News U Can Use

A Supply Chain/Strategic Sourcing learning community devoted to ideas you can use in your work or daily life.

Archive for the ‘News U can Use’ Category

This is where we will take current events and try and generate some provocative discussion and see what we can learn from the news and from each other.

Troops in Afghanistan – a Dramatic Case Study for AEIOU

Posted by thempowergroup on October 21, 2010

Today’s post is from Anne Kohler, COO & Executive Vice-President, of The Mpower Group (TMG) and a contributor to the News U Can Use TMG blog.

What do these historic events have in common?

  • U.S. Invasion on North Korea
  • The Bay of Pigs
  • Watergate
  • Escalation of the Viet Nam War
  • The Hostage Rescue in Iran
  • The Challenger Disaster
  • The Bush Administration’s Invasion of Iraq

This list represents some of the biggest decision-making disasters in history.

A few weeks ago, the famous Washington Post White House author, Bob Woodward wrote an article entitled “Military thwarted president seeking choice in Afghanistan” which was all about the critical nature of decision-making.  What greater decision can there be than deciding the fate of tens of thousands of young U.S. men and women as they are sent into war-torn Afghanistan?   The article chronicles the process that President Barrack Obama undertook in finally deciding to send 30,000 additional troops as opposed to the 40,000 (which came highly recommended by his military leaders) in December 2009.

Obama discovered after months of negotiating with national security officials and being in the middle of a war entering its ninth year that three simple questions could still NOT be answered:

  • What is the mission?
  • What are we trying to do?
  • What will work?

In other words, what is the intended consequence in Afghanistan? . . . . . . . . . . . . . . . .

As it turned out, Obama’s military leaders wanted to provide a solution (40,000 new troops) without defining a strategy – the answers to those three simple questions (obviously not so simple!).  Obama asked for a strategy (the answers to those questions) and asked for options, but the inability to answer those questions kept leading back to NO viable options except for an option that was UNacceptable to Obama.    

Having been well versed in decision-making disasters from the past (see above), Obama chose to follow a more structured decision-making process.  He knew he had many intelligent key stakeholders at his disposal and wanted input, alignment, and buy-in from all of them.  He actually made a meta-decision – he decided how to decide by answering the following:

  • Who needed to be included in the decision-making process (stakeholders)?
  • What role would each stakeholder play in the decision-making process?
  • How would the decision be made – what criteria would they use to decide?
  • When did the decision need to be made?

Obama did a thorough stakeholder analysis to determine who needed to be included in the decision-making process.  He realized that it was critical to include both military and civilian leaders.  He also determined each stakeholder’s role in the process; keeping the final decision for himself.  He then determined the decision criteria and insisted on being provided options by his advisors, which was critical.  Finally, he did not allow himself to be rushed into making a quick decision (his military leaders tried to do just that) which allowed him the opportunity to consider many alternatives.

 At the end, he “sold” his decision to all his stakeholders and insisted that they put their full support behind it.  Obama said, “I don’t want to have anybody going out the day after [the speech] and saying that they don’t agree with this.”   

Time will tell whether or not this was the right decision for the U.S.  BUT what we can glean from this article is the importance of having a disciplined approach to decision making.  Even if all of Obama’s stakeholders did not necessarily agree with the final decision, it appears that they did respect the process.  Right before the decision was announced Obama gave Robert Gates, his Defense Secretary, a final opportunity to dissuade him saying, “Can you support this?  Because if the answer is no, I understand it and I’ll be happy to authorize another 10,000 troops, and we can continue to go as we are and train the Afghan national force and just hope for the best.”  Gates did not take Obama up on his offer.

This is just one example of the importance of decision-making.  This is the one skill that most leaders are never trained in, even though it is the most critical part of their job.  It is one of the elements of our AEIOU model, which stresses that the best infrastructure (people, process, tools, and technology – the consonants) in the world is useless without the glue that holds it together (Adoption, Execution, Implementation, Optimization, and Utilization – the vowels that turn the consonants into a language). 

Some of the most important events in history required effective decision making and yet we spend little to no time on developing the skills necessary to make good decisions.  The recent deaths in the California wildfires have been attributed to poor decision making by the firefighters.  The good news is that this has led to the addition of decision-making to firefighter training.  One of the most critical decisions that affects all of us is that of a jury.  Yet numerous articles have been written about the fact that our present system does nothing to provide jurors with the tools to decide the fate of a human life.

We need to think about this key skill beyond our politicians and public servants.  How about executives of any kind?  Supply chain leaders?  Sourcing teams?  This should be a critical leadership skill that is purposely taught to all professionals – let’s provide the vowels to complete the language!

Thanks Anne!

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Strategic Sourcing Is Ready For A Revolution!

Posted by lowellyarusso on October 7, 2010

Today’s post is from Dr. Lowell Yarusso, Senior Vice-President, Talent Management, of The Mpower Group (TMG) and a contributor to the News U Can Use TMG blog.

