Each day for the next seven days I will be posting parts 1 through 7 from what is considered to be one of the most popular series in the Procurement Insights Blog’s history.
The Dangerous Supply Chain Myths series was based on my review of the ISM, CAPS and A.T. Kearney Report that was originally released in May 2007.
Considered to be a breakthrough assessment of the purchasing industry at the time, I felt that there were several gaps in the study. What is important, and within the context of present day realities, what do you think. Do the key areas highlighted in the study still carry weight in the here and now? If not, what has superseded them in terms of overall importance?
Missed a previous post? Use the following link to access the entire 7-Part Series.
Segment 5 – Talent Attraction and Retention: An Exercise in Platitudes?
- Talent Attraction & Retention
A supply chain is not an abstract network driven by processes and machines, but a real network driven by people. Good supply chains run on good people. Supply Chain Success will be impossible without the right talent, which is becoming rarer every day thanks to the global talent war. Any organization that does not have a good process in place to identify necessary skills, evaluate organizational gaps, and identify, recruit, develop, and maintain talent is doomed to become a second class citizen in the emerging international marketplace.
Talent attraction and retention begins and ends with the pre-existence of firmly established core values and a clearly defined strategy. In other words, attracting and retaining talent is not an exercise in and of it self but is the by-product of a sound procurement strategy and practice.
To be even more direct and taking a page from the world of sports good player’s want to be part of a good (re: winning) team.
As discussed in the previous segment, the majority of companies fail to establish a strong organizational foundation of understanding through effective avenues of communication. Therefore, the very same risks associated with looking to external consultants for direction exist when recruiting outside talent.
Introducing a new recruit into an environment that is found wanting in this critical area regardless of his or her individual skill level, will result in frustration and ultimate failure for both the company and the individual.
Are you a Doom Loop Company?
In his book Good to Great, Jim Collins made reference to the Doom Loop and Flywheel concepts.
In the former, corporate leadership builds their strategy based on misinformation and therefore lack a clear understanding of the real challenges their organizations’ face. They then attempt to implement an initiative which after failing to solicit feedback from key stakeholders does not receive the required buy-in. The initiative then flounders and as a result cannot gain the necessary traction to drive positive results. Before you know it, the company is back at square one. (Once again refer to the 75 to 85% rate of e-procurement initiative failure.)
Conversely, the good to great companies (the majority of whom ironically promote from within their corporate ranks versus looking to an outside source for leadership and guidance), relied on a “down-to-earth, pragmatic, committed-to-excellence process – a framework – which kept each company, its leaders, and its people on track for the long haul. This Collins asserted demonstrated the “triumph of the Flywheel Effect over the Doom Loop.” (I would strongly recommend that you obtain a copy of Collins’ book Good to Great to learn more about the Flywheel Effect as well as the other interesting results from his extensive research.)
So before you actually enter the competition for talent fray, you have to ask yourself these critical questions;
- Has my organization established the necessary channels of communication with all of its key stakeholders?
- Has my organization firmly established a solid foundation of understanding in terms of its current procurement practice (including areas of potential improvement)?
- Has my organization clearly identified a course of action that is capable of achieving its stated objectives?
- Has my organization received the necessary stakeholder buy-in to systematically achieve graduated results on a consistent basis?
If you cannot answer these questions with a confident yes, you are not ready to bring in a seasoned veteran let alone pursue a talented young prospect.
This is why the ISM, CAPS and Kearney report is problematic. They throw out superlatives such as multipronged strategies and competency maps with a key challenge being the ability for leaders to “manage and motivate” individuals across functions, geographies, cultures and generations. (Makes me wonder to whom this report is actually directed?)
Taking another page out of Collins’ book where he highlights a number of corporate myths his research found (and I quote); “Companies that make the change from good to great have no name for their transformation – and absolutely no program. They neither rant nor rave about a crisis – and they don’t manufacture one where none exists. They don’t motivate people – their people are self-motivated. There’s no evidence of a connection between money and change mastery. And fear doesn’t drive change – but it does perpetuate mediocrity.”
Collins’ research ultimately reached the conclusion that “dramatic results do not come from dramatic process – not if you want them to last, anyway.” He went on to say that “a serious revolution, one that feels like a revolution to those who are going through it, is highly unlikely to bring about a sustainable leap from being good to great.” The City of Houston’s SAP initiative comes to mind here.
Therefore, the prognostication rhetoric associated with the majority of reports as to how the future will unfold really comes down to nothing more complex than the ability to listen and understand. This is the true starting point.
By listening to the concerns and objectives of key stakeholders from both within and external to your organization, you will gain a practical, real-world understanding of the forces that influence and therefore will shape your procurement practice.
It is at the point when you understand the importance of the simple listening-understanding precept that you begin to influence the future versus having the future influence you.
I want to emphasize that I am not suggesting that papers such as the ISM, CAPS and Kearney report are devoid of value. What I am saying is that your ability to properly filter and effectively apply the information to your specific situation is the seminal point. And the only way to achieve this result is to truly understand your working environment.
And it is from within the framework of this type of environment that you will be able to identify and pursue the kind of talent that will prosper both the company and the individual. And this is ultimately the best way to attract and keep top notch talent.
(Next Installment: Enablement of the Supply Management Organization)
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