Logistics and Supply Chain in Emerging Markets (Kogan Page, 2014) by John Manners-Bell, Thomas Cullen, and Cathy Roberson adeptly captures the interconnectedness of global economies and commercial activity while also studying a number of countries and industries independently.
Humanitarian Logistics: Meeting the Challenges of Preparing for and Responding to Disasters (Kogan Page, 2014), by Peter Tatham and Martin Christopher, provides a look inside the challenges faced by the people and organizations providing relief after disaster strikes.
When we were preparing for last week’s annual Thanksgiving post (which you can read here), we pulled all of the titles and authors that included me in their launches this year. I actually managed to review 18 books this year (although I still have two to go before the clock runs down).
As always, there are a few that really stand out as being worthy of a professional’s extremely scarce reading time. I’m going to make a wild assumption that most of you don’t have time to read 20 books on top of your other responsibilities just to get your creative juices flowing.
If you, like me, have been ‘awful good’ this year, here are a few titles that you might want Santa to slip into your stocking.
“As supply chain complexity increases, so do the services which logistics providers are asked to perform. No longer is logistics seen as a tactical activity, where the gains made are purely measured in terms of transport or warehousing cost savings. Instead, customers become more engaged in the transformational impact on supply chain competitiveness which a logistics provider can achieve.” –Manners-Bell, p. 23
Global Logistics Strategies provides the characteristically thorough and thought-provoking coverage we have become accustomed to from author John Manners-Bell. In his acknowledgements, he mentions that his father set up a transport company in the 1970s. Logistics is clearly in his blood.
“To succeed in business is more complex than it used to be - it is no longer economically desirable to control all the components of your customer value proposition.” (p. 6)
Strategic Procurement by Caroline Booth (Kogan Page, November 2014) is a second edition, updated from its original release in 2010. Before I even get into the book’s content, I think it is worth reflecting upon the pace at which the procurement profession is changing. In the four years since Booth first released this book, there have indeed been significant changes in economies and business dynamics, requiring equally significant adjustments in procurement. In the preface, Booth calls out her increased focus on risk and the improved position of procurement, as well as enough changes in M&A involvement to add a whole chapter on it.
“Although procurement has certainly evolved from its early roots, it still faces challenges in terms of executive recognition, talent management and organizational challenges. Modern enterprises are faced with a massive set of new challenges, including the forces of globalization, increased risk, complex supply chains, and the spread of government regulation on decision making, not to mention the tremendous strain of man’s presence on the earth’s natural resources.” (p. 1)
The Procurement Value Proposition (Kogan Page, December 2014) takes on some of the most pressing challenges facing procurement today and makes them seem both more comprehensible and realistically addressable. As acknowledged in the quote above, taken from the book’s introduction, procurement has evolved significantly since the early days when we got our start in the railroad industry. The problem we must own today is that the organizations we support have evolved faster and more dramatically than we have. What procurement needs is a better understanding of how to fuel our development.
“When you prepare an RFP, your goal is to elicit responses that meet all of your requirements so that you can move efficiently to awarding the contract and implementing the systems you need. But only a quality RFP will get quality responses. Not surprisingly, bad RFPs bring in bad responses.” (p. 13)
The Art of Creating a Quality RFP (PSM Advantage, 2014) serves as a valid reminder that if we don’t approach every task we undertake as valuable, we deprive ourselves of the opportunity to do our best work before we have even begun. This book, written by career practitioners and consultants George Borden and Steve Jeffery, captures the ups and downs of decades in procurement. By focusing almost exclusively on the Request for Proposal (RFP) they are able to achieve clarity of purpose and message and cover a lot of ground in a compact book.
“Procurement’s role shines particularly when strategic cost management receives the highest priority for many executives.” (p. 197)
Leading Procurement Strategy (Kogan Page, 2014) is a group study of the ‘brave new world’ of procurement. The three primary authors, Carlos Mena, Remko van Hoek, and Martin Christopher (and three guest authors), address an ambitious list of trending procurement and supply chain subjects. Rather than causing problems with voice or style continuity, this large group of contributors makes it possible for the book to cover a wide range of information in depth without losing momentum or focus.
