.Measuring Up Your Suppliers

Measuring Up Your Suppliers

            Suppliers that have had experience with non-traditional purchasing concepts, alliances and partnerships definitely have an advantage when it comes to developing a deep relationship with them. Make sure you take the time to explain your procurement or supply chain strategy to them and to take the time to understand their strategy. They need to know what’s in it for them. Make it clear and measurable. Feeling good about each other will not get to the bottom line. Appearances do count.  You can size up a supplier’s partner quotient a lot by actual site visits and talking to their employees at all levels. Smiling faces are better than growls and disgruntled remarks. This new frontier with suppliers has some particular characteristics.  These characteristics include most favored customer contracts, elimination of incoming inspection, reduction of supplier base, early supplier involvement in design, value engineering, mutual cost reductions, targeting of non-production company costs, the complete integration of key suppliers into the business, and extensive use of cross-functional teams.   This quantum leap philosophy with suppliers requires the education of purchasing personnel, rapid access to information and supplier empowerment. Cross-functional business teams and a constant dedication to improve and to reduce time to market are key elements.

            Quantum leaps are usually made by actually listening to the supplier and implementing their recommendations. Rarely do they occur from internal suggestions. Suppliers are the experts on their particular parts or service not you. Heed their suggestions.

            We once had a supplier recommend a simple design change on an iron casting. Not only was it cheaper but the production line was ecstatic because it was much easier to assemble. The former appendage of the old design had often broken off during assembly.

Become a Transformer!

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

Try these transformational books!

Why Women Are Much Better at Breakthrough Negotiations!

Why Women Are Better At Relationships.

Women are far superior in relationship building and getting people to cooperate and problem solve together. Negotiation at the strategic level should not be considered a "contest" or sporting event. Unfortunately, many men view it in this manner. At the strategic level it is more about making breakthroughs together and getting a unique competitive advantage, that your paying customers cannot ignore. You desire what I call "leapfrog" breakthroughs, not wins and losses. Again, we do not want to stereotype, but from my experiences, most women have far superior relationship building skills. Don't confuse this with the old fashion beat up your opponent adversarial negotiation methodology. This is appropriate for some situations. But it rarely results in breakthroughs.
I explain this in more detail in my books.

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

Pay Purchasing via the New Wave

 

 

 

 

 

Most supply chain professionals are familiar with the best practices of a supply chain organization and how to transform purchasing into a lead strategic partner in a company. These usually include a thorough spend analysis to focus on the major areas of materials and services. Another aspect includes the rationalization of suppliers and the formation of a few key partnerships with important suppliers. The institutionalization of a comprehensive sourcing methodology is also crucial. The area that is often overlooked or neglected is the investment in people!

Many purchasing professionals have been rewarded for bureaucratic and tactical behaviors for many years. The culture of risk aversion is prevalent and roles are particularly well-defined and limited. They focus on a particular material or service and become “experts” on these items. Often they work in silos and have no real connection with operations. It is usually not their choice but the expectations of the culture or of their organization.

The retraining of supply chain professionals begins with developing the capability to lead cross-functional teams not only in sourcing, but in process improvement activities such as Lean and Lean Six Sigma. Most need to reach the level of at least a green belt in a process improvement approach, and to reinvent themselves to be total product experts not just a particular material expert. You have to be a product expert to understand the Voice of the Customer (VOC) or what is really important to them. This requires striving to become an expert in an entire industry not just a narrow material. It also requires a dedication to understanding and working with operations. Performance reviews need to be tied into how well they do in predicting the market trends of their particular industry and meeting or exceeding the VOC.

All too often this training is piecemeal, unorganized and uncoordinated. Fortunately there is a comprehensive approach that has been around for 40 years that works in many industries particularly ones where employee knowledge is highly valued like the chemical, oil and process industries. The approach has been called pay-for-skill or pay-for-knowledge. Employees are paid more for each skill or knowledge area that they develop, and demonstrate their proficiency in by job performance. It does require a significant monetary investment by the organization in training employees and the organization evolves to a continuous learning campus. The word campus is critical because many organizations partner with local technical schools or universities to jointly provide the comprehensive training and courses.

Unfortunately many organizations have disinvested in training employees and would rather outsource for many skills or functions. This is deadly to the supply chain concept and process improvement, which must strive to constantly improve the entire supply chain from start to finish without breaks which may or may not be performed better by an outsourced entity.

The major objection to the pay-for-skill approach is the cost and the length of time for payback from the employees’ improved knowledge. Once in place, however; the power of this employee intellectual capital, and the momentum of continuous improvement, establishes a supply chain centric organization that is nearly impossible to beat competitively.

