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Reframing Professional Societies(APICS and ISM)
OR:
“Let’s Go Out and Break Some Paradigms!”James D. Reeds
MS, C.P.M., CPCM, CFPIM, CIRM
PresidentISM Silicon Valley, Inc.
andAPICS Region 10 Staff
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For Your Consideration
Present Paradigms and Paradigm Shifts Scientific Management as a Mental Straight Jacket The Evolution of Supply and Contract Management
Thinking Slouching Toward the Future - The Need for
Breakthrough Thinking A New Model for Supply and Contract Managers The Way Forward Q&A
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Proposition
At the End of 2006, the Paradigms that have Guidedthe Professions of Supply Management and ContractManagement are Obsolete.
Symptoms:♦ Absence of a Cohesive, Articulate Strategy♦ Muddled Vision and Way Forward♦ Confusing, Contradictory Terminology♦ Empty Slogans and Dubious Marketing Campaigns♦ Bleeding Membership
Perception:♦ Out of Touch with the Now and Future Business
Environment
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ORIGIN Late 15th Cent.: Via Late Latin From Greek Paradeigma, FromParadeiknunai - Show Side by Side, From Para- beside + Deiknunai - toShow.
Paradigm
A Typical Example or Pattern of Something; aModel
A Worldview Underlying the Theories andMethodology of a Particular Scientific Subject
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Paradigm Shift
ORIGIN 1970s: term used in the writings of Thomas S. Kuhn (1922-96),philosopher of science.
A Fundamental Change in Approach orUnderlying Assumptions.
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Portable Radio - Paradigm 1922
WGY Schenectady, New York, 1922Portable Crystal
Radio
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“Portable Radio” - Paradigm 2006
Apple I-Pod Nano
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On the Currency and Certainty of Knowledge
“Fifteen hundred years ago everybody knew theearth was the center of the universe. Five hundredyears ago, everybody knew the earth was flat. Andfifteen minutes ago you knew that people were aloneon this planet. Imagine what you’ll know tomorrow.”
Tommy Lee Jones to Will Smith - “Men inBlack”
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Solving the Supply Management andContract Puzzle
In What environmentdoes SupplyManagement Operate?
How does SupplyManagement, ContractManagement andSupply ChainManagement Interact?
How do we make senseof it all?
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Supply and Contract Management Knowledge andProfessional Competencies
People♦ Where Can I find Quality Education and Training?
Companies♦ Where Can We find Competent People?
Schools♦ Where Does a Supply and/or Contract
Management Curriculum Fit? Governments
♦ Where Can We find Competent People? Nation States
♦ Elevate Supply and Contract Management as aStrategic and Competitive Asset?
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For Corporations: The Ghost of Freddy Taylorand Functional Silos
Find the One Best Way Choose Workers Based on
Task Specialization Match People to the Task
♦ “Do Not Think - Just Do”
Hire Managers to Plan andControl♦ Supervise, Reward and
Punish
Apply Labor Efficiency
Frederick Winslow Taylor(1856-1915)
The Father of Scientific Management
The Foundation of Industrial EngineeringTop-Down - Hierarchic Organizational StructuresReductionism
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For Corporations and Governments: TheConundrum of Compliaance
People
Process
Technology
Events
Operation
Modelling and Deployment
Strategy
Jurisdiction
Business Process & Rules
Industry Best Practice External Auditors
Policy Provisioning
Historical Data
CRO
ISV Apps
Reporting
Storage
Systems
RegulatorsNational GovernmentSuper-National Government
SocialEnvironment
Internal Events
External Events
Analysts
Internal Auditors
CompetitivePressures
Standards Orgs
Risk Analysts Network
ProcessModification
Sensors & Actuators
Deployment Tools
Stakeholders
CxOCxOCxO
Proj mgr, Implementers
Refined Business Process & Rules
Business Policy
Senior Leadership
CROCFO
Board of Directors Internal Processes
Harmonize Internal with External
Audit CommitteeCGO Internal Auditors
CEO
LOB execs
Bus Proc Owners
Op Apps
Business Process Execution
employees
Event Monitoring
Modeling Tools
Laws/Regulations
OpRisk Models
Taxonomies
Regulation Models
Process Execution Platforms
A Unified Framework for Governance, Risk and Compliance Must Support People, Process, and Technology.Source: Dr. Anthony Tarantino. IBM Governance, Risk and Compliance Center of Competence. ISM SiliconValley Dinner Presentation. October 19, 2006. Santa Clara, Ca. “Governance, Risk and Compliance (GRC)Introduction.”
