by Nick Picone, Trust Your Supplier VP of Advisory Practice
“Regulatory fines and penalties for non-compliance are steep. In 2018, non-compliant firms were subject to $3.945 billion in penalties and another $794 million in judgments related to SEC investigations and complaints, while FINRA imposed $61 million in fines.” – What’s the True Overall Cost of Non-Compliance?, complysci (2019)
As illustrated by the above excerpt from a 2019 article, compliance challenges were an issue even before the pandemic hit. But when you learn that there were $3.945 billion in penalties – which is a significant number, in my opinion, what does it really represent? Is it a call to action or such an incomprehensibly large figure that makes you think, “wow,” and move on to pressing “right in front of you” demands?
Let’s face it, with the pandemic, war in Ukraine, persistent inflation, and a myriad of other “challenges” that we are facing, if it doesn’t affect you directly, $3.945 billion is someone else’s problem.
Even when you break down the numbers and demonstrate how non-compliance costs firms “nearly three times the cost of being compliant,” it does little to create a sense of urgency beyond passing awareness. By the way, the actual dollar figure for non-compliance in fiscal 2017 was $14.82 million. Conversely, the estimated cost to ensure your organization was compliant with existing regulations at that time was $5.47 million.
The Lens of Inertia
Like high blood pressure, inflation, and the fact that Netflix seems to cancel great series for no apparent reason, we all know compliance is “important,” but we can’t do anything about it, can we? There are so many other, more granular things to worry about from a collective and personal standpoint.
For example, at one of the many conferences I have attended over the past two months, it was alarming to see firsthand how many people had name badges that said “former” or “looking for work.
“My point in all this is that we have to, first of all, recognize the realities of the general mindset in our industry. How can you expect a procurement team to worry about carbon footprint and conflict minerals when there is so much economic uncertainty? Even in good times, there is a long history of “risk recognition and inaction.” A McKinsey 2006 survey provides compelling evidence of how risk avoidance was more a state of mind than an actual event.
While not as acute, the challenges we faced in 2006 are no different from those we face today regarding compliance. The question is this: why will our response be different this time?
One reason I think it will be different this time is that the cost of non-compliance increased by 2,650% from 2017-2019, which is the definition of exponential growth.
Ideal Conditions For A Speed Trap
“A hidden scaffolding of financial incentives underpins the policing of motorists in the United States, encouraging some communities to essentially repurpose armed officers as revenue agents searching for infractions largely unrelated to public safety.” – New York Times (2021)
According to one report, the average police officer writes 100 to 150 tickets each month. While that number can vary from city to city, town to town, it is safe to say that when it comes to moving violations such as speeding tickets, there is a noticeable police presence, e.g., speed traps at the end of the month. Yes, this is an anecdotal observation, more than a scientific conclusion. But does that make it any less accurate?
Here is the reality. During tough economic times, government deficits increase. There are primarily two ways to plug deficits. The first is to cut spending and the direct and indirect taxation of people and businesses. This approach rarely happens.
When you look at the size of fiscal deficits and all the fines that businesses across the globe will eventually face, you can see how governments understand that they have a unique speed trap set from an enforcement perspective, as companies have no good way to effectively and efficiently manage their large and extended supply networks from a compliance perspective.
To be clear, this is not an anti-government rant. It is a reality.
If you disagree with me, google the term “sin tax.”
According to one of many definitions, “sin taxes are usually placed on the sale of cigarettes, liquor, tobacco and other goods that are considered dangerous to individuals or society.”
There is a clear parallel here when you think about conflict minerals, global warming, modern slavery, data privacy, etc.; these are also societal issues that negatively affect us all.
Stay tuned for Part 2: How To Avoid The Non-Compliance Speed Trap (What’s The Opposite of Cynical?)
Let’s get the cursory narrative regarding the cost of missing data out of the way first.
