Sunday, October 25, 2020

Business Consulting Wows!

 

Get your own personal business consultant! Dr. Tom DePaoli’s new book


Business Consulting Wows! Desktop Guide to Help Run Your Business reveals all the Wow! discoveries of his career. The book serves as an outstanding business desktop guide for growing the respect and trust of your colleagues. Benefit from his compelling and entertaining business advice! He organizes the ideas by his eight successful business books topics. They include blogs, articles, reviews and real-life experiences. He calls these extra cuts. He uses techniques like story-telling, imaginative training exercises, check lists, methodologies, humor, and ready to use outlines.  Areas covered are purchasing, procurement, the supply chain, work process-design improvement, human resources, lean, emotional intelligence, lean six sigma, kaizens, organizational transformation, business fables, and most importantly leadership. The reader can gain much from these lessons.  An index is provided to guide the reader to the articles that interest them.  He recommends not to read the book from front to back. First check out the index, and read what interests you. Dr. DePaoli’s lessons are practical, to the point and enjoyable.  Like many good business leaders, the author places getting the trust of employees first and foremost in his book. The book provides solid elements of a desktop guide for success in business. Dr. DePaoli asserts, “You can learn from my experiences and achieve even greater success.”

 

Contact Dr. Tom = thomasdepaoli@yahoo.com drtombooks.com for newsletter sign up https://drtombooks.com/contact/ My Books link: https://www.amazon.com/Tom-DePaoli/e/B003XSV1IQ

Wednesday, October 21, 2020

The Role of Emotional Intelligence in Negotiations by Tom DePaoli

 

Negotiations

The Role of Emotional Intelligence in Negotiations by Tom DePaoli

Procurement and supply chain professionals must be aware of and strive to improve their emotional intelligence. It has a key impact in negotiations. Soft skills are becoming more important - even in the digital age. A definition of emotional intelligence is the capacity to be aware of, control, and express one's emotions, and to handle interpersonal relationships judiciously and empathetically. Some would say that emotional intelligence is the key to both personal and professional success.

My Story on One Method of Improving Your Emotional Intelligence

I improved my emotional intelligence by interviewing thousands of people over my career. As a former human resource professional, talent management is the key success factor. I strived to put people at ease and understand their motivations, fears, and emotions during the interview process. I tried to find some common interest or experience to alleviate the tension. More often than not, this happened.  Reading people is a great skill to help improve collaboration and mutual goal setting. I strongly recommend procurement and supply chain professionals increase their socializations and direct face to face contact with colleagues, suppliers, and customers. It gives you the advantage of observing body language and facial expressions. In our profession, it is about relationship building. Unfortunately, the digital age limits this type of contact, but I urge professionals to try to overcome this current state.

Emotional intelligence is especially critical in negotiations. I classify three main types of negotiations and I will try to discuss the importance of emotional intelligence skills in each type.

The three types of negotiations strategies that are generally recognized are:

1.     Adversarial (or the win-lose approach)

2.     Win-Win, where both parties win on certain issues or concerns

3.     Information-based negotiations, where a deep understanding is obtained by both parties and often a strategic partnership can evolve

 

The adversarial approach requires some emotional intelligence but often degenerates into a shouting contest with great histrionics, intimidation, and a brutal battle of wills. Since both parties are often acting, exaggerating, and pushing their own agenda, relationship building or empathy takes a back seat to just one party getting its way or out-bullying the other. The emotional intelligence skills required are very low or non-existent.

 

The Win-Win approach starts with a discussion of the respective parties wants and needs. The goal is a mutually satisfying agreement. People are separated from the problems; a variety of possibilities are created, and the results are based on some objective standard. There is a fairly strong commitment to empathy and no blaming is allowed. Both parties are involved in problem solving and there is a focus on each party’s interests. The focus is then redirected to mutual interests or common ground. The objective is to be trustworthy but not totally trusting. This approach requires a moderate level of emotional intelligence skills from the procurement professional or negotiator.

An information-based negotiation is a radically different approach. It emphasizes deep knowledge of the second party, usually the supplier and their industry. It transgresses from some traditional approaches to negotiations but in information-based negotiations the procurement professional gains a deep understanding of the supplier’s industry, their margins, and their culture. In essence, this is an immersion or empathy with the supplier and their competitive landscape. The best way to describe it is that the procurement professional knows as much or more about the supplier and their industry as they do!

