September 26th, 2018

Want to improve your teams performance? Consider shrinking first.

https://www.supplychaindive.com/news/procurement-teams-small-world-class-hackett-group-research/531000/
​
In reading Rich’s article the other day I realized it reinforces what we already know about technology and it’s influence on the way we work.  It’s the same story across all operational functions.  Technology and automation helps the business operate with greater efficiency but as long as it’s implemented correctly including “breaking stuff” we used to do before.  Like any tool it can do more harm than good if used incorrectly.  Think about that for a minute.  Technology could harm your business if not implemented correctly.    
​ 
Data has always been a staple in procurement as it allows teams to determine what the business needs and how to support those needs via the extended supply chain.  Contracts are negotiated, suppliers are squeezed or cut, product decisions are made.  All based on the data organizations leverage in the management of their supply chains.

In our experience many organizations are collecting data at an ever-increasing rate, but these same organizations struggle with how they can create action with the data.  Many times, the organization doesn’t even know why the data is being collected or the data is stored in offline files or fringe databases which are isolated.  These teams have data coming out of places they didn’t even know existed.  The “too much of anything thing problem”.  What can you do to get a better grasp on what data you have and what to do with it?  Consider answering 3 questions to hone your efforts.  Answer these for every set of data you plan to collect.

1. What’s the purpose of collecting this information? – basically your “why”.
2. How will you collect this data and how much scrubbing will be required? – define your process to make the data usable and actionable
3. What is the data collection plan? – define the process as a project that has a clear beginning, middle and end.

The power of the data is when it all comes together to create “layered intelligence” and in procurement this layered approach is where the value is.  Unfortunately similar to the chicken and egg scenario most organizations question what to do first?  Should they pull all that data together or try to understand what information is important and then put only what’s important together?  When priorities push against these questions, the decision usually is to push the decision to later – which we all know is almost never or means “we’ll stick with what we have already done with some minor changes”. 

This doesn’t do anyone in your organization good.  It probably means all the same people are doing what they were before with additional overhead which drives down their efficiency.

Consider Rich’s article as a way to measure your organizational journey.  Are you seeing improvements with your changes?  Are your best people doing strategic work because they were able to automate something they did before, or did they merely hand it off to someone else?  If it was handed off to someone else, then really did you gain anything?

If you need help with your data management and collection process we’d be happy to help or can provide guidance to experts in the field.  There are several great resources out there.  Bringing in outside help sometimes can be a fresh perspective to what internal teams see.

​#RichardWeissman #shrinkingprocurement