Although the authors have decades of experience in procurement, they are not mired the ways of the past. In fact, they discuss many of the new approaches being considered by procurement (e.g. agility, supplier collaboration, non-savings performance metrics). They also acknowledge the objections procurement is likely to face in response to attempts at evolution and provide methods to constructively overcome them.
According to Martin Christopher, who wrote the chapter on Global Sourcing, procurement can expect an increased emphasis on agility. This translates into a shift in how supplier relationships are built and how contract management strategies are executed. In fact, agility may provide an escape route from the savings trap that confine many procurement organizations. When operational agility is prioritized over cost savings, supplier selection and agreement terms must change. “The guiding principle should be that the best sourcing decisions are those that keep the most options open. There will usually be a price to be paid for these options but that price should be seen as an investment in supply chain flexibility.” (p. 90) In other words, if the entire organization can see (and quantify) the opportunity associated with agility, they will not only request for procurement to change their priorities, they will demand it.
Helping other functions focus on total cost rather than price elevates the perspective of the entire organization and brings the internal implications of supply decisions into greater focus. For instance, procurement may want to start initiatives by demonstrating the relative costs associated with non-flexibility or lost opportunities in research and development or new product introduction. “Strategic cost management should be part of new produce and service design, so that the most cost effective highest-value products and services are introduced in the marketplace.” (p. 104)
If procurement expects to expand the perspective of their internal stakeholders, they must be willing to do the same themselves. More procurement activities should be tied to consumer and market demand. Just as wanting to collaborate with a supplier is not enough to make the effort a success, wanting to bring procurement into closer contact with the consumer side of the business will not make it so. The organization must be open to the idea and positioned to benefit from the resulting changes.
In my opinion, the best quote from the book is a definition of complexity, found in the chapter on Supply Chain Risk Management:
“‘Complexity’ describes a condition of inter-connectedness and interdependencies across a network where a change in one element can have an effect on other elements – often in unforeseen ways.” (p. 134)
The role of complexity, and procurement’s ability to make positive contributions to how the organization handles it, will be a primary driver of how much access procurement will be given to customers and whether or not it therefore makes sense to take a less cost reduction focused approach.
Supplier Relationship Management (Kogan Page, available Oct. 28, 2014) is the third book I have reviewed by Jonathan O’Brien, a Director and co-owner of Positive Purchasing with over 20 years experience in purchasing. As we have come to expect of O’Brien’s work, this book provides an extensive look at the metrics, relationships, and change management considerations associated with supply base collaboration.
It is true that supplier relationships, innovation, and collaboration are among the topics du jour in procurement, but O’Brien proves himself well versed in the associated opportunities and challenges.
Warehouse Management: A Complete Guide to Improving Efficiency and Minimizing Costs in the Modern Warehouse, 2nd Edition (Kogan Page, 2014), by warehouse management and logistics specialist Gwynne Richards, is a comprehensive guide to all considerations for managers looking to improve the effectiveness and efficiency of their warehouse operations. In fact, that title does not do the book justice, and “Complete” is a term not to be brushed over in this case. A Guide to Modern Warehouse Safety, Automation, Sustainability, Outsourcing, Systems, Picking, Equipment, and Performance Management Strategy is more accurate but not concise or catchy enough.
“By 2020, procurement’s role will have become even more important for sustaining constant supply, best cost, reduced volatility, faster and improved innovation, and clean corporate-brand image.” (p. 179)
Procurement 20/20: Supply Entrepreneurship in a Changing World is a team effort by four members of McKinsey’s Global Purchasing and Supply Management Practice: Peter Spiller, Nicolas Reinecke, Drew Ungerman, and Henrique Teixeira. If you were at the Institute for Supply Management’s conference in Las Vegas this May, you might have even picked up a copy for free. (Thanks to Cottrill Research’s Jeanette Jones for grabbing my copy!)