We have all heard Peter Drucker’s business maxim, “If you can’t measure it, you can’t manage it,”. It is a timeless guidepost of how we run our businesses. By the way, Peter never actually said that, but that is a story for another day.
Then we can turn to the various articles and studies over the past few years reporting that bad or poor-quality data costs the U.S. economy $31 trillion annually. That’s a big number, and so is the finding that 90% of the world’s data was created in the last two years.
The above are all facts and verifiable. But what do they really mean? What does missing or inaccurate data really cost on a practical, everyday level?
There are better venues for a deep analysis than the limitations of an article or blog post. My focus today is to start a dialogue enabling you to transition data strategy from a broad horizon concept to an actionable on-the-ground understanding. In other words, you already know that data is important and that there are consequences for missing or inaccurate data. What’s needed now is to answer the question, what will you do about it?
In an upcoming webinar, we will convene a panel of industry experts and thought leaders to closely examine data challenges from the following three critical points:
3-Point centralized planning & supplier oversight data framework
When we talk about “data consequence,” we are not talking about broad-stroke generalizations but a fundamental and accessible understanding of impact.
For example, a news article reported that due to a data glitch, Hawaiian Airlines charged dozens of customers “hundreds of thousands of dollars in credit card fees.”
One customer reported being “mistakenly charged more than $150,000,” even though they have a “$10,000 limit on their Hawaiian Miles credit card.”
While another customer was charged $674,000 for airline tickets, others obtained free travel vouchers by paying taxes and associated fees. You can imagine the frustration when the airline canceled their flights.
Beyond a financial mess, the airline’s reputation also took a significant hit. How do you measure that in dollars?
Unfortunately, examples like the one above are not rare or isolated incidences limited to the travel industry. Nor do most cases present themselves in such a prominent and noticeable way. Data quality erosion is an even bigger problem because you may only recognize it once its impact is evident on a larger, less manageable scale.
Creating The Right Culture
Given the volatility of supply networks in the post-pandemic world, it isn’t surprising to hear the C-Suite talk about supply chain visibility, resilience, and risk management.
A recent post by Nick Picone regarding a contentious issue about inflationary price increases between a large, national grocery chain and Frito-Lay underscores the importance of data visibility and transparency.
But how do you get to the point of leveraging tools and technology to move from data darkness to data insight and understanding?
A May 2021 article in Procurement Insights highlighted the importance of creating a data culture starting at the C-Suite level. According to the author, CEOs must “recognize the importance of data beyond a conceptual perspective and see it in a practical bottom-line context.” Citing everything from “customer satisfaction and regulatory compliance” to employee empowerment, they make a strong case for “becoming a data-driven organization.”
The 3-Point Supplier Data Plan
Partner, Mitigate, Comply is at the heart of the 3-Point centralized planning & supplier oversight data framework. Going forward, I will call it the 3-Point supplier data plan.
The 3-Point supplier data plan focuses on providing tools and data for organizations to efficiently partner with trusted suppliers, mitigate risk, and ensure ongoing compliance.
In addition to data consequence and culture, during the upcoming webinar, the panel will get into the specifics of the above 3-Point plan highlighting how you can introduce it to your organization. Register to save your seat.
Recently, I was on a panel at Wake Forest University, School of Law, NC on this subject, and it triggered my interest in digging deeper into this space. Chainyard has been involved in ESG via its SaaS platform, Trust Your Supplier, since 2020. I occasionally participate in the Hyperledger SIG on Climate Change where many different topics are discussed. The goal of this article is to share my thoughts as I continue to expand upon that knowledge in the coming months.
What is ESG?
ESG expands to Environment, Social, and Governance. There have been many subsets of it in the past, but the current incarnation is a result of concerns about the climate, environment, and social justice. ESG is complemented by DEI which looks at diversity, equity, and inclusion in society and at the workplace.
