Tag Archives: procurement technology

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? 

StepanPopov/Shutterstock.com

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?

Maxx-Studio/Shutterstock.com

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.

“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!

Procurement’s Future – Growing Not Killing the Golden Geese

Rumours of procurement’s imminent demise persist. But would organisations be killing their golden geese by getting rid of the function?

The traditional 12 days of Christmas might not start until the 26th of December. But this festive season, we’ll be bringing you the 12 days of procurement Christmas in the run up to the big day. Catch up with the story so far on the Procurious Blog.

“On the sixth day of Christmas, my true love gave to me…six geese-a-laying.”

Mark Twain is reported to have once said, “The reports of my death have been greatly exaggerated.”

We like to think of the procurement function, and it’s fantastic professionals, as the golden geese of an organisation. We bring savings and value, build our influence, and increasingly drive strategy, but still find ourselves defending our position. And for some experts, the end of procurement in its current guise is still on the horizon.

But are we looking at this from the wrong angle? Nothing remains the same forever, so what are the strategies procurement can use to maintain its hard fought position?

Is the End Really Nigh?

It’s been a little over a year since PepsiCo took the decision to scrap its marketing procurement function. The move took many people by surprise, and left procurement commentators wondering if other major players would follow suit.

At the time, few people thought there would be a snowball effect for procurement. And, so far, they have been proven correct. So, let’s put the doom and gloom behind us, and focus on what procurement might look like in the future.

It would be incredibly naïve of us to think that procurement will continue to exist in its current form. However, what this does mean is that we have a fantastic opportunity to develop in line with strategy and disruption.

We’ve had differing views on what this might look like for procurement in the future. At the Big Ideas Summit this year, Anna del Mar, outlined how procurement could be integrated into the business.

This would not only help break down organisational silos, but actively encourage best practice procurement across the board. A collaborative attitude is going to help mould procurement success, and at the same time, make communicating our value much easier.

Tech & Disruption – Grow the Golden Geese

This all brings us back to a hot topic across all business right now – disruption. You might be tired of reading about it, but getting ahead of the disruptive wave is what we must aim for.

The disruptive landscape is changing, and even the famous disruptors (Airbnb, Uber, etc.) need to stay on their toes. Technology is forcing organisations to re-evaluate how they do business. But at the same time, it’s giving them the opportunity to change and make processes more efficient and effective.

Cognitive computing, such as IBM Watson, Big Data, the Cloud, AI and Blockchain. All these disruptive technologies stand to make massive impacts in procurement and supply chain. Processes can be automated, and taken over by robots. Technology will change the way we interact with suppliers, stakeholders and the public.

But even as the robots take over (not really), there will always be a role for people in procurement. Just as there will always be a role for procurement in the organisation. For procurement, it’s finding that sweet spot between cost and value that allows it to grow. For the professionals, it’s about having the key skills to allow them to grow with the change (but we’ll come to that in a few days!).

So let’s not get the procurement obituary prepared just yet. There’s plenty of time left in procurement’s hourglass if we’re doing the right thing. It’s all a matter of showing why it’s turkeys, and not geese, on the chopping block for next year! 

Is procurement taking heed of its impact on the wider community? We certainly don’t want to feel like we’re swimming against a tide of public opinion. Find out what we mean tomorrow.  

Buying Tech – Your Fast-Track Ticket to the Top!

I’d like to make a correction. Tech buyers aren’t just our next CPOs, they’re our next Board members.

No, I haven’t misspelt “BioTech” in the headline here – I genuinely mean buying technology.

I wrote last week on Procurious that IT procurement professionals are best-positioned to become the next generation of CPOs (Chief Procurement Officers) or CIOs (Chief Information Officers).

But then, I decided to upgrade this career trajectory to Board level.

Why? Because I’d heard first-hand how some of the world’s largest industrial companies are turning their businesses on their heads. They are changing their focus so it’s less on manufactured goods, but services they can provide to complement those goods.

Banking on Future Tech

At last week’s ProcureCon IT conference in Amsterdam, banks, car companies, engine makers and other industries all made their way to the stage to tell a similar story. You see, they’ve all finally come around to Michael Porter’s way of thinking. It’s all about delighting and owning the customer – or, more specifically, the customer data.

Even the most traditional sectors represented at the conference made it clear that they are banking their futures on technology. Of course they’ll still offer their core products, such as making cars or managing money.

However, their key competitive advantage will be in the customer experience they create through understanding their customers’ needs and habits. The data they capture when customers use their products and services is essential for this understanding.