People transform supply chains and organizations not technology or best practices.

Why Broken Windows Management For Organizations

Why Broken Windows Management?

The biggest reason for using the Broken Windows Management method is its simplicity, speed and its success record. People have a very low tolerance for long drawn out and methodical processes to improve work. The Broken Windows Management approach offers a quick and more rational approach to improving work. It works best when the people who actually do the work participate in and make the changes.  This foundation in fixing employee dissatisfiers adds to its credibility. It is a full speed ahead solution to small improvements in quality of  work life and processes.

Who Does the Work - Advantage

            Employees should point out the issues and problems; they can also participate in fixing them. It can be one of the more participatory management strategies.

Is the Broken Windows Management the Right Tool?

            Using the Broken Windows Management in an organization that is not ready for it is a losing proposition. Employees must be convinced that management is serious about the theory and backs up the theory with visible results.

1.    Get the small projects done quickly

2.    Don’t be afraid of being overwhelmed, keep fixing and attacking the employee issues.

3.    Get leadership on the firing line or on the shop floor including executives.

4.    Get as much intelligence about what employees want as you can handle.

5.    Fix things!

Does Broken Windows Management Work?

            First off the track record of many management flavors-of-the-month is abysmal. Although the broken windows theory has be used in law enforcement and is controversial, my main recommendation for using it is t the following:

·      It actually fixes the issues that employees’ want fixed.

·      It is highly visible and can be easily tracked.

·      No expensive consultants or theories are involved.

·      It does include improving quality of work life and morale.

·      It improves the entire organization’s skill is fixing things.

·      It builds employees trust in management.

I cannot honestly point to reams of data or studies that a\say that it works. I can only say that out of many management theory options or fads it is one of the most practical and uncomplicated.

I urge my readers to give it a try.

Broken Windows Management for Business

Review from Kelly Barner!

One of the most powerful things you can do with broken windows management is to empower your employees to fix their own issues whenever possible.” (p. 35)

In his fifth business book (seventh overall) Dr. Tom DePaoli takes broken windows theory and combines it with liberal doses of lean methodology and his own no-nonsense approach to process improvement. While this is not a long book, just 70 pages long, it is a working book. This is emphasized by the pages at the back that are specifically designated for “Doodles, Notes, and Ideas.”

Broken windows theory is an approach to establishing and maintaining urban stability by addressing minor crimes and disturbances. Simply put, the idea is that if you fix the broken windows, the effect that has on the environment will lead to reductions in larger scale crimes. Introduced in 1982, broken windows theory has been applied a number of times, perhaps most notably by Mayor Rudy Giuliani and Police Chief Bill Bratton in New York City. It was also covered by Malcolm Gladwell in his book The Tipping Point.

Dr. Tom takes the theory and focuses on the role it can play in empowering employees by working with them and through them to improve an operation. As he wrote, “The more you fix problems, the more employees will trust you.” (p. 9) But while these changes may be minor in the grand scheme of things – access to food/drink, better parking, conveniently managed supply inventory – the reason for all of it is improved team cohesion and results.

There are two ideas that I particularly like:

Anticipatory maintenance: “Instead of having maintenance people wait around and wait for something to break, encourage them to seek out issues that bother employees and work with employees to improve them. This is beyond preventative maintenance, where you maintenance workers team up with the employees and find out the real issues that can make their quality of work life better.” (p. 31) This is a great application of broken windows management. It signals the importance of time and effort, and positions every member of the team as a valuable contributor. Since no situation is ever perfect, there is always an opportunity to make improvements. Allowing employees to make decisions about how to use that time leverages their unique perspective and sets the expectation that everyone be productive at all times.

Non-value vs Value-Adding steps: “Clearly identify the process-cycle time, delays, handoffs, and any inventories, and try to differentiate between non-value and value adding steps.” (p. 19) One of the areas where Dr. Tom’s lean experience really shines is through process discussion and improvement. And as detailed as these processes can be, teams should understand the different kinds of steps that make them up. Not all steps add value – but not all steps need to add value. By understanding the difference, management teams can focus their attention and measurement efforts where they will generate the best return.

If you are a hands on manager looking for a way to improve the performance of your team and operation, this is a great book to pick up over the summer. It is deceptively thought-provoking and actionable for its short length and will help you restore focus to the little things that are really the big things.