Businesses have an impact on our Earth. It includes human and machine activity, and the use of natural resources including water, fossil fuels, raw materials, and minerals. These can result in greenhouse gas emissions like CO2, pollution of the air we breathe or water we drink, deplete natural resources, generating vast amounts of waste, etc. The ESG framework measures the degree to which a corporation adheres to sustainable and environmentally responsible practices.
Organizations have relationships with customers, partners, people, and communities. ESG measures the social impact on people both internal to the company and customers and supply chain partners. Many questions arise such as how workers are treated, do they get living wages and good healthcare, are the labor practices acceptable, are the communities they serve benefitting, etc.
Governance refers to a corporation’s management practices related to ethics, regulatory and legal compliance, and transparency in reporting. Companies have to establish policies, procedures, guidelines, and measurement frameworks to achieve these goals. “DEI” or diversity at the workplace, equity in opportunities and wages, and inclusion are all part of governance activities.
According to Moody’s, a 2022 survey of their customers found among other insights,
“Customers also indicated that rising customer expectations, environmental, social, and governance (ESG), and future of work, are the trends expected to affect their business the most”
Saving the Planet
Fixing the damages caused to the environment by human activity requires a multi-pronged approach. Though it is generally accepted that the main contributor to the climate crisis is CO2 emissions, the environment has been seriously injured by many factors; key among them being the disposal of plastics, which is now the major cause of ocean pollution and the extinction of many species.
To address the crisis, there are several projects put in motion by NGOs, governments, and global institutions. Some of them are voluntary and others are imposed by regulation. These projects fall under several categories such as:
Carbon Farming and Sequestering
Migration to electrical energy
Transition from Fossil Fuels to Renewable sources
Carbon Offsets and Credits to compensate for emissions
Carbon Insetting through corporate self-improvement initiatives
Plastic Waste collection, sorting, recycling, and disposal
Discontinue single-use plastic items.
Measuring the impact of micro-plastic pollution
Land and Water Management
Forest management (re-forestation, conservation, and afforestation)
Restoration and protection of coastal wetlands and marine life
Efficient and effective collection, sorting, and recycling of industrial and household waste.
Reprocessing electronic waste to extract valuable metals and reduce the discharge of toxic chemicals into the environment.
Excess inventory sharing by enterprises with others.
Manufacturing products using sustainable processes and raw materials.
We are all familiar with how our government is pushing for a rapid transition to Electric Vehicles (EVs) and renewable energy from wind and solar power.
Carbon Offsetting, Credits, and Insetting
We need to understand what strategies corporations are using to achieve net-zero goals. Corporations make commitments to the industry or the government about becoming carbon neutral or reducing their emissions. In order to meet those targets, they invest in projects that address in part or full those commitments. These projects can be internally triggered, or the corporation can fund third-party projects.
It is generally agreed that 1 offset or credit is equal to 1 metric ton of carbon dioxide emission (CO2e). A typical tree planted in a reforestation program takes about 40 years to sequester 1 metric ton of carbon. The same amount is roughly emitted by an automobile in about 3 to 12 weeks.
Carbon offsetting is a mechanism by which a company that has been emitting CO2 and is not yet ready to fix its process, technology, and operations, funds offsetting projects in the voluntary carbon market (VCM). For example, ACME Corp. which has been emitting 100 metric tons of CO2 could invest in the MOSS Project which supports the preservation of the Amazon rain forests to offset its emissions. For a novice, offsetting works as shown.
Some typical projects include:
Wind farms, hydropower projects, solar power plants
Other renewable energy projects such as fusion
Landfill gas capture and management
Providing energy-efficient appliances to local communities such as the recent push in NY To ban gas stoves.
Farm power, methane capture, and biogas production, something very common in Asia and Africa
These are regulated credits also referred to as Cap-n-Trade. The Government or the Regulatory Body sets caps on carbon emissions which translate into “Emission Allowances”. These allowances are available for purchase as “Carbon Credits. Business entitiespurchase “Carbon Credits based on assigned emission allowances. These allowances are gradually reduced over time to realize tangible emission reductions.
