Trump's Twitter procurement strategy?

Donald Trump has redefined how to use Twitter. Still President Elect, as opposed to President, he appears to have adopted a 'shoot from the hip' approach to policy and announcements. In the UK politicians were criticised from making announcements on TV as opposed to Parliament, but this is of a different order.

One of the stories which dominats the US news today is President Elect, Donald Trump's 'Cancel the order' Tweet.  The order being with Chicago-based Boeing for a new version of Air Force One.  The Tweet is effectively saying "I am going to block this contract as I believe it is no longer a good deal". Now, that will send tidal waves through contractors and those in procurement in US public procurement! What will become the new modus operandi?

Needless to say Trump's estimate of the $4bn is challenged by many. Boeing, it appears, haven't even secured the deal!  Then you've got the reality that the plane is unlikely to be delivered during Trump's residence of the Whitehouse anyway - it will be other Presidents' plane as opposed to his. Transition is taking on a new completion now and for his successor.

Anyway, is Trump ushering in a new style of Twitter usage, a new style of public procurement negotiations, or a new style of procurement strategy?  If other political and business leaders chose to follow his style this will create a very real and present danger for procurement professionals. Trump has built a reputation of saying "You're fired" what's that mean for procurement?

A case of digital procurement sustaining and saving

It's not often I bring a good news story; maybe the sun has improved my outlook. Regardless, I am thankful to tweet of @360supplierview which drew my attention to a report in yesterday's Yorkshire Post.

Asda have provided a great example of how digital technology can be effectively harnessed by procurement to reduce costs and improve sustainability. Asda's Sustain and Save Exchange is a collaborative platform for suppliers - to me it looks like a community of practice. It aims to share information, knowledge and learning, raise questions, post key documents, attend focused activities, spur new ideas and solve problems.

Set up in February 2012 there are claims of £13m of savings in sustainable innovations. 300 suppliers have joined so far, including, bakery, fish, poultry, chilled, frozen, and ethnic foods.

Collaborative knowledge sharing and problem solving of this type would have been inconceivable a few years ago but this is surely only scratching the surface. Why have so few organisations seized the opportunity?

Ironically, while the retail sector is starting to recognise the potential of social collaboration, the future of LGA's Khub hangs in the balance. The LGA, sadly, has never really been able to drive the original vision and drive of Steve Dale even though he delivered global collaboration. It was a personal sadness to me as I was, at one time, leading the Efficiency and Productivity Exchange which was providing evidence of benefits clearly before the retail sector tipped its toe in the water.

Procurement Needs a Digital Strategy: White Paper

Some weeks ago, through a few posts, I discussed the need for procurement to embrace digital strategy. Those core ideas have now been drawn together into a whitepaper which can now been downloaded:  Procurement Needs a Digital Strategy: White Papers: Resources: TCS.

I hope you find the whitepaper of interest and I'd be delighted to receive any comments.

Snake oil procurement

Tonight the so called 'Devils Advocate starts a 14 year jail sentence. His sentence is poetic justice for a lawyer with no legal qualifications not registered to practice,  yet gained notoriety and £1m from representing those who could never win within a justice system. Isn't there something quite remarkable about this modern day snake oil salesman who received good money on a 'no expectation of win basis'. Added to his real CV are now fraud, deception, money laundering and forgery. Would you buy advice from such a person?

Of course we have already discussed fake lawyers, this is not a one-off, and ironically we have even come across a coroner who turned out to be unqualified to practice.

Although it was before I stared this blog, there was also a wonderful example of an unqualified surgeon. You are also no doubt familiar with the great fraudster, Frank Abagnale Jnr, portrayed in 'Catch me if you can', who now works for the FBI. and perhaps that other compulsive fraudster Steven Jay Russell made famous in 'I love you Phillip Morris'.

Interestingly, it can also be implied from this week's evidence to the Public Administration Select Committee, that those leading procurement reform in the UK have no way of knowing who in central government procurement is actually a 'fraudster' unqualified to practice!

But today's message is simple, how can you meet the challenge and avoid the risk of being gullible enough to be taken in by a procurement snake oil consultant selling aspirations which cannot be delivered and is more qualified in non-delivery than the profession?  This is all the more relevant given that many of those who make such appointments just wouldn't recognise 'the real thing' and are buying the promise.