In my last blog, I raised the possibility that the “Curse of Knowledge” has significantly influenced the inability of Strategic Sourcing to deliver on its promise to drive Exceptional Business Results.  In that blog, I indicated that there are several steps that should be taken to address that failure.  One of the steps I offered was a reevaluation of the underlying theory that drives Strategic Sourcing.  That is the topic I want to begin to consider here.

The current debate over the life or death of Strategic Sourcing calls to mind the work of Thomas Kuhn who wrote The Structure of Scientific Revolutions in 1962.  His main point was that science does not march forward in linear progress towards ever-increasing knowledge.  Rather, it jumps as the result of revolutions in the paradigm that informs scientific inquiry.  Between revolutions, the periods Kuhn termed “normal science”, the major activity is applying the currently accepted paradigm to address the problems that are most readily solved using the current paradigm.

How this comes about is fairly predictable.  There is an issue, a question, a class of problems that are not well handled by the current paradigm.  During the period of normal science, those issues, questions and problems are less important or considered too difficult to resolve.  Eventually, however, the scientific community is faced with a crisis because of the unresolved tension between the theory and the practice of the science.  In response, a revolution (a new paradigm) is launched.  The scientific community responds in a predictable way.  Most ignore the challenge.  Some respond with vehement defenses of the existing order.  A few wonder if the challenge is viable.  After a good deal of thrashing around, the new paradigm, if it proves to be useful in addressing the tension, the new paradigm is accepted and the scientific community settles back into another period of normal science based on a new theory about the way things are.

How does Kuhn’s work apply to Strategic Sourcing?  Reviewing the debate in a variety of blog sites indicates that the reactions to Dalip Raheja challenge (click here and here for details) of the “Strategic Sourcing Community” is quite similar to the “Community of Science” that Kuhn was attempting to explain.  Briefly, for the past 25 years or so, Strategic Sourcing has been guided by a shared paradigm, the “Sourcing Process”.  During that time, the members of that community have been largely involved with what can best be thought of as “normal sourcing”, i.e., the effort to apply the process to the types of problems that it is expected to address.  Now, the community is responding to Raheja’s call for a new paradigm as Kuhn would expect any group that is guided by a shared world view would respond if that world view is challenged.

To make the point clear, virtually every Strategic Sourcing practitioner understands that, regardless of the way they have defined the process for themselves, the process they propose is derived from a common source, the A.T. Kearney sourcing process.  Whether they have recognized it or not, that process implies a certain paradigm, or theory, about the business world.  Following Kuhn’s thinking, that means that their focus has been on improving the application of the theory, not on demonstrating the validity of the theory itself.  What has that meant?

For most of the past 25 years, a great deal of effort has been expended demonstrating the results obtained from the application of the theory, that is, the Strategic Sourcing Process, in a wide range of venues.  That is the activity of “normal science” and, in this analogy, would be the natural focus of “normal sourcing”.  As a result, we have a great deal of evidence that specific applications yield demonstrable outcomes, i.e., specific ranges of cost savings.  Whether the original theory underlying Kearney’s ground-breaking process did or did not focus on cost is immaterial.  The problem that sourcing was seeking to address was “excessive supply chain cost” and that problem was being successfully addressed by the process driving the sourcing community.

What was largely unnoticed, or at least unremarked upon, was that a cost focus has an inherent limit on the results that can be obtained.  No matter how far up or down the supply chain you apply the process, there is a finite limit on the cost savings that can be obtained.   Now I doubt that any practitioner or any organization would argue that they have approached that limit as a result of applying Strategic Sourcing.  What has happened is that, once organizations pick the low hanging fruit on the cost tree, they find that the return on subsequent applications of the process quickly diminish.  And that is what has led to the current crisis for Strategic Sourcing.  A second order problem has arisen and the current process has had, at best, limited success dealing with it.

Now, back to Kuhn.  In his explanation of what happens in communities of practice, this is as it should be.  While the current world view is achieving the results the community in practice is seeking, the community will continue to apply it and will seek to measure and demonstrate success in the terms defined by that world view.  It is not that the community does not want to go beyond the terms of the world view.  It is that they can’t do so until they find that there are bigger (or at least different) issues that have to be addressed.  If the existing paradigm is sufficient to encompass those issues, there will be no revolution.  If not, tension will gradually build until some individual proposes a competing paradigm that will provide a response to the crisis issue.  And, interestingly, the new paradigm is often LESS successful at addressing some of the old issues.

