the scm orchestra · the scm orchestra 0 roy anderson managing director, goprocure...

The SCM Orchestra

0

Roy AndersonManaging Director, [email protected]

SourcingTechnologyProcess Funded ModelTail Spend Management

mailto:[email protected]

http://www.goprocure.com/

Perspective

Individual

Education

Passion

Compensation

Career Path

Industry

Location

Work Life Balance

CPO

Budget

Headcount

Skill Sets

Goals

Corporate Expectations

Workload

Technology

Partners

Change Management

2

The CPO Orchestra Leader

3

© 2016 by GoProcure. All rights reserved.4

DATA EXPLOSION

© 2016 by GoProcure. All rights reserved.

In 2016 aloneWe doubled the data in the entire history of humankind through 2015

5

*By Dirk Helbing, Bruno S. Frey, Gerd Gigerenzer, Ernst Hafen, Michael Hagner, Yvonne Hofstetter, Jeroen van den Hoven,

Roberto V. Zicari, Andrej Zwitter. Scientific American February 25, 2017, https://www.scientificamerican.com/article/will-

democracy-survive-big-data-and-artificial-intelligence/?utm_source=pocket&utm_medium=email&utm_campaign=pockethits

By 2027There will be 150 billion networked sensors

https://www.scientificamerican.com/article/will-democracy-survive-big-data-and-artificial-intelligence/?utm_source=pocket&utm_medium=email&utm_campaign=pockethits

THE AMOUNT

OF DATA WILL

DOUBLE EVERY

12 HOURS


ZB = zet·ta·byte

202713 ZB/year


What is a Zettabyte

8

Equivalent to:

Every person on Earth tweeting for 100 years

or

125 million years of your favorite 1 hour TV show


The Transformation Roadmap

Long

term

busin

ess p

lans

Decisio

n Poin

t

Supplie

r Risk

Manag

ement

Supplie

r Innova

tion

Supplie

r Colla

boratio

n

Stra

tegi

c Sourc

ing

RFP Purchas

e Ord

er

Invo

ice

3 years 2.5 years 2 years 1.5 Years 1 year 180 days 90 days 30 days 30 days late

The transactional space The next generation strategic space

Internal Team Focus

PROPRIETARY AND CONFIDENTIALPATENT PENDING

7 Habits of Highly Successful People by Stephen Covey and animated by Fight Mediocrity,

Big Ideas for a Better Life


Is your Team Transactional or Driving Innovation?

A simple exercise to track how team members spend their time over one work day.


12

The Patriot Missile System

2 years to develop a 2nd source

First shipment


13

Lesson # 2

14


15

The Person with

the Gold

Makes the Rules


Electronic Data Interchange

16

GET IN FRONT OF

TECHNOLOGY

OR

GET RUN OVER BY IT


Farming*

19206.5 million farms

32 million Americans, 30% of the population.

Output value $27B (inflation adjusted to 2016)

18

*American Experience . Troublesome Creek | PBS www.pbs.org/wgbh/amex/trouble/timeline/

http://www.fb.org/newsroom/fast-facts, AFBF’s Food & Farm Facts book

20162 million farms

6 million Americans, 2% of the population

Output $353B

ResultLoss of 81% of workforce

An increase of output value $326B (13 fold increase)

http://www.pbs.org/wgbh/amex/trouble/timeline/

http://www.fb.org/newsroom/fast-facts


Algorithms Rule*

70% of all financial transactions are performed by algorithms

By 2027Half of today's jobs will be threatened by algorithms

40% of today's top 500 companies will have vanished

19

*By Dirk Helbing, Bruno S. Frey, Gerd Gigerenzer, Ernst Hafen, Michael Hagner, Yvonne Hofstetter, Jeroen van den Hoven,

Roberto V. Zicari, Andrej Zwitter. Scientific American February 25, 2017, https://www.scientificamerican.com/article/will-

democracy-survive-big-data-and-artificial-intelligence/?utm_source=pocket&utm_medium=email&utm_campaign=pockethits

Nothing New33% of Fortune 500 companies in 1970, had vanished by 1983, either acquired, merged, or broken to pieces.”