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For Schools: Not Enough Degree Programs toMeet the Demand of Industry
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For Professional Societies: Refocus andRebranding
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NCMA Span of Professional Certifications
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A New ISM Certification to Reflect NewSkills
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APICS - New Certification and Rebranding
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APICS New South Wales
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19Time
+S+Cx
Change+
Speed+
Complexity
1970 1980 1990 2000 2010
Stage 5Value NetworkManagement
Stage 4Value ChainManagement
Stage 3Supply ChainManagement
Stage 2ProcurementAnd ContractManagementStage 1
Purchasing andContract
Administration
The Evolution of Supply and Contract Management
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Syste
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The Focus of Supply Management and Contract Management Behavior
The Burt-Lynch Model of SupplyManagement Evolution& Competitive Strategy
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Syste
mic
Fo
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Stra
teg
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Pro
ce
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Fo
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ctio
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l Fo
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Cle
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l Fo
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2
3
4
5
+S+Cx
Change+
Speed+
Complexity
1970 1980 1990 2000 2010
Stage 5Value NetworkManagement
Stage 4Value ChainManagement
Stage 3Supply ChainManagement
Stage 2ProcurementAnd ContractManagement
Stage 1Purchasing
and ContractAdministration
Evolution and Focus: Supply and Contract Management Behaviors
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Systemic FocusStrategic FocusProcess
Focus
Proactive Behavior
● Risk Motivated● Lateral Thinker● Embrace Complexity● Future Orientation● Long-Term Perspective● Guidelines● Self-Directed● Portfolio/Program/Project ManagementOrganizational Structure● Process Bias● Collaborative Relationships● External/Extended-Enterprise Stance● Root Cause Problem Solutions● Prevention
Future
TransactionalFocus
ClericalFocus
Reactive Behavior
● Risk Averse● Linear Thinker● Routinized, Repetitive Actions● Historical Precedent● Short-Term Perspective● Policies & Procedures● Hierarchic OrganizationalStructure● Internal/Functional Bias (Silos)● Adversarial Relationships● Arms-Length Stance● Fire-Fighting● Expediting
Past
Behavior Orientations - Personal Mindsets
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TransactionalFocus
ClericalFocus
Reactive Behavior
Past
Behavior Orientations - Organizational Mindset
Functional Silos Frequent Functional
Reorganization Efficiency and Resource Utilization Optimization of Complexity Internal Metrics Hierarchic Control Structure “Garrison” Mentality
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Systemic FocusStrategic FocusProcess
Focus
Proactive Behavior
Future
Behavior Orientations - Organizational Mindset
Process Orientation Process Integration and Harmony System Effectiveness Flexibility Global Metrics Program/Project Teams Relationship and Alliance-Building Value Realized Amongst Chain and
Network Player Innovation
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Stage ONE - Clerical Behaviors
STAGE 1. Clerical Behavior VARIABLES Tactical Buying
Value Driver Timely Availability, Convenienc e
Financial Impact
Overhead-Cost Center
Integration Level & Functional Elements
No Internal Integration Purchas ing
Basis of Competitive Advantage
Do the Job
Performance Metrics Timeliness & Efficienc y
Performance Metrics
Nothing
Knowledge Thomas Directory Phone Book Rolodex
Supplier Relationships
Personal
Time Focus Isolated from Customer Environmental Not Considered
+S+Cx
Change+
Speed+
Complexity
1970 1980 1990 2000 2010
Stage 4Value ChainManagement
Stage 3Supply ChainManagement
Stage 2Procurementand ContractManagement
Stage 5Value NetworkManagement
1975
Stage 1Purchasing and
ContractAdministration
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Stage TWO - Transactional Behaviors
STAGE 2. Transactional Behavio r VARIABLES Transactional Bid-Based Buying
Value Driver Purchase Price
Financial Impact
Improve Bottom Line,
No Consideration of Revenue Impacts
Integration Level & Functional Elements
Low Internal Integration Procurement & Logistics
Basis of Competitive Advantage
Leverage Size of Buyer Power Dynamics Between Buyer & Seller
Performance Metrics
Low Component/Unit Cost On Time Delivery
Performance Metrics
