This blog entry is inspired by Leo King, independent journalist, who recently asked three questions and interviewed me for an article in The Times, 21 January, “Building a First-Class Procurement Function.” These are my notes in preparation for the interview, with a few additions and corrected grammar for this publication.
Author Archives: Tony Colwell
Some cautionary advice on the use of Supply Positioning
A recent discussion with procurement consultant, Bill Young, caused us to reflect on the use of ‘supply positioning’ as a model for developing strategies to add value through procurement. We considered the possibility of positioning procurement projects rather than purchase items or supply categories. I concluded that this application had potential but also had practical difficulties. The use of supply positioning by Procurement, without the engagement of other stakeholders, is dangerous. As supply positioning is often misapplied, I thought I might share my thoughts here. Continue reading
Supplier Classification – How to show suppliers where they stand
Recently I commented on a LinkedIn discussion, “Presently I am looking to devise a simple classification structure for my supply base – something that will allow my suppliers/providers to know where they presently stand from an engagement/expectation perspective and that shows them what they can work towards…. Does anyone have examples of such structures that they can share?”
My reply (edited): Continue reading
Can leaders dispense with collaboration?
Today, on seeing @HarvardBiz’s tweet, “We respect leaders more when they don’t need co-pilots,” I was compelled to read the corresponding article in Harvard Business Review, “Why Command-and-Control Leadership Is Here to Stay.” The article comments on the Vroom-Yetton model of leadership, which identifies five different decision-making styles, ranging from autocratic to consultative to group-based decisions. I found the tweet and headline provocative (although the article rather less so). Continue reading
Stakeholder Engagement Spectrum (Infographic)
Infographic illustrating degrees of stakeholder engagement and the significance of leadership style, type of change, and required co-operation or collaboration.
What innovators can learn from Cost to Serve
The concept of Cost to Serve has been around for many years (to my knowledge at least 20) and is an important tool in consumer packaged goods industries. Cost to Serve is a method of identifying profitability of individual products and customers. It is also used to unravel the complexity of multiple supply chains and channels to market. The analysis of the cost of each activity across the supply chain also provides data and insights to enable supply chain optimisation.
The focus of Cost to Serve is usually the in-market or post-launch costs of serving a product to a customer. Cost to Serve rarely looks at the development and launch costs of new products, which is the focus of this article. Yet product development teams can gain benefit from Cost to Serve methodology. Continue reading
Supply chain: a cross-functional collaboration… or the blinkered approach of functional silos?
A recent post in Purchasing Insight, “What can game theory teach us about Financial Supply Chain Management?” highlights the overall financial impact of paying suppliers as late as possible. The key point is that the working capital cost to supplier usually far outweighs the savings to the customer, thereby increasing the overall cost to the supply chain. The post got me thinking about a much bigger issue: how businesses manage their supply chains – a cross-functional collaboration or a collection of functional silos? Continue reading
Change Management: How to overcome stakeholders’ resistance to change
Following up on some recent tweets on employee motivation and engagement, I was reacquainted with Gleicher’s Formula for Change, published by Beckhard and Harris (also known as Beckhard and Harris’s Change Equation). Although I agreed with the formula when I first saw it several years ago, I rather dismissed it as a statement of the obvious. On reflection, it is a more powerful tool in change management than I first gave it credit. Continue reading