So – to be successful into the future, these bricks-and-mortar businesses are going to have start adding some very different (and expensive) topics to their Board meeting agendas.

Decisions might include:

  • whether to store all their precious customer data in the cloud or in data centres,
  • how to protect their IP and their customers’ privacy from hackers,
  • how to comply with privacy legislation, and
  • which technology vendors to tie their futures to (or not!).

These issues have existed in business for a long time, but they now come with such significant expenditure and risk profiles that they will warrant serious Board contemplation and approval.

But who on the Board will have the experience and knowledge to provide useful and constructive insights for making these critical business decisions?

Become a Savvy Tech Buyer

Enter stage left – the technology procurement leader.

I’ve been reading and writing about seismic shifts in the world of Industry 4.0, but today the penny finally dropped. I now realise what a huge opportunity the next Industrial Revolution is for procurement.

It is indeed a brave new world. To my delight it has become very clear to me that the fastest career ticket you can buy yourself to the c-suite, is to become a commercially savvy technology buyer.

Whether you are in IT procurement or not, you should be focussing on developing these four key skills to secure your ticket to the top:

Big Data Analytics

There is going to be a lot of customer data collected over the coming years. The companies that can extract the best insights from that data, and adapt their products and services to meet customer needs, will secure their competitive advantage.

Executives with a proven track record in complex analytics will be a valuable addition to the c-suite.

Data Security

Cyber security is already one of the most concerning issues for CEOs. This will only be amplified in the future as more and more proprietary information is created.

The executive team will need leaders who know about global privacy laws, the pros and cons of the cloud versus traditional data centres, and how to outsmart the latest human or robotic hacking capability.

The Digital Landscape

Companies are already in dire need of directors and executives who understand the difference between the Ethernet and the Internet. (Hint: it’s like comparing a glass of water with the ocean).

A whole new universe of technology options are forming as the Internet of Things and Industry 4.0 explode. Boards desperately need digitally native, tech-savvy executives who can quickly analyse opportunities, understand the competitive landscape and engage first-mover start-ups in a commercially astute manner.

Busting the Big Guys

This isn’t a typical competency that you would normally see listed on a corporate job description. But from what I’ve heard over the past two days, every company is going to need a group of strong, strategic commercial leaders who can ensure the organisation doesn’t become captive to one of the big technology suppliers.

Without naming names, there are a handful of global players who dominate the infrastructure, hardware and software space.

Whilst IT procurement professionals genuinely want to engage the niche players, requirements around scale, scope and compliance inevitably lead to the large technology providers. These are somewhat symbiotic relationships, but (as we all know) there are huge inherent risks to any monopoly supply situation.

Gain Experience and Grow

So, if you’re ambitious, my career advice to you today is this:

Do all you can to get yourself into a role where you’ll learn these sought-after skills. A role in tech procurement would be perfect; procurement second-best (because every procurement professional learns essential commercial and negotiation skills).

If you’re not in procurement at all, the IT profession is another place where you’ll be able to gain the experience required to tick some of these boxes when it comes time to be interviewed for the c-suite – or hopefully, the Board!

See you at the top!

Procurious is the world’s first online network dedicated to procurement and supply chain professionals.

Register for free today! Join over 19,000 fellow professionals from around the world to share your knowledge, get your burning questions answered and help drive the evolution of the procurement profession.

Is Your Technology Serving Up Greater Procurement Performance?

To what extent is your organisation using technology to improve the performance of procurement?

Wisiel/Shutterstock.com

Procurement’s adoption of technology has been surging in recent years, and it’s showing no signs of slowing down.

But what is the best way to transform the processes and performance of your Procurement organisation, while facing up to the need to restrict budgets and generally tighten up on spending?

Next week, Procurement professionals from all over Europe will gather in Amsterdam at ProcureCon IT Europe to discuss exactly that, as well as a host of other transformational topics.

In advance of the event, we asked 100 IT Procurement executives from some of the world’s largest organisations what they are doing to drive performance using technology. Here’s a preview of the results.

Procurement on Cloud 9

ProcureCon IT technology improvement

Technology is serving up Procurement teams with a wealth of tools with which to enhance their ability to add value to their business.  From social media to the cloud, automation and the Internet of Things, the list is growing ever longer.

Our research identified the cloud as one of the biggest areas of adoption today. Almost half of surveyed procurement organisations are already heavily invested, and a further 30 per cent are currently experimenting.

However, Procurement organisations will have to learn on their feet to get the most out of this new technology. Poorly implemented systems can end up being little more than expensive white elephants.