Squeeze the Vendor Internet, Auction s
Knowledge e-Commerce “Should Cost” Analysis
Supplier Relationships
Adversarial & Transactional
Time Focus Reactive to Customer Environmental Added Cost Factor
+S+Cx
Change+
Speed+
Complexity
1970 1980 1990 2000 2010
Stage 4Value ChainManagement
Stage 3Supply ChainManagement
Stage 1Purchasing and
ContractAdministration
Stage 5Value NetworkManagement
1985
Stage 2Procurement and
ContractManagement
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Stage THREE - Process Oriented Behaviors
STAGE 3. Process Based Behavi o r VARIABLES Supply Chain Managemen t
Value Driver Quality Just In Time Total Cost of Ownership
Financial Impact
Improve Bottom Line Some Consideration of Revenue Impacts
Integration Level & Functional Elements
Partial Internal Integration Procurement, Logistics, Operations, Engineering
Basis of Competitive Advantage
Through-Put Global Impact
Performance Metrics
Coordination & Cost Develop Suppliers
Performance Metrics
Process Innovation Develop Requirements Near Defect Free Supply
Knowledge Understand Suppliers
Supplier Relationships
Transactional & Collaborative
Time Focus Responsive to Custom e r Environmental Considered As Part of T C O
+S+Cx
Change+
Speed+
Complexity
1970 1980 1990 2000 2010
Stage 4Value ChainManagement
Stage 2Procurementand ContractManagement
Stage 1Purchasing and
ContractAdministration
Stage 5Value NetworkManagement
1995
Stage 3Supply ChainManagement
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Stage Four - Strategic Behaviors
STAGE 4. Strategic Behavior VARIABLES Value Chain Management
Value Driver Innovation Top & Bottom Line Internal Integration
Financial Impact
Revenue & Bottom Line Impacts
Increase Share Holder Value Transform Innovation into Value
Integration Level & Functional Elements
Moderate Integration Internal & External Integration: Supply , R&D, Logistics, Operations, Engineering, Marketing, Customer Service
Basis of Competitive Advantage
Coordination & Synchronicity
Interconnectedness Relationships & Trus t
Performance Metrics
Speed, Effectiveness Monitor Supply Environmen t
Performance Metrics
Speed & Integration, Design Supply Base, Integrated Supply Strategy
Knowledge Understand Industries, Supply Base
Supplier Relationships
Transactional, Collaborative, & Alliance
Time Focus Pro-Active To Custom e r
Environmental Pro-Active as Market Differentiator for Custom e r
+S+Cx
Change+
Speed+
Complexity
1970 1980 1990 2000 2010
Stage 3Supply ChainManagement
Stage 2Procurementand ContractManagement
Stage 1Purchasing and
ContractAdministration
2006
Stage 4Value ChainManagement
Stage 5Value NetworkManagement
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Stage FIVE - Systemic Behaviors STAGE 5. Systemic Behavior VARIABLES Value Network Managemen t
Value Driver
Total Value Impact Innovation Costs Revenue Speed
Financial Impact
Present & Future Revenue Bottom Line impacts Supplier & Stakeholder Impact
Integration Level & Functional Elements
Full Internal & External Integration: Supply, Procurement, Logistics, Operations, Engineering, R&D, Sales, Marketing, Service, Customer’s Strategy
Basis of Competitive Advantage
Hyper-Competition Technology Hybridization Speed, Innovation, & Customization
Performance Metrics
Innovation, Synchronicity Synergy Monitor Customer Environment
Performance Metrics
New Processes, Systems Solutions
Leverage Supplier Technology
Knowledge Customer’s Future Needs Industry Trends Connectivity
Supplier Relationships
Multi-Dimensional Collaborative, Networked Vision & Values Bas e d
Time Focus Pre-Active with Custom e r
Environmental Pre-Active with Customer to Reengineer as Added Value
+S+Cx
Change+
Speed+
Complexity
1970 1980 1990 2000 2010
Stage 4Value ChainManagement
Stage 3Supply ChainManagement
Stage 2Procurementand ContractManagement
Stage 1Purchasing and
ContractAdministration
Stage 5Value NetworkManagement
2006
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Harmonization: Toward Relationship and AllianceManagement
CustomerRelationshipManagement
SupplierRelationshipManagement
1
CustomerRelationshipManagement
SupplierRelationshipManagement
2
Alliance andRelationshipManagement
3
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Toward Systems Simulation Capabilities
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Adopting a Process View of The Business andthe
Value Chain
Behavioral Processes
DecisionMaking Processes
CommunicationsProcesses
OrganizationalLearningProcesses
Change Processes Change ProcessesChange Processes
Work Process
Work Process
DecisionMaking
Processes
Communi-cations
Processes
OrganizationalLearning
Processes
TIME
Moving From Functional Silos to Process-Focused ProjectTeams
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Contact Information
Jim Reeds Address
767 Santa Barbara Road,Berkeley, California 94705USA