Storytelling Method

Dr. Tom DePaoli, Assistant Professor, Management, at the School of Business and Public Safety, has had another article published at My Purchasing Center; Use the Story Telling Method to Train Supply Chain Professionals , Dr. DePaoli describes an approach below:

“The leader of the team should lead off and share personal supply chain stories of success and failures. There should be a general framework for the stories. In our framework, we structure the stories to first give a background of the situation or issue, and then tell how resources are gathered to address the issue (approach), and finally reveal the results. Often the approach to solving the problem is more important than the actual results.”

Dr. DePaoli has published numerous books listed on his Amazon author’s page https://www.amazon.com/author/tomdepaoli  He is a regular contributor to mypurchasingcenter.com.  

One of the oldest methods of passing down knowledge is oral storytelling. Usually an ancient sage would be the keeper of the stories and pass them down to other tribe members. I highly recommend this method for supply chain professionals.

Here are some advantages of storytelling: 

• The brain stores information by stories.

• Stories are humanizing and stimulate creativity.

• Storytelling improves listening skills.

• Storytelling builds a team culture.

• It encourages collaboration.

First, creating the right atmosphere and teamwork is essential in order to establish the validity of this method. The trust of all members of the team and non-attribution is essential. The leader of the team should lead off and share personal supply chain stories of success and failures. There should be a general framework for the stories. In our framework, we structure the stories to first give a background of the situation or issue, then tell how resources are gathered to address the issue (approach), and finally reveal the results. Often the approach to solving the problem is more important than the actual results. Colleagues are encouraged to ask questions and to suggest more appropriate approaches. Supply chain professionals have many touch points or people involved throughout the supply chain. Stories should not be limited to paying customers but include suppliers, colleagues, competition, other departments etc.

Here is an example:

Background: We went through comprehensive sourcing selection process with a cross-functional team. We involved all the key stakeholders and were very meticulous in our research and selection. We were highly confident that we had selected the right water pump supplier and were expecting significant hard and soft savings. The supplier had prior experience with partnerships and alliances.

Approach: Much to my surprise after two weeks I discovered that the process was not going well. Maintenance personnel were complaining about the new supplier so I decided to investigate. I walked around the plant and talked to maintenance personnel and their department heads. I soon discovered that the issue was not the quality of the pumps. The issue was the representative that the supplier had assigned to our account. The rep just could not adjust to our people or culture. The personality was not a fit.

Results: I approached the supplier and requested that a new representative be assigned to our plant. The new representative got along well with everyone and we made great progress in savings and innovation. The lesson that I learned is that the selection team should interview the potential supplier’s representative during the selection process and ensure that they are a fit. We thus added “chemistry” to our selection process.

We used this same storytelling method after every sourcing event and continued to discover issues that we had missed. We then added them to our overall sourcing methodology or checklist. Storytelling is a powerful collaborative learning tool. I recommend taking full advantage of it.

- See more at: http://www.mypurchasingcenter.com/office-products/blogs/use-storytelling-method-train-supply-chain-professionals/#sthash.xfO90rxV.dpuf

Ironbottom Sound and My Dad MM1Martin “Marty” DePaoli USN

Ironbottom Sound and My Dad MM1Martin “Marty” DePaoli USN

They call it “Ironbottom Sound" (alternatively Iron Bottom Sound or Ironbottomed Sound) it is the name given by Allied sailors to Savo Sound, near Guadalcanal.

My dad, Marty, has a strong connection to what happened there.

