IF CHUCK NORRIS WAS YOUR CPO

Perhaps I owe you an explanation of my thought process prior to moving further. My work colleague, Brendan, sent me the above picture of Hollywood Icon, Chuck Norris, with two thumbs up after reading my previous article entitled “Chasing Waterfalls, Not Unicorns – An AI Story.”

I appreciated the kind gesture. To see one of my boyhood action heroes providing his trademark signal of approval detoured my work-face to a youthful grin. Then, after a second of odd cerebration, I pondered to myself: what if Mr. Norris was CPO at one of Canada’s largest enterprises and he was staring at me across the boardroom table? 

My initial thought was I would be the recipient of a round-house kick, but that was replaced by a domino effect of business related inquisitions: What would Chuck’s position be on digitally transforming his procurement operations? What would his vision be? What goals would he wish to achieve as he digitally transforms procurement? Lastly, how would Chuck interpret today’s market trends and technology? The latter is especially interesting to me as Chuck Norris’ recent revival surged through technology – millions of viral memes and euphemisms shared over the word-wide-web.

I set forth on a journey to find out through interpretation of quotes to gain further clarity. Researching online, I received both insight and entertainment while seeking validation that he and I would be aligned. Enjoy the playful scenarios as we venture down the serious path of decision points today’s CPOs embrace as they strive towards their 2020 procurement transformation targets.

?

 IMPROVE USE OF TECHNOLOGY:

 CHUCK SAYS: “People need to realize what real happiness and success is, because success as an actor is fleeting. You can be up there one day and gone the next.”

I agree with you, Chuck – today is the day of data and disruption! Up one day and gone the next…look no further than the damage Netflix did to Blockbuster, iTunes to Tower Records, Uber to Taxi Companies - I think you get the picture. 

Accenture CEO, Pierre Nanterme, famously stated “Digital is the main reason just over half of the companies on the Fortune 500 have disappeared since 2000.”  It is clear as mud that if you do not keep on top of emerging technology, it will surely leave you under the rubber as it drives over you. 

Algorithms hide under the blanket of society in almost every way we operate today. Hidden by tiny math cubes, they leverage big data and investments in Artificial Intelligence (AI) to transform our businesses quicker than most can keep up. Whether it is our social media, our shopping, flying, work – you name it. In fact, by 2025, the AI software market will grow almost thirty-fold to over $80 billion in annual revenues. Our world is rapidly advancing and with it, business technology applications.

If historical data is indicative of future trends, a study by Information-Age.com that surveyed 500 Global C-Level Executives should open a few eyes. According to the sample, two-thirds of those surveyed believe that in the next ten years, 40% of Fortune 500 companies won’t be around thanks to digital disruption.

To apply emphasis, I must digress from Sir Chuck Norris for a moment and onto the words of Sir Winston Churchill - “Those who fail to learn from history are doomed to repeat it.”

Don’t be ‘that guy’; “No, we will not investigate or leverage new technologies” or “I think we are ok” have been some famous people’s infamous last words…

CHUCK SAYS: “I've always found that anything worth achieving will always have obstacles in the way and you've got to have that drive and determination to overcome those obstacles on route to whatever it is that you want to accomplish.”

Right again, Chuck; digital procurement transformation certainly has its share of obstacles. The first is making the decision, the second is acting on it! Thought and planning are critical, as a 2015 study by McKinsey states that approximately 70% of transformations fail.

Here are some things to think about as you begin to leverage technology to make your mark as CPO:

1. Set your ambition of where your procurement business is going – where the value is migrating. Understand where you need to be in the future.
2.  Create a plan for digital transformation – and who will lead it?  

Expertise in procurement is sometimes hard to come by. Leverage the right personnel and plan meticulously. Businesses don’t plan to fail, they fail to plan.

3. Identify how you will engage and sell a digital procurement transformation to internal stakeholders.

It would be helpful to include an agile or collaborative approach internally. Some technology will not work for organizations, so it is important to work together to present key requirements prior to selection of a solution. 

We often see one person with a vision of using what they ‘want’, and the results are negative. “Contempt prior to investigation” is not wise – do the research on what your organization ‘needs’.

4. Differentiate with the best technology for your organization. Choose implementation partners wisely!

Today, CPOs are looking to leverage a single, intuitive, best-in class-S2P platform solution. Why? User Experience (not User Interface – completely different). Adoption and success are driven by the capabilities and end-to-end functionalities of a solution. 