Some would argue that this approach is highly analytical. Information drives decisions rather than emotions or one-upmanship.  However, the procurement professional becomes highly tuned emotionally with the supplier.  A deep and mutual understanding of their competition, margins, challenges, and constraints is mastered. Trust issues are quickly overcome and resolved. Trust becomes nearly total. It requires the procurement professional to become the resident expert on a market and an industry (just like the supplier). It tends to yield much more significant long-term gains than adversarial or even win-win approaches. Using this approach is one of the best methodologies for transforming the supply chain and developing true mutual breakthroughs with your supplier. Below is a summary table:

 

Negotiation Tactic or Strategy

Degree of Emotional Intelligence Required

Adversarial

Little or none

Win-Win

Moderate

Information-Based

Deep

 

My conclusion is that procurement and supply chain professionals must not only work to develop their emotional intelligence skills, but also realize its degree of usefulness and appropriateness for each different type of negotiations tactic or strategy.

Dr. Tom DePaoli, (Dr. Tom or Captain Tom), is currently an independent management consultant, the CEO of Apollo Solutions, which does general business consulting in the human resources, supply chain and lean six sigma areas. His organization was self-founded in 1995. He retired as a Captain from the Navy Reserve. In other civilian careers, he was a supply chain and human resources executive with corporate purchasing turnaround experience and lean six sigma deployments. He has worked for over ten major companies and consulted for over fifty organizations throughout his career. Some of his consulting projects include: information systems projects, re-engineering organizations, organizational transformation, e-procurement, e-commerce, change management, leadership training, creativity improvement, global sourcing and negotiating, especially information-based negotiations. His industry experience is in the chemical, paper, DOD, pharmaceutical, IT, startup, automotive, government, consumer, equipment, business services and consulting industries. He has been published extensively in journals, magazines and books. He is the author of eleven books all available on Amazon.  He has instructed at six education facilities in numerous roles. He is active in supporting the YMCA, Wounded Warrior, and the prevention of the bullying of children.

https://www.amazon.com/author/tomdepaoli    = Dr. Tom’s Amazon author’s page

http://www.apollosolutions.us  = Website of Apollo Solutions his business

drtombooks.com  = More information on Dr. Tom’s books and writings

http://www.linkedin.com/pub/dr-thomas-depaoli/0/736/6b3/  = LinkedIn home page

https://apollosolutionsbooksandconsulting.blogspot.com/   = Dr. Tom’s blog

@DrTomDePaoli = Twitter    https://twitter.com/DrTomDePaoli

https://www.facebook.com/ApolloSolutionsConsulting = Facebook of Apollo Solutions

 

Improve your emotional intelligence. #negotiations

https://www.linkedin.com/pulse/role-emotional-intelligence-negotiations-tom-depaoli-depaoli

 

Contact Dr. Tom = thomasdepaoli@yahoo.com drtombooks.com for newsletter sign up https://drtombooks.com/contact/ My Books link: https://www.amazon.com/Tom-DePaoli/e/B003XSV1IQ

Monday, October 19, 2020

Author’s Interview With Dr. Tom DePaoli of Common Sense Supply Management

Author’s Interview With Dr. Tom DePaoli of Common Sense Supply Management


 

https://www.amazon.com/author/tomdepaoli

 

 

Why did you write the book Common Sense Supply Management?

I wrote it as a follow-up to my original book Common Sense Purchasing.  Many purchasing departments were in the process of or transforming to the supply management or the supply chain concept. I wanted to build on and refine my ideas originally expressed in Common Sense Purchasing. In addition the supply chain is the most dynamic and changing area in corporate culture. When change occurs ideas and strategy are critical.

 

You used a different approach why?

In this book, I decided to share my supply management knowledge with readers. I believe people learn more from stories and real life events than from a text­book. The stories were meant to get the reader to think about improving their supply management strategy. Some of the stories are good management lessons. In some of these tales, I was very fortuitous (lucky); others were the result of having talented people work for me and teamwork, and still others were the result of just hard work and massive amounts of homework. I wanted to enliven the discussion about the supply chain.

 

 What is your opinion or definition of the supply management?