A risk in outsourcing: (Not) Embracing Digital Procurement Strategy

I have been discussing Digital Procurement Strategy over the last few weeks. I thought I had said as much as I was going to until I read Thursday's report in The Guardian on the gagging orders allegedly placed on probation staff during the current outsourcing process of 70% of the work. This provides lessons for all those involved in outsourcing and change management.

As I see it, some stakeholders affected by the outsourcing decision aren't happy - should that be a surprise when your job is at risk, particularly in the current economic climate. They have not been won over during the change management process. They assumed they had freedom of speech and social media provided the channel. The main champion of the proposed outsourcing (the Justice Secretary) doesn't like what is being said using social media, so has chosen to effectively issue a gagging order on any dissenting voices. The gagging order isn't restricted to the disgruntled workers criticism but also applies to their 'retweeting' of others views (potentially this blog too). Seems like a strange view of justice but then perception counts for a lot. There also seems to be more than a little contradiction between the MoJ's view of the world and the proposed NHS Duty of Candour!

Of course we also need to remember that there are more stakeholders than the staff - there are the other potential providers (as I discussed in Probation's Dilemma a few weeks ago).

We are currently in the outsourcing process, what will happen when the contracts are subsequently awarded - will social media turn the process into another West Coast Rail debacle, will contract management become a target of social media, etc...?

My suggestion is that:

1. Recognise social media is two way - you may see it as part of external communications but it is also market communication about and to you;
2. Digital Procurement Strategy needs to reflect the risks of stakeholder engagement, misalignment and criticism;
3. Any potential discussion, yes, even a discussion, on outsourcing needs to be viewed within the context of a change management programme, even if it may not lead to outsourcing;
4. Trying to stifle social media is unlikely to be productive.

Big Data: Embracing Digital Procurement Strategy

Recently we have been discussing the need for a Digital Procurement Strategy - a strategy which sets out how to gain the optimum benefit from cloud, mobile and social. I hope you have found the series of interest - this is the last of the five sections.

If organisations are to seize that opportunity they also need to recognise the risk of being overwhelmed by data, yes, enormous amounts of data. Peter Smith recently highlighted this as the problem with information overload. Big Data analytics provide the solution.

An information deficit is removed by Digital Procurement Strategy but in its place comes information overload and clutter. Clutter which needs to be captured, curated, stored, retrievable, searchable, shared, analysed, and visualised. We have already discussed the potential benefits gained through conversations and listening within a global supply market stakeholder community. Digital means the conversations are linked and taking place simultaneously - a cacophony of amplified noise.

But conversations are only part of the digital equation, integration with the eProcurement systems is the other ingredient - that's a phenomenal amount of intelligence. Digital Procurement Strategy needs to make sense of that, it's almost like some GCHQ listener syphoning off what is important to procurement decision making and responding proactively.

Big Data analytics provide the means for making sense out of the clutter and we have previously discussed the excellent example of MBS' work on this with BMW supply chain. Digital Procurement Strategy is the means for strategically harnessing the opportunity and setting out how and the outcomes to be achieved.

Social Media: Embracing Digital Procurement Strategy

One of they key aspects of being sociable is the ability to hold a meaningful conversation. In a nutshell that's what social media provides to procurement - the ability to carry on a meaningful conversation. Of course that assumes that procurement has recognised the strategic advantages of 'talking with' as opposed to 'talking to'.

Think of the last time you had to deal with a point of clarification with a RFP - would it be easier and less open to challenge if you had that conversation with the market through micro-blooging sites such as Twitter or Yammer?

Now think of the benefits you've gained through private conversations. Is it fair to assume that sometimes someone has made a suggestion that has saved you a lot of money? Is it fair to assume that someone has triggered an idea for a better of way of solving a problem you've been struggling with? Is it fair to assume that someone has helped you avoid a crisis? I hope you have benefited from others suggestions in the past on how to reduce costs, creativity and innovation, and risk mitigation. Just visualise the benefits procurement could gain from conversations with the supply market, existing suppliers and potential suppliers, product and service users - social media makes that opportunity a reality, and your procurement strategy should set out how you will make use of the opportunity.