Supply Chain Risk, by John Manners-Bell, provides a structured look at risk by establishing a series of intersecting dimensions. First the author outlines external risk categories: Environmental, Economic, Societal, Security, and Technological. Each has several sub categories that provide additional detail and clarity. Then he delves into a number of industry sectors to consider their resiliency factors and concerns: Automotive, High tech, Consumer goods/retail, Food, Fashion, and Pharma/healthcare.
The coverage from both perspectives is equally detailed and illustrated with numerous case studies. In their intersection, for instance where Economic risks intersect with the Automotive industry, any supply chain professional will find the information they need to quickly come up to speed on key areas of concern as well as strategies for assessment and mitigation.
Can China Lead?
Reaching the Limits of Power and Growth
Can China Lead?, by Regina M. Abrami, William Kirby, and F. Warren McFarlan, asks a question that can not be definitively answered but is well worth asking. The authors seamlessly combine their knowledge of China’s history, people, and politics to advise companies looking to engage in commercial interactions with one the world’s second largest economy (As ranked by GDP by the United Nations, 2012). As the authors state in their Introduction, “Chinese businesses compete globally, now going head-to-head with North American and European corporations in telecommunications, heavy machinery, and renewable forms of energy.” (p. x)
Negotiation for Purchasing Professionals is the second book by Jonathan O’Brien that we have reviewed. Earlier this year we reviewed Category Management in Purchasing. While each of the books has a different focus, they have more in common than just an intended audience. The most striking similarity is a clear desire to improve the knowledge and capabilities of purchasing professionals by capturing O’Brien’s considerable experience and communicating it in a straightforward manner.
Buying and Selling Information, by career salesperson Michael L. Gruenberg, is a guide to help buyers of information services (think subscription-based online databases). Beyond this very specific case, Gruenberg has good advice to offer buyers and sellers of any product or service. He is a salesperson who ‘gets it’ – or understands the need for buyers and sellers to work together for their mutual benefit, and for the benefit of their organizations. In his own words, “It’s all about equal footing, momentum, and success” (xviii).
One of the best things about having good relationships with publishers is that I end up reading and reviewing titles that range beyond procurement or spend management. And yet, there is no question that the value and competitive advantage of a well-managed supply chain runs right through the center of all business strategy books.
The rise of mobile technology requires that procurement solution providers and practitioners be innovative about potential opportunities for improvement and problem solving. Through virtual team models and global supply chains, the applications and requirements of mobile technology are coming, whether procurement drives the implementation or not. In a July 2013 article on ThomasNet’s imt Procurement Journal, Pat Toensmeier referenced a study about the expected adoption rates for mobile technologies in procurement. “A study by AnyPresence Inc., a Reston, Va., company that specializes in mobile business processes, products, and services, finds that 31.5 percent of respondents have deployed or will deploy mobile apps for procurement, among other functions, in the next 12 months. An equal proportion will do the same with apps for supply chain partners and shipping and distribution.” As we approach the end of that 12-month period, no developments have surfaced that look likely to reverse the trend.
The Moment of Clarity was a joint effort by ReD Associates founding partners Christian Madsbjerg and Mikkel B. Rasmussen. Their careers have focused on studying human behavior, problem solving, and innovation. In this book, they apply what they have learned and observed to the challenges faced by businesses today. It is apparent to the reader that they are avid readers in their own right, and their bookshelves clearly hold titles representing a wide array of fiction and non-fiction topics.
Kaizen Kreativity is the fifth book by Dr. Tom DePaoli, and the third one I have reviewed. Like his other books, Kaizen Kreativity combines examples from his diverse professional past with easy to comprehend definitions and background. His lack of pretension is particularly appreciated since he often relates cases about Lean and Six Sigma. For anyone without experience using these methodologies, the terminology can be off-putting at best, and in the worst case scenario may deter people from realizing their benefits altogether.
Despite the fact that Marcy Phelps’ Research on Main Street is not necessarily written for a procurement audience, it offers invaluable advice as well as links to the resources required to carry that advice out. The idea of ‘local’ is not limited to the location of the researcher, but rather the information being sought. Another way of looking at it is point-point information, highly specific to a business need and detailed enough to motivate a decision.