Pretty colors, ‘diet coke’ AI and irrelevant simplifications demoed to you are warning signs – in the words of Chuck Norris, walk away from ‘sugary choices’…conduct proper diligence to see what details made for successful projects in your sized industry.

 5. “Everyone Has a Plan Until They Get Punched in the Mouth” – Mike Tyson

This is a quote that Chuck may agree with. Deviations and problems can occur once your project lifts off. It is imperative to have a ongoing governance and check points with the executive team once an implementation is underway.

6. Allocate budget and resources dynamically – be accountable! A typical roadblock to a viable transformation is following the ‘annual’ budget cycle. As a transformation gets underway, the finances and budget should be shrunken down to quarterly or monthly cycles. This can help support a quick and effective project and account for changes to the timeline or budget.

 CPOs today are interested in leveraging technology to: (1) be proactive in protecting against disruption; (2) increase automation; (3) evaluating supplier performance & risks; (4) generating stronger supply chain collaboration; (5) keeping up with consumer demands; and (6) generating overall efficiencies and savings within their organizations.

IMPROVE COLLABORATION WITH BUSINESS & SUPPLIERS:

CHUCK SAYS: “I think setting a goal, getting a visual image of what it is you want. You've got to see what it is you want to achieve before you can pursue it.”

Chuck knows a thing or two about working in a process with his team to achieve top results. Evidenced by his Walker: Texas Ranger squad, Norris collaborated effectively with Law Partner, Jimmy Trivette (Clarence Gilyard) and Assistant District Attorney, Alex Cahill (Sheree J. Wilson). Together they would analyze, plan and pursue justice; perhaps reconciling their work over a few cold ones to ensure facts were correctly matched.

Today in procurement, there are many negative forces at work in businesses. The savior in this unpredictable time is data. Big data, in particular, are extremely large sets of data that are hard to derive outcomes without technology or a strategic partner. Big data also drives various forms of artificial intelligence such as Machine Learning. What data can offer is analysis. Analysis can offer a vision, derive opportunities and strategy. Strategy is planned and executed by collaborating internally and externally. CPOs are centered on supplier relationships and performance today, especially as they look to sharpen supply chains. 

Manufacturing companies may focus on collaboration between departments as they are essential to reducing manufacturing cycle times and forecasting raw material prices, inventory and risk. Engineering, Finance, Procurement and Manufacturing departments should be collaborative and work together to achieve more efficiency and drive business value. 

Supply chain collaboration and strategic procurement are on the 2018 CPO list of priorities for most companies as they construct increased profit margins and reliability. Collaboration with suppliers can result in co-innovation, less stock outs, quicker time to market, better risk mitigation and reduced COGS. A company’s reputation and sustainability hinges on how fast they can adapt to consumer demands and bring goods and services to market (with the lowest risk and highest margins). The right technology will lay the foundation to keep your company aligned with customer and industry trends; therefore, lowering probability of unforeseen circumstances.

 

IMPROVE STAKEHOLDER COMMUNICATION:

 CHUCK SAYS: “Let's face it: so much of what we consume is not driven by knowledge but by basic craving and impulse.”

Absolutely, Chuck! I can act similarly when I am driven to complete my individual tasks. Having tunnel vision may be efficient in some instances, but not necessarily in the best interest of the team or company you are working with. One of today’s biggest problems in our personal and corporate lives is a lack of effective communication. When effective communication is utilized, the bigger picture is more visible, and results magnify.

Procurement teams are often accused of focusing on savings goals, being gatekeepers, suppressing creativity and damaging the reputation of the company with mismanaging inventory through stock outs and delays. How does procurement shift this paradigm?

1.  Know Your Business Drivers

Think of your procurement organization as a service provider for your company. Internal relationships should be managed as though you are dealing with customers. To better manage cross-functional relationships, a joint understanding of each department’s objectives is required. You should understand what drives value for each team and what ‘good’ looks like in each part of the business.

 2. Move Away from the Cost Savings Stigma

Traditionally, KPI’s for procurement have been measured on cost savings alone. Work with stakeholders to increase the visibility and scope of procurement operations by thinking forward. Having a person dedicated to keeping up with innovations that can bring value outside of sourced savings is a good idea. Technology, Risk, Supplier Collaboration, etc., are a few areas where value can be realized and expressed with effective internal communication and planning.

3. Internal Stakeholders Should Improve Engagement

The number one reason identified by Xchanging Procurement for business targets not being met is the ‘lack of internal engagement.’ Furthermore, from XP, over 65% of high-ranking procurement professionals surveyed worldwide cite ‘internal stakeholder engagement’ as a challenge. It is vital to learn the language of your peers and engage frequently through meetings, forums, one-on-one discussions, etc. to be able to add bi-directional input and value. In short: work and learn together!