Having said that, social media changes the market place dynamics. The buyer may not shape the conversations but become the subject of the conversations. The potential for the buyer to be 'named and shamed as a bad payer' and also for the market to make comparative assessments of buyers is very real. Those conversations about the buyer are beyond the buyers control but have introduced new risks which need to be recognised and reflected in procurement strategy.

While there are a plethora of social media sites which can be accessed and have their place in a digital procurement strategy (such as, Yammer, Twitter, YouTube, Facebook, LInkedIn, Slideshare), starting from the perspective of available channels is an easily made mistake. Instead the starting position should be who are the audience you want to converse with and what is the outcome you want to achieve.

However, by way of suggestions, here are some potential uses of social media in procurement:

Mobile: Embracing Digital Procurement Strategy

Recently we have been discussing some of the potential impact of Digital and the need for a Procurement Strategy which embraces the digital opportunity.

We have discussed the high-level strategy and Cloud but in this blog I wanted to discuss Mobile.

Recall the recent past when, if you wanted to check your emails, you needed to be in front of your desktop. Remember how liberating it felt when you were able to pick your emails up through your Blackberry/iPhone/whatever.

Digital means we no longer need to be linked to a desktop to access our eProcurement systems. Nor do those other colleagues who would have perhaps had to complete paper records for subsequent data  input. With Quick Response (QR) reader codes you can go straight from mobile to the main platform in seconds without so much as keying in a single digit. But you don't need QR codes to benefit all that is required is a mobile device.

We now have apps on mobile phones, for example, which enable shopping cart requests to be approved remotely faster and at less cost which in turn improves P2P time.

Mobile means transaction costs are reduced and productivity is increased.

The Cloud: Embracing Digital Procurement Strategy

Last week I implied that Procurement has been a laggard, by comparison with Marketing, in embracing 'digital'. I suggested there is a need for digital procurement strategies which support the achievement of procurement strategic objectives, for example, cost reduction, innovation, risk mitigation, CSR. 

Before we can develop appropriate strategies we need to understand 'digital' and its potential. This blog discusses 'The Cloud' and in subsequent blogs I hope to discuss 'mobile', 'social' and big data'.

At a very basic level it may be suffice to understand that it is cloud technology which enables 'Apps' - no cloud, no apps. The impact for procurement is that Apps can now be accessed and developed to reflect our needs. The challenge therefore is to define the appropriate applications portfolio needs and, if an app doesn't exist, incentivise its development. The procurement professional needs to become both a visionary and a discerning selector of the ever increasing range of available apps. However, if you take this one step further you will understand than the cloud means apps can talk to each other, so, customers apps, marketing apps, suppliers apps, supply chain apps all have the potential to be interconnected and talk to each other - just visualise yourself in the London Olympic stadium and that you have the capacity to instantly exchange information and 'know how' with every other person in the stadium, including the athletes and the coaches, and every person watching the Olympics throughout the world - that's what cloud interconnectivity has the potential to delivery. 

One of the big impacts is that cloud completely transforms the eProcurement business justification.

Embracing digital procurement strategy

It has been reported that 60% of brand marketers anticipate a 40% increase in social media spend this year. That leads me to ask two questions:

1. How much influence does the CPO have over this increasing area of spend?
2. How much is being allocated within the Procurement budget for embracing digital as part of procurement strategy?

I'm not going to try to answer the first question at the present, although it would provide an interesting research question.

However, I'm inclined to hazard a guess, in answer to the second question, that most CPO's have not allocated anything in their budgets for a digital procurement strategy.

What do I mean by a digital procurement strategy? I'm referring to more than using mobile 'shopping cart' applications or twitter for advertising ITTs.  I mean setting out how procurement is going to make use of digital technology to achieve its objectives, say, for example, the objectives of cost reduction, risk mitigation, innovation, CSR.

By a digital procurement strategy I also mean how are you going to make use of the Cloud, mobile technology, social media and big data to achieve your objectives, and how you are developing the skills of procurement staff to address digital.

It has been clear that our sister profession, Marketing, has been concerned with digital strategy for some time. yet I see little evidence of Procurement giving digital much thought. Like Marketing, we too straddle the boundary interface between the internal organisation and the external environment - we have a responsibility for the upstream supply chain. We also have interfaces and communications needs with every part of the internal organisation and with buying partners.