Arie de Geus, The Living Company, Longview, 1997

https://www.scientificamerican.com/article/will-democracy-survive-big-data-and-artificial-intelligence/?utm_source=pocket&utm_medium=email&utm_campaign=pockethits


Automation Across Occupations

Activities accounting for 46 percent of US workers’ time could be automated using already-demonstrated technologies

21

Harnessing automation for a future that works, McKinsey Global Institute, January 2017A road map for digitizing source-to-pay, April 2017, McKinsey& Company

Automated46%


Current Revolution

Robotic Process Automation (RPA) uses simple rules to emulate repeatable tasks (place orders, pay invoices)

Machine-learning algorithms, handle tasks that involve complex rules and requires some form of pattern recognition to be executed correctly. (Spend Analytics)

Smart work-flow technologies can link tasks conducted by different people and machines into a coherent process with well-defined handoff (RFP)

Natural-language-processing (NLP) technologies process textual data and provide a convenient way for purchasers to document requirements without resorting to drop-down menus or structured lists. (Hey google)

23


RPA Potential

~64% Savings

~19% Savings

ON

Shore

Cost


Source: Harnessing automation for a future that works, McKinsey Global Institute, January 2017


Process Sub Process RPA AI Cognitive Analytics

Purchasing Requisitioning & Approval X X X

Contract uploads X

Vendor Creation X

Catalog maintenance X X X

Requisition allocation

Accounts Payable Supplier Master X

Invoice Entry, Matching X

Payments X

Sourcing Spend Analytics X X X

Market Intelligence X X

Spot buy, RFx Set up X X X

e-Auction set up X X X

Bid analysis X X X

Tail Spend Management X X

Supplier Management X X X

Governance Process Policy X X X

Audit X X X

Performance Management X X X

Compliance Management X X X

Reporting X X X

Category Management X X

Risk Management X X 26


Strategic Planning Assumptions

By 2020, automation and smart machines will reduce employee requirements in business shared service centers by 65%.

27

Gartner: Start Preparing Now for the Impact of AI on Procurement Published: 27 March 2017


“The first step towards getting somewhere is to decide that you are not going to stay

where you are.”

-Chauncey DepewAttorney for Cornelius Vanderbilt's railroad interests, president of the New York Central Railroad System,

York from 1899 to 1911.

28

START FROM ZERO


This work has to be done,

BUT

It does not have to be done by you.

31


Objectives

Zero transactional work

Partner with Internal Customers Early

Drive Supply Chain Innovation

Extreme Value Creation

Valued Participant in Corporate Decisions

32


Zero Transactional Work

Work with PartnersDrive technology

Deliver transactions

Use process funded modelsReal Estate

Travel

Advertising

Procurement

33


Partner with Internal Customers Early

Right SkillsBring the skills your customers do not have

Able to talk with them

At the right level

Embedded with your internal customers

34


IS INNOVATION IN YOUR GOALS?


36


If you are not prepared to be wrong you will never create something original.

37

No. 1 Ted Talk, Says that schools are killing our creativity.

Views: 48 millionhttps://www.ted.com/talks/ken_robinson_says_schools_kill_creativity

Sir Ken Robinson

YOUR VALUE IS YOUR

SUPPLY CHAIN


How We Measure Procurement Value

Last Century

Last Decade

Current Effort

Next Generation

Corporate Executive Board 2013

The Evolution of Procurement Performance.pdf


CREATE A DIGITAL

SUPPLY CHAIN

IoT, Digital, Connected, Cloud

41

https://www.rs-online.com/designspark/when-the-blockchain-technology-meets-the-internet-of-things

https://www.rs-online.com/designspark/when-the-blockchain-technology-meets-the-internet-of-things


BE A COURAGEOUS

CHANGE AGENT

GLENN LLOPIS,

ENTREPRENEUR, AUTHOR

PEOPLE ARE AFRAID OF CHANGE

44

William PollardEnglish - Clergyman 1828 - 1893

Supply Chain Talent Crisis

45

http://access.van.fedex.com/slideshow/2016-access-25/critical-link-the-global-supply-chain-talent-gap/

http://access.van.fedex.com/slideshow/2016-access-25/critical-link-the-global-supply-chain-talent-gap/


46

PROPRIETARY AND CONFIDENTIALPATENT PENDINGPROPRIETARY AND CONFIDENTIAL

The SCM Orchestra

47

Roy AndersonManaging Director, [email protected]

SourcingTechnologyProcess Funded ModelProgram Management

mailto:[email protected]

http://www.goprocure.com/

the scm orchestra · the scm orchestra 0 roy anderson managing director, goprocure...

Documents