Insetting refers to a Business Entity reducing its own emissions through the adoption of new technology, optimizing supply-chain processes and practices, and improving efficiency. Insetting is more important as it enables a company to take ownership and responsibility for its emissions.
Actions a company may take include deriving more of its energy from renewable sources, management of resources such as water and raw materials, and enforcing ESG across their upstream and downstream partners.
Key issues in the Measurement and Reporting of ESG initiatives
Currently, there are many projects by various organizations in the voluntary carbon market. There is no consistent way to verify if these projects are genuine and truly deliver the benefits they promise. Some of the issues are:
Consistency in the application of policies and regulations
No single or integrated verifiable and trusted project registry
Too much focus on CO2 emissions though the environment is harmed by various other activities.
Potential Double Spend problem (accounting of credits and offsets)
Traceability of Offsets & Credits throughout their lifecycle from issuance to retirement
Transparency of project status and benefits
Consistent and verifiable (regulatory) reporting
Blockchains have a bad reputation for being energy-intensive, and thus not climate or carbon friendly. Well, that comes from Bitcoin mining and other public blockchains that supported the proof-of-work (PoW) consensus protocol. PoW is very CPU intensive and consumes a lot of energy to solve a mathematical challenge essential for block verification and earning crypto. However, most other blockchains support better protocols such as proof-of-stake, BFT, or proof-of-authority which are much more energy friendly.
A blockchain is a valuable tool that can help address many issues. It extends enterprise solutions and can work cohesively with IOT and AI/ML technologies.
An immutable record of data enables “track and trace” of projects, the provenance of lifecycle events, and transparency. All this depends on stakeholders including applications and things recording data into the ledgers.
Smart Contracts can help with governance, enforcing policies and business rules, and managing tokens issued as offsets, credits, and incentives.
Decentralized Identity is a relatively new concept and can be applied to projects, people, organizations, and things. Every project can be assigned a DID and tagged with verifiable credentials by bodies such as Carbon Action Reserve, Verra, and the like. DIDs are cryptographically verifiable, universally resolvable, and enable Proof-of-Existence and Proof-of-Verification
Consensus protocols such as Proof-of-Stake allow validators to verify transactions and maintain consistency and integrity of the ledger
Privacy and Anonymity are very important for organizations. Using encryption and secrets, organizations can be transparent about their commitments and actions, yet implement privacy and confidentiality to avoid exposing their business secrets and intellectual property.
Three use case patterns where blockchain can augment ESG initiatives are:
Provenance, and Track & Trace of ESG Projects
Facilitating the trading and trustable record-keeping of Carbon offsets and credits (tokens)
Supporting risk, audit, and compliance reporting
These patterns cut across many domains such as supply chain, health care, real estate, and energy,
Organizations and Bodies involved with Sustainability Initiatives
It was enlightening to see the number of organizations and companies involved with climate initiatives and ESG.
Some of the notable ones are:
Verra is one of the most recognized and trusted providers of standards and guidelines for sustainable development. The Verra registry is a repository of certified and verified projects.
Climate Action Reserve is approved to serve as an Offset Project Registry (OPR) for the Compliance Offset Program under California’s Cap-and-Trade Program. They also maintain project registries and support various carbon offset programs.
GHG Protocol According to their website they provide standards, guidance, tools, and training for businesses and governments to measure and manage climate-warming emissions. One can download worksheets and tools to measure and record carbon emissions footprint.
The Gold Standard is another reputed and recognized organization that provides standards, verifies and certifies carbon projects, and maintains project registries.
Other organizations include
American Carbon Registry
CSA Group Registries
Climate, Community & Biodiversity (CCB) Standards: Certification to the Climate, Community & Biodiversity (CCB) Standards demonstrates that a project simultaneously addresses climate change, supports local communities and smallholders, and conserves biodiversity
Task Force on Climate-related Financial Disclosures (TCFD) – Increased reporting of climate-related financial information.
