Digital Roadmap Series: Re-imagine the Process

Happy Kentucky Derby Day, everyone!!  Currently, I am sitting in the Las Vegas airport waiting for my extremely early flight to Nashville.   Why Nashville?  ISM 2018 is kicking off tomorrow.  Anyone else going?  If so, please connect with me.  Would love to catch up.

Ok, to onto step three.  Just to recap where we are.  In step 1, we created the problem statement and step 2, we created the actual process and identified opportunities with that process.  You should have the problem statement and the listing of opportunities up on the wall for the step 3. 

For this session, plan on another 4 hours and have the same group get back together.  This session is typically the most challenging one, as we are asking people to let go of the constraints we “have” today.  We are also going to ask them to let go of what has not worked in the past or the technology that they lack. 

To get started, place a big blank piece of paper on the wall.  It needs to be big enough to draw out your newly imagined process.  The idea here is that you, with this new process, fix the opportunities identified in the last step.  Therefore, draw the process which includes such things as:

• What if you could automate a process?
• Where could you have better data available?
• What process steps maybe are not needed anymore?
• What if you had workflow?
• What if you had a different organizational structure?
• What if you had different capabilities on the team?

Draw this wonderful process on the piece of paper on the wall.  This will take some time to do, and writing it like I did, makes it sound overly simple.  It will take a strong facilitator to keep the group unconstrained.     

Once you have it documented, jot down what investments are needed to make this happen.  For instance, it might be:

•      We need to invest in RPA.
•         We require better data visualization.
•         We need to reskill our organization with “X” skills.
•         We have to create “Y” team.
•         We need a chat bot.

The fantastic part about this approach is that you will know exactly where you would like to apply/implement these investments and the value they could deliver.

As an output of this session, have someone document the newly imagined process flow and the listing of investments that are needed for the process to work. 

And that is it for step 3.  The last step to developing your digital roadmap is to take the opportunities and investments needed and prioritize them.  There are several ways to do this so I will be giving you some options next week.

Go shine on this week and I hope to connect with you at ISM.  

Are You Ready To Lead a Digital Transformation?

Hello strangers.  It has been awhile since my last posting.   I have been on quite the adventure over the last year at work and at home (all great things, but took my focus).  However, I feel like I have my blogging mojo back and I have time to dedicate. 

With that said, I had an amazing experience at Generis’ Supply Chain Summit in Dallas, TX earlier this week.  The presenters were mostly practitioners with a subtle mix of suppliers. It was great to hear the up and coming trends, what companies are already doing, and having the opportunity to meet so many talented people is always a great motivator. 

At the conference, I had the opportunity to present on a lot of the concepts that I have written about on this blog (video will be available soon, but if you do not know the concepts, please read the historical posts), with a particular focus on Sourcing Acceleration and the type of talent we need in Procurement to meet the consumer centric, individualized Supply Chain needs of the future. (Note - for some the future is very much now). 

In order to meet those needs, we have the perfect opportunity to get on the digital bandwagon.  95% of respondents in a recent Hackett study said that digitalization will drastically change Procurement in the next 2-3 years.  So, do you have a strategy to apply machine learning to make recommendations for you?  Do you have a pilot for RPA to automate your Sourcing processes?  Do you have an RFP scenario optimizer?  Have you thought of how to get data on demand for all decisions that are being made by your Sourcing team?  Do you believe that a simple sourcing event could take seconds and a complex one under 4 weeks?  What if you had a potential supplier database at your fingertips? 

Did I just overwhelm you?  Sorry.  You want some good news?  Unlike the trends of the past, you do not need to invest tons of money in this.  I do not even believe you need a slew of consultants to tell you what to do to make this happen.  And, you can move pretty quickly, as these solutions are fairly simple to implement (get that ERP implementation out of your head…).

Because I believe in Procurement so much and that we can make this happen TOGETHER, I would like to share in my upcoming posts about a) how to develop your digital roadmap and b) a suggestion around how to implement the changes, while getting engagement from your teams to drive the change. 

The concepts that I will share, I have learned through the several transformations that I have lived through and/or led.  Unlike blockchain, 3D printing, machine learning, these concepts that I will be sharing are not new but can be applied to this need. 

If you are in, please follow the updates in the coming weeks on Saturday mornings and share with a friend.  It would be my wish for all of you to be digital rockstars for your company by the end of the year.   

The Era of Disruption

I had the pleasure of attending and speaking at ISM Tech 2017 this past week.  It was one of the most forward thinking conferences I have attended in awhile.  From discussions on 3D printing, to drones that help with inventory management, my mind was blown with all of the innovation and advancements that are poised to completely change how we think of supply chains and deliver on customized solutions for the customer base.

Much like how Amazon disrupted the retail world and how Uber changed the game in delivery (people and product), we are at the cusp of some major advancements in Supply Chain and Procurement.   Let's take 3D Printing, as an example.  Rick Smith, CEO, from FastRadius described how 3D Printing IS changing how we think of inventory.  Inventory is no longer physical, it is digital.  It is changing the design cycle.  No longer do you need to have lengthly designs and protoyping and all the costs associated.  With 3D printing, you are designing as you are producing.  It changes where you produce, as you can produce close to customers than ever before.  It also changes how much you produce at one time, as everything can be on demand.  Therefore, the cost model is completely different.  No longer are we looking at larger purchases to drive down costs or MOQ discussions.  Lastly, and might be the most important, 3D Printing allows for customization based on specific customer needs or requests.  A current example is 3D printed knee replacements.  Due to the technology, the knee replacement can be customized to the individual receiving the replacement and it also can have pain relieving drugs inside the replacement itself.  My mind starts wondering about all the possibilities this could have.  Gone are the days of mass production to an average requirement.