Supply management covers more breadth and depth than any other discipline in an organization. It’s the art of building multiple relationships. Although it covers negotiations, transactions, indus­try knowledge, market knowledge, and technology, it’s primarily about building strong relationships and gaining the trust of suppli­ers, customers, and colleagues. I said it in my first book and I’ll say it again: relationship building must be the foundation of any supply management strategy. Many cultures in the world spend what seems to us Americans as an inordinate amount of time building relationships before they get to problem solving or execution. Americans are often impatient with this approach, but it’s necessary, especially when dealing with other cultures, it is a lesson we must learn when using supply management techniques.

 

What do you think a supply management professional must master?

A supply management professional must be able to build rela­tionships. Supply management departments often spend excessive amounts of money on technical training. This is fruitless unless a strong foundation of relationships is well underway. Relationships can’t be faked, legislated, or forced. Supply management profes­sionals must live relationships and commit to them. Integrity in relationships will always carry the day, impress suppliers, scare the competition, and let the supply management professional sleep well at night. Educational credentials certainly look good,

and certifications are impressive, but nothing makes a purchasing professional more effective than developing strong relationships and being true to his word. Spending more time on relationships pays off for all participants. Once a trust is broken, it’s nearly impossible to repair it, so don’t neglect your relationships or underestimate how critical they are. You won’t be able to climb out of the deep pits that you dishonestly dug. Schmoozing with a supplier is easier than digging. On the other hand, honest dealings, over time, build the solid foundation of respect and admiration upon which a supply manager’s success depends.

 

What do you think is most important for a supply management professional?

The very best way to build relationships is to always do what you say you’re going to do, and to always hold yourself account­able for your actions.

 

Is there an ideal way to organize around supply management?

Nothing provokes as much discussion and disagreement as what is the so-called “best” supply management organization. Relax. There is no single optimal organization. What is essen­tial is that the head of supply management must be at the vice president level. At minimum, purchasing and logistics must be within the confines of the organization chart. The skill sets for folks within the organization include: great people skills, an incli­nation for strategic thinking, process-improvement skills, and relationship-building skills. Individuals who lack this skill set should not be given high positions in the organization.

 

What do you think is most critical for supply management?

You must have a disciplined collaborative approach to sourcing. Cross functional teams are paramount to get wide buy in to supplier selection. Business units are internal customers and should participate in the selection; however, never lose sight of the needs of what I call the final or paying customer for your end product. Many of the aspects that internal customers feel are

 

Once you select a supplier then what?

Always go with fewer meaningful supplier alliances. Trying to manage many so-called alliance relationships is nearly impossible. Pick your alliances carefully. One criterion that I used to select alliance was if the supplier could give us a competitive edge. Another criterion could be a material or service that was a major cost fac­tor for us. It does not make sense of waste time with an alliance with suppliers that provide readily available consumables or other nonessential items. The hard part about alliances is the demand for constant communication and relationship building. Relation­ships take time and energy. Make sure you agreed to metrics and define clearly your success factors. Always try to select a supplier who has experience with alliances.

 

Anything else critical?

Prior to attempting a transformation you need to know where you are spending your money. If you don’t, the process is doomed to failure. Here are some questions (checklist) to ask. They work for almost any size company.

Establishing a strong communication plan for your supply management initiatives is critical for its success. Seeking help from trained marketing professionals and communication experts is essential. A continuous communication plan using various media will help overcome the resistance to change.  You need to spend at least 30–40 percent of your time get­ting the word out to folks, by many communication channels, on your strategy, messages, and plans. You cannot over communi­cate, especially about something as radical as transforming the supply chain.

 

What about continuous improvement?

No other department in an organization has more dynamic issues to deal with than supply management does. Supply man­agement is continuously challenged by changing global events and demands from both internal and external customers. My advice to supply management professionals is to lead the change and not be a victim of change. They need to lead not follow these efforts!

Lean, Six Sigma, and Lean Six Sigma are just disciplined approaches to problem solving. They are a combination of solu­tion tools used in a systematic manner. Decisions are supposed to be data based. Lean Six Sigma is very disciplined and plodding. All these approaches can be highly successful, but patience and discipline is required. A kaizen is a more structured approach, but flexible and quick enough to produce quick results. Kaizen is a term meaning “continuous improvement.” In Lean Six Sigma terms, it refers to a project performed at the work-group level that will remove waste from a process. These types of projects can be performed quickly (usually in less than two months). I prefer to perform them in two weeks or even less.

 

What is your philosophy on negotiations?