Verra – SD-VISta The Sustainable Development Verified Impact Standard (SD VISta) – Premier standard for certifying the real-world benefits of social and environmental projects, from gender equity and economic development to affordable clean energy and restoration of wildlife.
The United Nations’ Sustainable Development Goal 7 (SDG 7) focuses on reliable and clean energy modern energy services, as defined in its Target 7.1
Paris Accord on Scope 1/2/3 reporting
United States – Environmental Protection Agency
European Commission (2020) Circular Economy Action Plan
Open Earth Foundation
Hyperledger Foundation – Climate SIG
Many projects support ESG such as the MOSS Project, Toucan, Plastic Bank, Save The Planet, Klim DAO, and Greenly. The notable ones that need mentioning are:
Trust Your Supplier – Chainyard is a SaaS blockchain network focused on supplier risk and qualification. Workflows help customers capture supplier ESG initiatives and actions and get them verified through third-party verifiers who provide ESG rating scores.
TYS has standardized the information capture to gather ESG information that can be used by organizations to support Scope 1 & 2 reporting today, and a goal of Scope 3 in the future.
Title Chain – Borsetta is an evolving network that enables asset track and tracing of energy micro-grids, helps secure their title, and tokenizes the grid and energy production among other functions. Though it is not directly related to ESG, it mainly targets microgrids that support renewable energy ecosystems, including the energy they produce and the excess quantity sold to the national grid. Microgrids serve campuses and are seen as the future of community-driven energy production.
Digital Credentials for Carbon Accounting is an initiative by the British Columbia government in Canada. The initiative known as “Traction” set up under the Energy & Mines Digital Trust supports the BC Government’s requirement for certified annual sustainability reporting. The solution is built on a blockchain platform based on Hyperledger Aries and Indy and leverages the Decentralized Identity (DID) standards protocol. The mining companies collect data for sustainability reporting, which is verified by organizations such as PWC resulting in the issuance of a Verifiable Credential that can be shared with the government.
ESG and Blockchain (A conceptual architecture)
Earlier in this article, we discussed how a blockchain complements ESG solutions. Can blockchain add value beyond Carbon Offsets and Credits? Yes, there are many reasons.
The Blockchain can serve as an ESG BUS providing access to various services such as project verification and tokenization
Many institutions maintain verifiable registries of carbon projects, some enabled by blockchains, and others provide APIs. A decentralized identifier can be assigned to every project. Decentralized identifiers are a W3C-enabled standard and specification to define the structure, attributes, and architecture of DID and its constituents. DIDs are universally resolvable to “DID DOCS” which are JSON documents present authentication schemes, digital signatures, and service endpoints to access various aspects and details about the project.
The blockchain can record hashes (aka digital fingerprints) of data received from IoT sensors that track emissions or watch human activity, thus providing immutable tamper-evident proofs for later audit.
Carbon offsets and credits are offered by various organizations. A unified solution can act as an interface for enterprise blockchain to have access to those marketplaces and exchanges.
Enterprises having insetting programs can record the lifecycle of their projects against commitments, thus offering transparency into their programs. Solutions such as TYS capture and/or process such information in their risk assessment workflows. Blockchain “Oracles” assist in making those connections and ensuring the reliability of the source and the received data.
AI ML algorithms and third-party rating providers can calculate ESG scores. which can be recorded with proofs and signatures. Today many companies such as Bloomberg, Ecovadis, CDP, Moody’s, D&B, S&P Global, and other analytics firms provide the service and can secure their ratings on a trusted decentralized ledger.
Lastly, both enterprise and public blockchains have a role to play.