During the late 1930’s my father, MM1 Marty DePaoli, served four years in the Navy as a machinist mate on board USS Quincy (CA-39), which was a United States Navy New Orleans class heavy cruiser. He was very close to all his shipmates and cruised around the world and went on the Neutrality Cruise. He left the Navy in late 1939. He got out just in time, right before Hitler invaded Poland. After the invasion the Navy did not allow anyone to get out. This was sort of a stop loss or backdoor draft, so most of his shipmates were not allowed to leave at all.  He then took a really good job as an aircraft engine machinist in civilian life.
When Pearl Harbor happened, the aircraft company thought so highly of him, that they offered to support a deferment for him. He had in fact already served four years in the Navy. He did not have to serve again at all. He refused the deferment, and he enlisted again in the Navy, even though he did not have to go. I did not learn about this until I got his Navy records after he died. Most people who knew him will not be surprised that he scored off the charts (99% +) on mechanical and electrical Navy aptitude tests.
When he enlisted, he requested to be stationed on his old ship the USS Quincy (CA-39).  He knew the ship and his former shipmates very well. At that time however, it was in dry-dock being refurbished and up-gunned and armored. The Navy denied his request and rushed him directly to the fleet (on a destroyer) because they needed all the experienced prior service Navy personnel possible. The Japanese were winning everywhere.
Shortly later in the war, his old ship, the one he requested to be on, the USS Quincy (CA-39) was sunk at the Battle of Savo Island in 1942 with great loss of life (almost the entire crew) and lies at Ironbottom Sound. My Dad didn’t hear about it until six months later. At that time the U.S. government censored the loss because of morale issues and the fact that the Japanese were still winning everything.
When I was on active duty at the Navy Yard in Washington DC, (I was recalled to active Navy duty for four years after 9/11) I would often visit my Dad on weekends in Royersford. I obtained a photograph of his old ship the USS Quincy (CA-39) from the Navy museum on base. Only black and white photos exist and I brought it home for Dad.
My Dad looked at the photo and went very quiet and teared up. He reluctantly started to talk about it; I could tell it brought back memories and much sadness.
Then one of the most incredible experiences of my life happened.  People who knew my Dad knew he was a great storyteller. My Dad started to talk about many of his old dead shipmates. He would state their name and rate, describe them and tell stories about their adventures, hijinks, things they did on liberty and what hometown they were from.  This went on for over an hour.  I just listened in awe. My Dad was in his nineties but his mind and memories were still very sharp.  For this one hour my Dad had honored his dead shipmates and brought them back to life for me. We never talked about the USS Quincy (CA-39) again after this.
If my Dad had gotten his wish on his second Navy enlistment and been assigned to the USS Quincy (CA-39), my family and me would not be here today. He lost all of his old shipmates, who were more that brothers to him, who now rest at Ironbottom Sound. My Dad understood ultimate sacrifice and greatly missed his old shipmates. On this Memorial Day let’s honor my Dad, his USS Quincy (CA-39) shipmates, and all who made the ultimate sacrifice for us.

Help Children Stop Bullying with Sydney

Sydney the Monster Stops Bullies: Enchanting New Book Empowers Children to Stop Bullies in their Tracks. Kids (and Monsters!) Can All Be Friends… 

In Dr. Tom DePaoli’s ‘Sydney the Monster Stops Bullies’, a quirky and friendly monster overcomes his own bullying nightmare to emerge a true victorious hero. Through a story that is entertaining, uplifting yet inherently serious, young readers will not only learn how to spot bullying and its social, physical and mental detriments – but also find the empowerment they need to respect humanity’s rich differences.

For Immediate Release

Sheboygan, WI– There’s no way to sugarcoat it, bullying has become a fierce epidemic in modern schools and turns the lives of millions of children into a misery. Most victims find it hard to speak out and, acutely aware of young minds and their thirst for stories, one U.S. author has chosen a novel way to reach out to them.

‘Sydney the Monster Stops Bullies’ is the latest release from Dr. Tom DePaoli. The volume’s premise is bold and clear-cut: to teach children what bullying really is, how it can plight their lives and what they can do to help friends who may be suffering. Oh yes, it will also make them more tolerant, too!

Synopsis: Sydney the Monster Stops Bullies is about Sydney the monster who is a friendly monster and uses special monster powers to stop bullies and teach children to respect differences. Sydney is a first bullied by the other monsters but then becomes a hero!

“The story’s bottom line is a powerful moral of friendship, love and support; forces that can transcend bullying and bring any child’s life back on track,” explains the author. “It is vital that children learn to recognize the social, physical and psychological effect that are part and parcel of bullying. Preaching directly to children doesn’t work, so I opted for an enchanting story with a happy ending! All kids love monsters, hence why I created such an unusual main character. Sydney is able to influence children in a way no human can, and the fact that he is one step removed from real life allows children to confide in his message in a way they simply couldn’t with any friend or relative. It’s powerful stuff.” The author sees wide appeal for his work. “There’s no denying that bullying is an epidemic that knows no geographical or cultural boundaries. Therefore, this book has truly global potential. There should be a copy in in every home, school, church or any place where young people congregate. It contains a message they desperately need to hear.” ‘Sydney the Monster Stops Bullies’ is available now! Click on Amazon.com  or   url =  http://amzn.to/1HgOd5j  to buy.

About the Author 

Dr. Tom DePaoli, is a professor in the School of Business and Public Safety at Marian University. He has previously published six books that are available on Amazon.com. For more information, visit the author’s official website http://www.apollosolutions.us    Contact: Dr. Tom DePaoli / thomasdepaoli@yahoo.com / 920-698-2959.

Purchasing Can Bootstrap Organizational Transformation!

Can Purchasing Bootstrap and Lead the Transformation of An Organization?