In addition, procurement professionals need to evaluate how to best implement transformational systems and processes, while reducing costs. One solution is to avoid hiring permanent new staff with the requisite skills, but instead to find strategic external technology partners who can manage the supply chain cloud on their behalf.

Adapting to these kinds of tectonic shifts in the procurement landscape is done best by the nimble. And to the victor will go the spoils.

The Future’s Bright, The Future’s Digital

Cloud technology is just one element of the digital transformation of procurement. Another important area of investment and focus for procurement teams is harnessing the power of big data.

More than 35 per cent of respondents to our survey are already heavily invested in big data, and more than half are currently experimenting. Going hand-in-hand with big data is spend analytics, another huge investment area for procurement organisations according to our research.

However, big data means different things to different people. Procurement’s approach needs to be moderated by a focus on desired outcomes.

Without a set of clear objectives, the insights offered by analytics will be limited and difficult to put into action. Once you have decided your goal, you’ll be better placed to select the ranges of data which are most appropriate.

Join Us at ProcureCon IT

ProcureCon IT is all about finding practical solutions to the challenges which IT procurement pros face on a daily basis. It’s the only truly peer-led conference of its kind in Europe.

Not only will you meet hundreds of people who are successfully taking their IT procurement technology strategy to the next level, but it’s also a superb opportunity to meet with some of the most innovative solution providers in the market place today.

To get industry-leading insight on the issues mentioned here, as well as lots more, join us on the 5th and 6th of December at the Mövenpick Hotel Amsterdam for ProcureCon IT.

Take a look at the full event agenda and download the research on procurement technology here.

Does Insurance Against Failure Really Keep You Covered?

Is it really worth taking out insurance against system failure? Is the true value in a system that works first time, all the time?

Download ‘Parting the Clouds‘, Smart by GEP’s latest whitepaper, to understand the difference between Cloud Solutions and SaaS Software.

There was a debate in the office that ran for a while when we were putting together the white paper that’s associated with this post.

“Yes,” said one camp, “we understand that there are technical, operational and architectural differences between Cloud and SaaS, but so what?”

In other words, why should Procurement care how their software “solution” is delivered to them, as long as it works?

“Fair point” said the others, “but if we believe the cloud model is inherently more secure, robust and future-proofed than the other, should we not call out that distinction?”

“Again,” came the response “if a SaaS implementation is backed by the necessary service level agreements from the supplier, what’s the difference?”

And that is when the subject of insuring space launches came up.

Bear with me.

Can Insurance Really Cover Everything?

Insurance is what we’re talking about, of course. Ensuring your Procurement operation can carry out the business at hand without interruption or disruption is a primary goal of selecting the right software system. The SLAs in the contract with the vendor are what comprise that insurance policy.

As is the case with everything in the insurance world, the greater the degree of protection you want, the higher the premiums.  But there is also a matter of the risk.

Seven per cent of satellites and spacecraft fail at launch. Recently some fairly dramatic launch failures have made the news. The ones that really make the headlines are those that involve the destruction of a payload that teams of scientists have been working on for years.

You can almost feel the despair and horror of watching a decade’s hard work destroyed in mere seconds.

Usually, but not always, these payloads are insured against multiple possible eventualities. Launch failure, failure on deployment, failure on landing – as in the case of the recent ESA Mars mission. Naturally the premiums are immense to insure an interplanetary mission. Often the insurance by no means covers the ultimate cost of the failure.

The many millions paid out after a launch failure may cover some of the financial stake invested by the agencies funding the project. However, there is essentially nothing that can recover the loss of the science that was to be delivered. The physical and material can be replaced, but the loss of the results is absolute.

Don’t Insure Against Failure – Do It Right First Time!

A far better form of insurance for space launches is a system that doesn’t go wrong. This is in fact the calculated risk taken in many projects. Catastrophic failure cannot be mitigated with cash, so better to spend the insurance premiums on building something that won’t explode.

And this is why it seemed an appropriate metaphor for the kind of SLA insurance under discussion. It’s all very well having the on-paper insurance for failure coverage, but that’s of little consequence if the financial value of the pay-out can do nothing to mitigate the real cost.

This is why, then, we feel there is a clear distinction between different interpretations of what “cloud” actually means. The fundamental underlying scalability, security, robustness and other forms of risk really should be considered when making a genuinely informed decision.

Comparing vendor contracts like for like you may see the same SLAs – system availability, uptime and access. But without a doubt the benefit of an SLA is in never having to rely on it.