Governments across the world and global conferences such as the World Economic Forum-Davos, United Nations Climate Conferences held in Kyoto and Paris, and UN Climate Action i.e. COP27 are focused on actions to address climate change. The “E” in ESG is not just limited to carbon emissions but includes plastic waste and other human and industrial waste, non-carbon pollutants. and management of our forests, coastal and marine life. While Carbon offsets have been used as a tool by individuals and industries, it does not make them responsible for their actions. The impact of offset projects has been difficult to measure and report. Insetting as a goal puts more responsibility and accountability on corporations to improve their process and technology. Blockchains can help bring more trust, transparency, accountability, and compliance to ESG management. Also, it is unclear, how much of the geo-political events and industrial disasters are taken into account such as the war in Ukraine, the Norfolk Southern toxic spill in Ohio, or the dairy explosion that occurred in Texas.
Chainyard is a boutique blockchain consulting and advisory firm based in Morrisville, NC. As the first Hyperledger Certified Service Provider, it has executed over 50+ projects. Chainyard’s Trust Your Supplier enables supplier risk assessment and qualification including ESG-related risks. To learn more, please send me an email or visit our website.
Managing one global business in an ever-changing world is tough enough but managing three?! Now, that requires nearly superhuman leadership skills.
Meet Sri Mudunuri, the co-founder of IT People Corporation, Chainyard, & Trust Your Supplier, who has been making a name for herself in the technology, staffing, and services industries. With 23 years of experience in the staffing and services industry and her desire to provide an end-to-end solution for her customers, Sri was moved to co-found Trust Your Supplier. Her motivation to become a leader stemmed from two female trailblazers, Indira Gandhi and Jayalalithaa, who played a significant role in shaping the future state of India. From a business perspective, Indra Nooyi, PepsiCo’s former CEO, and chairperson is Sri’s inspiration.
Apart from being a co-founder, Sri also plays multiple roles in the organizations she leads. As a CFO, she manages financial activities and ensures the balance sheet lines up. As a President, she is responsible for board meetings, compliance with state and federal laws, and managing certificationsfrom organizations such as WBENC and NMSDC. In addition to all this, she also manages the staffing side of the business, Workforce Solutions, and keeps the recruitment team on their toes.
The most significant obstacle Sri has faced in her career is proving herself to get the respect she (and all women) deserve. She noted that women must do more to get the same respect as men with the same title. But Sri’s persistence, ability to not take things personally, and work with trusted partners have helped her succeed.
Sri’s advice to women who aspire to become leaders is simple: follow your dreams, be decisive, and don’t be afraid to make tough decisions. Sometimes conversations and decisions are tough, but we’re tougher.
Let’s continue celebrating women’s history month by empowering and inspiring women to be anything and everything they want.
In 2023, women are defying expectations and shattering glass ceilings 👏 every 👏 single 👏 day. And Michelle Armstrong is a prime example of this. Michelle, who hails from Ireland, has been named Chief Relationship Officer at Trust Your Supplier, a position that requires her to excel in building strong relationships with clients, colleagues, and partners. And excel she most certainly does.
When you meet Michelle, it’s easy to see why she was chosen for this role. Her kind and intuitive nature makes her an expert in understanding and connecting with others. Her ability to know the minute details of all her customers’ schedules is a testament to her excellent organizational skills and attention to detail. It’s no wonder she’s been so successful in building strong relationships with people from all walks of life.
At Trust Your Supplier, Michelle leverages her exemplary change management skillset to analyze issues, devise continuous process improvements, and incorporate business process initiatives to increase efficiency and streamline operations. She excels in building strong relationships with clients and third-party vendors and is highly skilled in translating their business needs into key features for our product development team.
But Michelle’s success is not just about her skills and experience. It’s also about her determination and resilience in the face of adversity. She grew up in a society that expected women to marry farmers and take care of the home. Yet, she refused to be held back by these expectations and chose to follow her own path, which has taken her all over the world.