Purchasing’s role in an organization touches across many departments, suppliers, countries, and competitors. This situation requires that purchasing professionals possess excellent communication skills and the ability to quickly adapt to different cultures, perspectives and crises.  Transforming your own organization’s culture is a grueling challenge. Expecting purchasing to “bootstrap” or use its own resources rather than external help, in organizational transformation, is a demanding goal.  Purchasing, however, has many of the qualities and capabilities to act as the prime catalyst for this quest.

In fact many, purchasing organizations have radically changed or reengineered themselves from traditional clerical type organizations. The supply management or supply chain concept is rapidly becoming the norm. This type of change was monumental and transformative. Could purchasing pull the bootstrap off? Most would say highly unlikely, but below are some tactics that could lay the groundwork or accelerate a successful transformation of an organization. Many have been previously used to transform purchasing into supply management.

One of the best ways is by breaking down department silos by involving diverse cross-functional teams in sourcing decisions. Including internal and external customers in as many decisions as possible is a sound empowerment tactic that pays off dramatically. Teamwork in such efforts deepens the understanding of participating employees in the overall purchasing cycle, and helps imbed the concept of total cost of ownership.

Incorporating grassroots efforts to ask internal customers what they want to help simplify purchasing transactions is another powerful tool. People usually appreciate colleagues who try to make their jobs easier and are not afraid of criticism.  Making all transactions pain free, fast and intuitive is a strong way to be valued and improve respect for purchasing. Acquiring strong base business knowledge for purchasing, by working side-by-side with production and sales, both improves product knowledge and enhances purchasing professionals’ credibility and business perspective. This helps expand the understanding of the voice of the paying customer.

Marketing the importance of purchasing and the supply chain with visible metrics creates a clear focus that others appreciate. Purchasing has to aggressively market their importance to the organization and develop a formal internal marketing plan of their goals. Crafting a long-range purchasing plan that aligns with the organizations vision, mission and strategic plan helps to justify purchasing’s efforts to the rest of the organization.  Communicating with, as many colleagues on a one-on-one basis should be especially encouraged. This gives purchasing professionals a chance to make their pitch to as many folks as possible and develop strong relationships.

Conducting training and inviting people from other departments to participate helps sell purchasing’s goals and metrics. Vital feedback can be obtained on the usefulness of purchasing systems and procedures in such sessions.  Finally but most importantly, developing leadership skills and practicing leadership in groups is a good long-term skill-building course of action for all of purchasing. Most experts agree that one skilled leader can turn an organization around. Purchasing needs to be ready with leadership skills to help lead or encourage the organizational transformation process.

Any department would face and probably fail at the nearly impossible task of bootstrap transformation of an organization. Purchasing however would be the best place to start the transformation quest and develop the passionate and powerful leaders required to execute it.

Dr. Tom DePaoli

Dr. Tom DePaoli is the Management Program Director at Marian University in Fond du Lac, Wisconsin, and the Principal (CEO) of Apollo Solutions (www.apollosolutions.us) which does general business consulting in the supply chain, Lean Six Sigma and human resources areas. Recently he retired from the Navy Reserve after over 30 years of service. In other civilian careers, he was a supply chain and human resources executive with corporate purchasing turnaround experience and Lean Six Sigma deployments. He is the author of: Kaizen Kreativity (Oops!), Common Sense Purchasing, Common Sense Supply Management and Growing up Italian in the 50s. 
 His Amazon author’s page is   https://www.amazon.com/author/tomdepaoli
 His LinkedIn profile is:  www.linkedin.com/pub/dr-thomas-depaoli/0/736/6b3/

Sizing up Your Suppliers and Preparing Them for Your Strategy.

Sizing up Your Suppliers and Preparing Them for Your Strategy.

            Suppliers that have had experience with non-traditional purchasing concepts, alliances and partnerships definitely have an advantage when it comes to developing a deep relationship with them. Make sure you take the time to explain your procurement or supply chain strategy to them and to take the time to understand their strategy. They need to know what’s in it for them. Make it clear and measurable. Feeling good about each other doesn’t get to the bottom line. Appearances do count.  You can size up a supplier’s partner quotient a lot by actual site visits and talking to their employees at all levels. Smiling faces are better than growls and disgruntled remarks. This new frontier with suppliers has some particular characteristics.  These characteristics include most favored customer contracts, elimination of incoming inspection, reduction of supplier base, early supplier involvement in design, value engineering, mutual cost reductions, targeting of non-production company costs, the complete integration of key suppliers into the business, and extensive use of cross-functional teams.   This quantum leap philosophy with suppliers requires the education of purchasing personnel, rapid access to information and supplier empowerment. Cross-functional business teams and a constant dedication to improve and to reduce time to market are key elements.