As a CPO, it is imperative that the engagement of the procurement business aligns with the end goal of the business – driving value and profit. Technology supports this collaboration in many ways. It allows for accurate data reports that can help identify additional value drivers. Rationalizing disparate systems, applying automation, reducing redundancy in day-to-day tasks will allow your stakeholders to build strategy as a team.

 

IMPLEMENT STRONGER POLICIES & PROCESSES:

CHUCK SAYS: “A small behavioral change can also lead to embracing a wider checklist of healthier choices.”

Wise words, from a wise man. Changing organizational behaviour is one way to lead to healthier operations. Structure is vital in any formal organization. With procurement being a relatively ‘new’ department and only now receiving just attention (Don’t believe me? Try googling CPO…you won’t find as much as you think),it is an opportunity to get policies and processes right and take a competitive advantage.

Only over the last few years have colleges and universities started to offer streamlined procurement programs and course offerings. This shows the value that procurement and supply chain effectiveness is bringing to the world. Any forward-thinking company knows this is where the sustenance will reside.

CPOs should be leveraging consulting and technology partners to evaluate their operations and follow through. There are numerous examples where twocompanies (same industry), bought the same technology, but two different integration partners. The results in this case are one happy customer and one not so happy customer…why? Seasoned CPOs’ know lowest TCO does not equal the lowest price. Focus on the TRIANGLE OF SUCCESS (People/Processes/Technology) is of utmost importance. You can miss any one side of the triangle and it can make the difference between success and failure.

Companies like SAP have supported their clients continuously from the planning phase right through to value realization after implementation. Lock into a strong long-term strategic technology partnership with a company that will be around in ten years.

 

IMPROVE STAFF CAPABILITIES:

CHUCK SAYS: “Whatever luck I had, I made. I was never a natural athlete, but I paid my dues in sweat and concentration and took the time necessary to learn karate and become world champion.”

Chuck Norris worked hard to be a World Karate Champion. In fact, he lost ten times in numerous years before avenging his last loss to become champion – a title he held for six consecutive years. To learn from his mistakes, the tournament competitors’ moves, and his study of his craft would be like CPOs and other executives today. Businesses require a similar work ethic to succeed with their teams.

Procurement has only recently received the attention it had craved over the past few decades. Many folks working in this department did not go to school for procurement but learned the trade onsite. In essence, they did not pick procurement – procurement picked them. Therefore, highly successful and knowledgeable procurement professionals are in-demand.

With your typical supply chain management employee responsible for $24 million of procurement, it is certainly a high stakes game and professional procurement practice is imperative.

According to Ardent:

“To be successful in 2018, CPOs must ensure that their teams are intelligent and are able to ‘acquire and apply knowledge and skills’ in each of these key areas. And to be intelligent, the prototypical procurement department needs to prioritize data science and analytics capabilities among its staff; process standardization, linkage, and automation; the adoption of modern source-to-settle solutions (taking either the “big bang” approach or an incremental approach), the establishment and centralization of procurement best practices; and the tireless, endless management of performance among the staff and the supplier base.”

Continuous adaptation and process improvement combined with hiring and developing top talent which will make your organization develop a competitive advantage. Leveraging top talent with ‘intelligent’ technology, a best-in-class end-to-end S2P platform and simplified user experience makes for an effective and efficient operation driven by strategic planning.

 

POTENTIAL ADVICE FROM CHUCK TO OTHER CPO’S:

CHUCK SAYS: “I've got a bulletin for you, folks. I am no superman. I realize that now, but I didn't always.”

 What I would like to believe is Chuck telling the procurement leaders of the world to revisit their vision and three-year technology planning. Digitally transforming source-to-pay operations and creating collaborative supply chains are essential to surviving this era. If a CPO is hesitant or resistant, it could very well be one decision they could go on to regret. Stay ahead of industry competitors and protect your market share by using technology to predict consumer demands and time to market.

CHUCK’S FINAL WORDS:

As we say goodbye, I wish you well on your digital transformation journey and leave you with a final quote of inspiration:

 CHUCK SAYS: “A lot of times people look at the negative side of what they feel they can't do. I always look on the positive side of what I can do.”

Think positive…Think forward…Think ‘INTELLIGENT’ PROCUREMENT!!!   

 

-Chuck Norris neither participated or endorsed this article

-Chuck Norris pictures courtesy of google images