Over the next few weeks I may give some more attention to the opportunities which the digital revolution provide for procurement. In the meantime I would be interested to hear of your own plans and experience?

Are you ready for Procurement Visibility: ProcureTruths

I wonder how many of you have come across Glassdoor; a website where potential employees can identify a particular organisation, the typical salaries paid to their varying levels of staff, what questions were asked in interviews, others experience of the recruitment process and what those who were successful in the selection process subsequently thought about working for the organisation. Some really interesting insights and all free of charge.

It came as quite a surprise to someone who recently wanted to discuss a 'compelling opportunity' with me, when I explained that the comments on Glassdoor made it clear to me there was little value in progressing the discussion.

I can see how Glassdoor could be used as part of procurement research in providing useful insights on bidding firms. Of course as Peter Smith rightly implies have we information overload?

However, visualise a similar service for the supply market, let's call it, 'ProcureTruths'. Perhaps ProcureTruths already exists unbeknown to me (please enlighten me if you know of it?).

Nevertheless, let's visualise that ProcureTruths, provides potential suppliers with information on specific buying organisations, say:

1. Key decision makers in the procurement process;
2. Procurements influence over spend;
3. Typical questions asked during the procurement process; 
4. Organisational tendency to maverick spend;
5. Buyers qualifications and currency of training;
6. Understanding and application of procurement best practice; 

Opportunity Knocks but can the NHS shine in buying music lessons?

Personal Budgets have been around in local government for some time.  They are now to be rolled out so that anyone within the NHS Continuing Care programme will be able to request their own Personal Health Budget. What does this mean and are there implications for procurement?

In theory Personal Budgets are the lowest form of devolved decision making you can arrive at and they maximise user choice. The person in need of care, rather than being told 'these are the services you will receive' is given a budget to purchase what they think is most helpful to their personal situation. This could include buying a dog for company, paying for music lessons, or, ... . Theoretically there is no reason we couldn't have the next Choir of the Year made up of recipients singing a song on their experiences of Work Capability Assessments!

£2.7bn a year will be spent on the programme - but could it be spent more effectively and will procurement expertise be drawn upon?

I would like to see commissioning, social services staff and those closest to the future recipient to help design the potential shopping list of services which may be required. I would then like framework agreements put in place which the recipients could access. If the 'price is right' and the quality matches the users need, then the recipient could 'call off' the framework.

Of course for recipients ease of access and visibility of the catalogue would need to match their experience of online shopping - could the NHS beat the best in the use of social media functionality for Personal Budget purchasing?

You may ask:

Big Data, Fukushima and applied research to support procurement

There haven't been many procurement lessons learnt from the Japanese Fukushima disaster. It is also rare that we hear of any useful applied research in SCM and Procurement. So when both converge in a Financial Times report on the work of Manchester Business School with BMW my attention was grabbed.

The background report itself is an interesting story relating to Supply Risk Management and development of an innovative tool. Specifically, following the Fukushima disaster, one of BMW's tier one suppliers couldn't deliver due to a lower tier subcontractor being within the Fukushima fallout zone - as a result BMW identified a need for greater supply chain insight. That need seems to have led to the students developing a tool for analysing internet content (Big Data), which could help with supply risk management. The tools being tested at the present are reported to: "read, search, sort and select large amounts of information in a systematic way, building up real-time profiles of each supplier and sub-supplier". That strikes me as a clever tool.

Of the examples cited one identified a risk of a supplier being unable to pay wages through content found in a local newspaper, while another relates to identifying a new supplier in Mexico.

It is not clear whether MBS are developing a marketing plan for their solution, but hat's off to them and the potential to reduce their student debt.

The Collaborative Organization (Book review)

An excellent, pragmatic book for anyone concerned with Digital Strategy and particularly Social Media (Web.2/E2.0) Strategy. While presented as focusing on intra-organisational collaboration, I feel that doesn't do the book justice, since it also addresses customer-facing dimensions.

I particularly liked the maturity model and could see that being of great use for baselining and also developing an incremental route-map.  My only word of caution relates to the Framework for Feature Adoption - while it is useful, it is just one route-map and my experience suggests there is no 'one-size-fits all'; what is important is to work with the culture of the organisation and the primary business outcome you're aiming to achieve.

The book was an easy read, well structured and something I could see being dipped into time and again.