Information-based negotiations are an approach to nego­tiations that emphasizes deep knowledge of the supplier and its industry. It varies greatly from some traditional approaches to negotiations. It’s not the adversarial Win-Lose negotiation style with the emphasis on game playing, exposing untruths, and taking full advantage of the supplier’s weaknesses. This old approach is a competitive winner-takes-all system that rarely builds longstand­ing, deep relationships with suppliers. Information-based negotia­tions are not based upon the Win-Win model, either. Information or knowledge is definitely power, but in information-based nego­tiations, the supply chain professional gains a deep knowledge of the supplier’s industry, their margins, and their culture. In essence, this is a deep immersion or empathy with the supplier and their competitive landscape.

 

What about your thoughts on planning and metrics?

The Institute for Supply Management notes that 95 percent of supply chain departments do not have a procurement strategy or long-term supply management plan. Of the 5 percent that do in fact have a strategy, only half have successfully aligned the strategy with overall business strategy. Don’t be afraid to put non-traditional metrics in your plan. Remember, people behave according to the way that they are rewarded. After you have a strategy, you must educate other employees on its tenets and the reason behind it.

 

Any more thoughts on supplier management?

Radically reducing the number of suppliers is one of the first efforts that must be tackled. You can’t have “relationships” with thousands of suppliers. It’s difficult enough to have strong rela­tionships with just a few key suppliers. Ruthlessness is necessary. This is not the time for compassion or backing off your supplier-reduction goals. Set the new supplier standards high. You will be surprised. Many will not want to participate under your new, higher expectations. Does the supplier add value, or is the sup­plier a product of misplaced loyalty? We once cut a base of five thousand suppliers to 252 in three months. It can be done, but ruthlessness was required. Any supplier can lowball on the price of any item. I have seen it done hundreds of times. Retail stores are great at having a lead-in low-price item in one aisle with the marked up high margin items very near. Always benchmark your prices whenever possible with other companies. Keep a handle on the price pulse. When a supplier offers a lowball price on a particular part or service, see if they can extend the percent price decrease to all the other items you buy from them. Usually, dead silence results, or the quick backped­aling begins. Calling their bluff almost always works. Call it.

The best companies have the best suppliers!

 

Any more supplier lessons learned?

Never incorporate a new supplier without a test run of buy­ing an item from them, period. No exceptions. Have a purchas­ing professional pretend that he is an end-user. Have him play dumb and actually order an item from the new supplier. Review the entire transaction process to include acknowledgement and invoice payment. Carefully process-map it out, and use Lean and Six Sigma principles. Check on status often. This one road test tip will save you mountains of headaches and resistance to change. Folks do not really want new suppliers. Bad new suppliers infuriate internal customers. Remember most folks do not like change. They will latch on to any minor or frivolous mistake to justify their resistance and to castigate the new supplier.

Progressive supply management is highly team-oriented—especially cross-functional teams. The examination of the supply chain and total cost of ownership drives the decision-making process. There is a systematic process for supplier selection. Relationship building and management is the key skill for the purchasing pro­fessional. When senior management not only supports but also understands the process, purchasing becomes a true business partner and leader.

Show folks how you are doing versus your metrics. Use pictures and graphics. People can relate to them much better. Spreadsheets are not very publicity friendly. Don’t be shy with graphs, and always display them professionally. Keep the radar gun on the process and suppliers. Let other folks see the results, good and bad.

One of the fundamental tenets of Lean is visibility. Use it in supply management.

Purchasing, supply management, and transaction discipline are critical. Most folks do not like it, but most of the routine pur­chases and process must be disciplined. Discipline—especially around using preferred suppliers—must be strictly enforced. Make folks e-savvy and adept at using catalogues. Teach them how to search catalogues, or they will soon quit searching.

 

Any concerns about global sourcing?

If you decide to deal directly with the source or supplier in another country, you need to realize that reaching a strong cul­tural understanding will make or break the process. The task of understanding the culture of the sourcing country is the most dif­ficult of the entire process. Culture includes social organization, political beliefs, the legal system, religious beliefs, language, and the educational system, to name just a few. Any one of these areas requires extensive study and understanding in order to be suc­cessful. It is no small task.

 

Finally any advice to someone new in supply management?

Yes get out from your desk! Check the supply chain links, visit suppliers, learn about industries and do not be afraid to get hands on experience.

 

Contact Dr. Tom = thomasdepaoli@yahoo.com drtombooks.com for newsletter sign up https://drtombooks.com/contact/ My Books link: https://www.amazon.com/Tom-DePaoli/e/B003XSV1IQ