Another topic was on robotics.  I spoke on RPA, which is already changing the way we look at end to end integration and process automation.  However, there was also a great conversation on physical robots, in this case drones, that are helping with asset management and inventory outside and inside buildings.  The thought process here is to have a drone count assets/inventory for you.  They can perform it so rapidly that gone could be the days of cycle counting, as they can count the entire warehouse/DC daily if you wanted.  PINC, known for their yard management expertise and software, is driving this innovation.

A couple of items that were not talked about at length, but are relevant none the less, are how these changes impact human capital/how we can start planning for it now and how we are living also in a unstable geo-political atmosphere. After reading several overviews of the Procurement environment in 2017, tit was clear that there is a high level of uncertainty around populism, trade changes, and how this could impact global markets.   There is also a general lag in human capital capability building, within businesses and within our schooling systems, to get ready for such a disruptive change.

So, the question is with the state of the Procurement functions today, are we ready for such an Era of Disruption?  Who will see this as a large opportunity to leap frog the competition?  Or will Procurement be overrun by such changes?   The amazing thing to me is that if you are not having conversations now about these changes, you are already behind.  These changes are already occurring and they are not waiting for anyone.   It is time now to be a disruptor!  

Mysterious Robotic Process Automation

Happy Halloween everyone!  What a better topic to talk about to get yourself in the mood than robotics?  Those scary, eerie, mysterious bots...

Unlike the picture above, we are not talking about physical robots.  We are talking about robotic process automation or RPA for short.  Have you heard about this?  My advice for you - get educated and get ready for RPA, if you have not already.  It is wicked - in a good way!

What is RPA?  
The easiest way to explain RPA is like a slightly more sophisticated macro.  It is a software program that you "tell" to do repeatable, high volume, logic or rule based steps that are performed in a system.  And when I say "tell", you are really recording the steps within the software so it can repeat those same steps over and over again without much human intervention.

Why is it Wicked?
Most of us have found macros to be a huge help to our organizations.  In fact, when we hire talent, we sometimes ask if they can write macros because we find so much value in those skills.  RPA removes the limits because you can use these robots on any system.  Think highly transactional, repeatable processes within Procurement or AP that are performed in a system.  Those could be recorded so the bots can perform repeatable tasks, so teams can focus on more value added tasks.

Bots do not take vacations.  They do not get sick.  They work all hours of the day.  They are super productive.  I have heard that 1 bot is equal to 3-5 traditional FTEs.  They also do not commit fraud, forget steps in the process, or try to avoid the correct, standard process.

And, they are somewhat cheap compared to a fully loaded headcount.

Feeling a little freaked out?
The first time I was introduced to RPA, I was freaked out.  This is a game changer.  It changes how we think about talent, for we need to start thinking about managers who are capable of managing bots.  They need to know the process, how to train them, and how to manage the quality of the results.  We also have to think about how to train and build capability for talent performing the repeatable tasks today because they will be shift to more value added tasks.

It changes how we make decisions about transforming our organizations.  Does it change if we should outsource?  Does it change the need for large scale ERP implementations?  Does it change how we integrate systems together?  The great thing about RPA is that you can apply it even if you are not on a ERP, even if you are not considered world class in your processes.  If applied correctly, your organization could leap frog quickly with much less investment.

They are still eerie to most.
There will be several people that are scared about this change.  There are real concerns about this functionality.  IT security is going to need to get onboard related to the risks and controls in place.  For instance, what protections are there from hacks?  A hacked bot could do a good amount of damage.  Internal Controls / Internal Audit will also need to get onboard with the amount of controls in place and that what you tell the bot to do is correct.

Lastly, Procurement and AP leadership, above all else, will need to get onboard.  Given this has such game changing potential, we might get in our own way (remember we naturally like our comfortable existence.)  I truly hope that more and more unicorns consider the new potential to transform their processes and organizations through using RPA.

Ready to be scarily awesome?
If you are geeked out about this, there are things to start working on to prepare for this change:

• Document what is actually occurring today in these repeatable processes.  It is important to be as accurate and detailed as possible when documenting these processes.   This will help determine where to apply the bots and how to tell them what to do.  
• Build your business case.  The business case could be about reducing headcount - but that is a small part of the opportunity.  Think about what you could get after as a result of the RPA implementation.  For instance, could you gain more discounts because your processes are more efficient?  Could you drive more spend under management because of the implementation?  What are the results of what your team can do for the company because of this new technology?
• Think about the process and organization to support this change.  As you might know already about me, technology is only the enabler.  If you do not have the process and organization to support the tech, you are not going to get very far.  It is time to start thinking about how you would perform QA, do you need bot managers, how do you audit the processes that the bots are supporting?

Anyone now dressing up as a robot on Monday??  Again, Happy Halloween and enjoy the possibilities!