Michelle’s appointment as Chief Relationship Officer is a win for all women striving to break normative boundaries and succeed in their chosen fields. Michelle is a role model for women everywhere, showing that it’s possible to have a successful career while also prioritizing family and personal relationships.
Despite her busy schedule, Michelle has been married to her husband for 30 years and has gracefully raised strong, independent, and humble children while traveling around the globe. She embodies the idea that balancing personal and professional life is possible while excelling in both.
In a world where women are still fighting for equality, Michelle’s success is a shining example of what’s possible. She proves that with determination, resilience, and a willingness to break through societal expectations, women can achieve anything they set their minds to. We can’t wait to see what she’ll accomplish next.
Last week was one of the more interesting ones on the social media circuit, e.g., LinkedIn.
To start, a post referencing Dirk Spijkers raised an interesting debate regarding technology and partnerships. According to Spijkers, “at a high level, you must do more than provide great technology,” although great technology is still important. However, beyond the technology, you also “need to become a trusted “expert” partner who understands procurement organisations’ challenges across the enterprise and beyond.”
In my comment to that post, I said I would write an article about “breaking down the functional silos that limit the ability of internal and external stakeholders to work collectively toward a mutually beneficial outcome.” Today’s post is the fulfilment of that promise. I will also discuss the “critical role that a service provider will play in facilitating this collaboration to ensure seamless integration and user adoption.
The “Right” Skills
According to an August 2022 CIPS report, success in breaking down silos is directly linked to an organisation’s effectiveness at “facilitating collaboration to ensure seamless integration and user adoption” of new technologies. In short, and as intuitively user-friendly and effective digital tech – including AI is today, it still requires people with the right skills to work collaboratively toward a mutually beneficial result.
The report’s skills included “communication, internal stakeholder management, influencing, supplier relationship management, and negotiation.”
While the above observations sound entirely reasonable, a Deloitte Global Survey of CPOs indicates that a significant gap between recognition and realisation of skills still exists. The survey’s findings suggest that most CPOs are dissatisfied with the progress and results of their digital transformation strategies.
You may be wondering where I am going with this track. I will now come to the point. No matter how great the technology, digital success is built on the foundation of an organisation’s “digital readiness.” The core component of digital readiness means having the right talent and skills to communicate and collaborate with internal and external stakeholders. The collective and proactive application of these skills breaks down silos and paves the way for digital transformation success.
A Degree For Success
Several studies and corresponding articles indicate that in the five years leading up to the pandemic, many CPOs did not believe their existing teams possessed the necessary skills to deliver their strategic objectives. As I thought about these findings – which were somewhat surprising, a post by Iain Campbell-Mckenna caught my attention.
The post “Procurement’s Conscious Degree Bias” lamented the profession’s continuing practice of screening job candidates using a university or college degree as the proverbial “golden ticket” to get their foot in the door. How important is a candidate’s degree pedigree for choosing the next great hire? To what degree (excuse the pun) is having a diploma a predictor of success? Based on CPOs’ views of their team’s capabilities, prioritising education isn’t working.
The message from a growing number of procurement industry experts and executives is becoming clear. Organisations need a team with the “right skills” to successfully break down the silos to achieve the level of digital readiness that leads to success.
Partner Skill and Experience Is Also Key
So, why am I talking about end-user skills as a solution provider?
Because when you are selecting a digital transformation partner, you have to look beyond the great technology to find the right skills, experience, and expertise to turn the digital promise into a digital success reality.
In a future post, I will talk about how you can assess a service provider’s technology and industry knowledge to optimise your success by leveraging advanced intelligent solutions.
We are thrilled to introduce our new Senior Vice President (SVP) of Global Marketing, Stephanie Werner, MBA, PCM®, CDMP, who has joined our team at Trust Your Supplier. Stephanie is a seasoned professional with extensive experience in marketing strategy and execution, brand management, demand generation, and product positioning.