If your procurement technology fails, are you really covered against all the potential losses? What risks should you be considering when adopting new Cloud technology?

Download Smart by GEP‘s latest whitepaper, ‘Parting the Clouds to find out all you need to know.

How 9 Technologies Will Drive Global Supply Chain Disruption

Cloud corporations, supertrends, and potentially procurement without lawyers and auditors. Are you keeping up with technologies driving global disruption?

Last week, Procurious attended the ProcureCon Europe conference in Berlin. You can read about our experiences, keynote highlights, and more on our Blog.

One keynote caught our attention enough that we felt it needed delved into in more detail. Professor Leslie Wilcocks, Professor of Technology Work and Globalisation at LSE, spoke about how procurement needed to prepare itself for digital disruption.

If you are a regular reader of the Procurious Blog, then you will be aware that we have a keen interest in future technologies. From drones and last mile logistics, to blockchain, we’re aiming to keep up to date with the impact on global supply chains.

So with this in mind, we revisit what was a fascinating keynote.

Prepare for Disruption!

Professor Wilcocks kicked off with the following statement: “Technology will disrupt pretty much everything between now and 2025.” This isn’t just the world of business, though that will see a massive change. But it’s also everything we do, see, touch, and encounter in our daily lives.

According to the GEP Procurement Outlook 2016, there are 5 so-called “supertrends” we need to be on the look out for. These are:

  1. Heightened impact of geo-politics
  2. Shift of economic power to the USA and emerging economies
  3. Continued decline in global commodity prices
  4. Increased impact of climate change
  5. Push to Digital

It’s safe to say that all five have been highly visible during this year. We’ll be keeping an eye out for 2017’s “supertrends” with great interest!

However, it’s the fifth trend that Professor Wilcocks focused most on. He believes that much of the interconnectedness and innovation being seen in procurement comes from the application of technology.

As we have frequently stated, procurement cannot afford to ignore technology. If it does, it cannot deliver true value to organisations, and faces redundancy, or obsolescence, in a fast-changing world.

Rise of “The Cloud Corporation”

Happily, the assembled procurement professionals were given a list of technologies to watch over the next 4-5 years. These fell into an easy to remember acronym, SMAC/BRAID.

  • Social Media
  • Mobile Technology
  • Analytics (Big Data)
  • Cloud Service
  • Blockchain
  • Robotics
  • Automation
  • Internet of Things
  • Digitisation or Digital Fabrication

These technologies all link together to help the emergence of digital businesses. Or as Professor Wilcocks put it, “The Cloud Corporation.” They also provide a number of opportunities and challenges for businesses. They need to be more agile, and manage on a ‘micromultinational‘ level, but it also opens up the potential for major process innovation.

However, Wilcocks did give one caveat on technology and innovation. No-one knows how to fully maximise the potential of technology. The only way to do this is by learning by making mistakes, something less agile organisations have proven themselves to be less good at in the past.

Transforming the Supply Chain

So how does all this fit together with disruption to the global supply chain? For the most part, the disruption has already started, and, as a result, organisations are playing catch up. However there are some tactics that can be used.

  • Organisational – realigning organisations strategy for supply chains on a functional, geographical or regional level.
  • Technological – ensuring supply chains are integrated to work best through better connectivity.
  • People – traditional pyramid structures aren’t optimised for the digital era. Human talent in the digital supply chain should be organised as a diamond, providing a more streamlined hierarchy, and better training opportunities at the lowest levels.

Switching the focus to the benefits of automation showed how the technologies could impact productivity. Traditionally, organisations have used five methods to transform their supply chains:

  1. Centralise
  2. Standardise
  3. Optimise
  4. Relocate to Low Cost Region
  5. Technology Enablement

However, there is a sixth that can, and is already, increasing productivity in supply chains – automation. It’s estimated that by automating, an extra 3-4 per cent can be added, on top of the efficiencies found in the other measures, by automating processes.

Final Word on Blockchain

There was one final word on blockchain before the end of the keynote. The disruption being caused by blockchain is, in itself, a protector for organisations from being disrupted. And organisations can leverage the technology to aid transparency, governance, and authentication.

Blockchain can also help with the evolution of “smart contracts”. These contracts can have rules set for automatically storing data, and executing commands.

Could it help to disrupt the disruptors? Probably, yes. Operating the technology at its most effective level could remove the need for banks, lawyers, credit cards, and even auditors, in the procurement process.

Whatever the challenges that exist, surely that’s something to aim for. Isn’t it?