Kuhn would say that where we are as a community of practice is on the cusp of a new, emerging paradigm.  The theory has not been articulated as yet but the source of tension has been identified.  What is critical at this point is to return to the underlying theory that supports the Strategic Sourcing process and begin to analyze it.  Until now, it has not been necessary to do so and, in fact, Kuhn would tell us that it would be counter-productive to have done so.  So long as the “Theory in practice” allows practitioners to address the problems with which they are confronted, the theory should be unquestioned and the focus should be on improving the results.  If Raheja (and some others) are right, then it is imperative that we re-examine the theory (and not just the process) that informs our collective thinking about Strategic Sourcing (or whatever it may be called under the next paradigm.).  Only when we have evaluated the effectiveness of the theory can we successfully amend the processes, procedures, and tools.  And that is about revolution, not evolution, of a community of practice.

Please share your comments.  If Kuhn is even partially right, the key at this point is to explore the limits of our current thinking so that we can clarify the direction we need to go.

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Achieve Exceptional Business Results – Buy a Vowel(s)!!!

Posted by thempowergroup on September 9, 2010

Today’s guest post is from Anne Kohler, Executive Vice President and COO of The Mpower Group (TMG) and a contributor to the News U Can Use TMG blog.

Over the past year, as the economy has worsened and companies are being squeezed financially, we have heard the following from extremely frustrated clients and prospects (most of which are in Supply Chain or Sourcing):

  • “We have a process – no one is using it”
  • “We have spent millions on  technology and using only 20% of its capability”
  • “We have sent our people to training but they can’t  apply the knowledge”
  • “Results are not meeting expectations”
  • “Tactical demands overwhelm strategic initiatives”
  • “There is resistance outside of our group”
  • “Middle management is not on board”
  • “Every issue is an excuse to stop progress”
  • “Decision making is sloooow and gets in the way”
  • “Experiences are not captured and / or shared”

Could any of these quotes apply to your company?  If any or all of them do, you need to BUY A VOWEL(S)!

In a previous post from Dalip Raheja, “ Old MacDonald Was Right — It Is About E-I-E-I-O! “ he  wrote:

“The vowels are the most critical link between our alphabet and our language. Without vowels we don’t have words … we just have letters! Without words, we have no sentences, no language, no meaning, no intelligence — in short, we have nothing!  The vowels Dalip was referring to are  Adoption, Execution, Implementation, Optimization and Utilization.  Millions of dollars spent on people (talent, training, etc.), process (manuals, toolkits, knowledge management systems, etc.) and technology (ERP, eProcurement, eSourcing, etc.) won’t buy you business results without the vowels!!!  Now, follow Vanna White’s advice and BUY A VOWEL(S)!

In a nutshell, the vowels represent the enablers that must be in place for any new business process or technology to succeed.  Let me give you a simple example.  I purchase a new Mac computer for my family (we have always used a PC in the past), have it installed, get some basic training and then let it sit for 60 days.  When we start to use the Mac, we come across the following issues:

  • The family is upset because they do not understand why we switched to a Mac to begin with
  • We are fumbling around because the training was so long ago we forgot most of what we learned
  • We use the Mac for internet and email only and revert back to our old PC for all other applications
  • We keep making the  same mistakes over and over
  • We never learn to use the full functionality because it is just TOO Hard
  • We eventually sell the Mac to my brother and revert back to a PC

Is the problem the Mac itself, the training we received, the documentation on the Mac, our lack of technical capability or is it something else entirely?  I would suggest that it was the vowels that were the problem. Let me explain with a few illustrations:

Adoption

  • Reason for buying the Mac was not sold to the family up front –  to prevent viruses which were constantly attacking our home PC (costly)
  • Needed to create burning platform in their minds to switch (insist they share in the cost associated  with NOT switching)
  • Needed to sell “what’s in it for them” by individual (the increased functionality was significant for everyone)

Execution

  • Needed to have more targeted training – it was too basic
  • Needed to make the time to learn the new functionality (remove the barriers to change)
  • Needed to take a leadership role in driving  my family to follow through on adopting the change

Implementation

  • Needed to take full advantage of the instruction manual to help us discover hidden value
  • Needed to work with the Mac immediately after the training was delivered
  • Needed to remove the PC from the house to force adoption of the new technology

Optimization

  • Needed to provide ongoing coaching and mentoring to reluctant users
  • Needed to develop a  fun  “case study” work to encourage the use of new applications
  • Needed to share “lessons learned” between us to prevent recurring mistakes

Utilization

  • Needed to make  the discovery of hidden value a fun experience
  • Needed to use metrics to monitor and reward consistent usage
  • Needed to celebrate success

This is just a simple example from a personal perspective and you can see the number of issues that arose.  If you expand this to a business problem, the number of stakeholders increases and the  issues become exponentially more complex.  Therefore, the vowels become even more critical.

Most companies are so caught up in making sure they have the right process, people and technology(and many times they don’t do that particularly well)  they forget about what it really takes to extract the most value out of any change – the vowels!!!!  So, to be a success and achieve exceptional business results – BUY A VOWEL(S)!!!!!   

Thanks, Anne!

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