Stephanie brings a wealth of knowledge and expertise to our organization, having worked for nearly 20 years in various leadership roles in marketing and communications across multiple industries. She has a proven track record of driving growth, increasing market share, and building high-performance teams.
“I am beyond excited to join the incredible Trust Your Supplier team. I am eager to spearhead the development and implementation of our global marketing strategy. I get to support the growth of this amazing organization and launch new solutions to meet the evolving needs of our customers. I am truly grateful for this opportunity and can’t wait to work alongside such a fantastic team.”~Stephanie Werner
Please join us in welcoming Stephanie to our team. We are so excited to have her on board and look forward to working with her to drive further growth and success for our organization.
Inflation is a hot topic, and of course, outside of my personal wallet, my procurement background means that I usually view inflation/shrinkflation through a supply chain lens – more specifically, relationships and visibility.
For example, Dawn Tiura’s recent article on the introduction of a “grocery conduct code” was worthwhile reading for several reasons.
To start, citing the inflation battle between a large grocery retailer and Frito-Lay explains why price hikes are happening and why the manufacturer pulled some of my favorite snacks from the grocer’s shelves. By the way, some consumers have benefited from the situation because they discovered that alternative boutique brands were tastier and easier on the budget—more savings in their wallets.
That said, according to reports, by “providing clarity for business practices and establishing guiding principles” to “improve industry relationships” across supply chains, this new code will “ultimately benefit consumers as well.”
Of course, the code alone will not improve supply chain visibility resulting in a mutually positive buyer-supplier result. Companies will have to leverage real-time digital capabilities to assess market conditions and potential price hikes to allow them to collaborate on a solution with suppliers before it gets to the point of a loggerhead.
A State of Ready Visibility
The conduct code, or any legislative intervention, can be positive, especially when it “motivates” organizations to examine the state of their extended supply chains. I emphasize the words “extended supply chains.”
Not surprisingly, there is usually a greater familiarity and a much better understanding of the relationship with tier-one suppliers. These relationships can still be challenging, e.g., the retail grocer and Frito-Lay example from Dawn’s article.
What stood out to me from that example was the grocer’s ability to quickly tap into their second and possibly third-tier network to fill their empty shelves with quality product alternatives when their primary supplier stopped shipping their product.
It is clear that the retailer’s ability to engage their extended supply chain partners occurred long before the impasse with their leading supplier came to a head.
Here is the question: If you were to find yourself in the same position as the grocer, how quickly would you be able to identify and engage your next-tier suppliers? What is your state of ready visibility?
Extended Visibility by the Numbers
According to McKinsey, many organizations wouldn’t be able to respond to disruption by inflation or otherwise as quickly as they would need to or would want. Only 21 percent of companies have “visibility beyond their tier-one suppliers,” with only 2 percent having sufficient insight to engage their tier-three suppliers on short notice effectively.
Regardless of whether you are contending with inflation or geopolitical instability, or any other possible or probable supply chain challenge having complete line-of-site visibility throughout all tiers of your extended supply network is a state of readiness you should always want to achieve.
Trust Your Supplier VP of Advisory Practice
“Rowing harder doesn’t help if the boat is headed in the wrong direction.” -Kenichi Ohmae
Our Trust Your Supplier (TYS) platform doesn’t remain static. Data, market conditions, and new regulations are constantly in flux, which means the information our customers need invariably changes on a regular basis.
With a distinct ability to anticipate and scan the global environment for signals of change, Shyam Adivi serves as our Director of Product Strategy and Solutions. As a strategic leader, Shyam engages with our customers and partners to determine the direction of TYS’s roadmap.
Shyam’s strategy around features, timings, and offerings is often influenced by external occasions and regulations that affect procurement, supply chain, risk and compliance management, and digital transformation.
With these insights, Shyam aligns our customers’ needs with a streamlined development process. The results are an agile, innovative platform that provides continuous value and business results for our customers and partners.