution of the first order. They are more in line with the advent of enterprise software, mobile phones, or the Internet, than the progression from point solutions to suites.

IDC estimates that, by 2020, 50 per cent of all business analytics software will incorporate some cognitive computing functionality.

Additionally, the Pew Research Center notes, “By 2025, artificial intelligence will be built into the algorithmic architecture of countless functions of business and communication, increasing relevance, reducing noise, increasing efficiency and reducing risk across everything from finding information to making transactions.”

How do cognitive technologies impact talent and knowledge management?

From a knowledge management perspective, cognitive solutions enable an organisation to retain institutional and supply chain information and experience. They offer the power to elevate personnel by providing thinking solutions that inform, speed, and improve day-to-day actions and decisions.

These solutions can extend or expand the knowledge of global personnel.

With cognitive technologies, knowledge sharing becomes automated. For example, a new millennial team member – in Mumbai, Shanghai, or Austin – can access the professional knowledge of a 20-year procurement veteran. Or a procurement professional who has worked his or her entire career in Boston can tap into specialised knowledge about markets, practices, and suppliers in Brazil.

Cognitive solutions provide personnel with deep insights and experience, collected over time, drawing from sources inside and outside the organisation. These technologies learn and operate by organisational preference – developing a “supplier playbook” – and can provide actionable recommendations to personnel. Further, cognitive technologies can foster collaboration across the company and with suppliers.

In sum, cognitive technologies elevate and empower both individual employees and the entire team.

Indeed, we’re amidst a knowledge revolution – where procurement personnel proactively advise the business, offering smarter insights, deeper analysis, and greater strategic value.

If knowledge is power, organisations are risking losing power if they don’t have effective knowledge management processes. But technology, such as IBM Watson Supply Chain can help retain this knowledge and pass it to the next generation. Find out all your need to know here.

2016 Rewind – Best of eLearning – Disrupting the Status Quo

We’re counting down to the new year by looking back at some great eLearning content from 2016. Here, we learn how technology can help procurement disrupt the status quo.

disrupting status quo

“If you’re not disrupting, them you’re being disrupted.”

This was one of the key learning points we heard regarding procurement technology this year. And when it comes to technology, you always need to ask the experts. That’s exactly what we did in a webinar in early November.

We invited representatives from Oracle and Enrich to Procurious HQ to talk about the way procurement can leverage technology in key areas.

Status Quo No More

The current pace of change around the world is unprecedented. Procurement and the wider organisation are quickly recognising that maintaining the status quo will not suffice in staying ahead of the pack.

This is only a small sample of the webinar, but you can download the rest here.

While many organisations talk the talk about technology, few actually walk the walk. And for many, the status quo is still how they go about their business. But as times change, organisations are recognising that they need to as well.

During the course of the webinar, we heard:

  • Why the challenge for business is to be able to adapt and apply new solutions for innovation and competitive advantage;
  • Why many organisations are still grappling with getting data into a structured and accurate form that they can use for predictive analytics;
  • That people tend to underestimate the complexity of stitching together the myriad vendor solutions as they aim for a more B2C-type interface; and
  • That change management is vital in technology implementation, or people will revert to old habits.

So make sure that your technology implementations in 2017 go smoothly by learning the lessons of the past. If you want next year to be the one where your procurement team leaps forward, you’ll need to ensure your technology is working for you, not against you.

You can read more about how technology can help boost procurement on the Procurious Blog. You can also catch up with other thought leadership from our community on the eLearning Hub. And there’s a whole lot more there to keep you interested too! Happy viewing!