IBM Empower 2016 Tweetchat: What Is Innovation In Procurement?

Although I was unable to attend Empower 2016 in person, IBM reached out to me as a Top 50 Futurist to join fellow procurement thought leaders on a Live Tweetchat to talk about Innovation In Procurement.

You can throw your hat in to the proverbial discussion ring and share your thoughts on what Procurement Innovation really means, by clicking on the image below or using the hashtag #NewWaytoSource.

It promises to be a lively and thought-provoking discussion.

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IBM invite to join their Futurist Community; Honored to be one of the 50!

I received an invitation from IBM to join their Futurist “think tank” community.

This Community consists of 50 handpicked industry leaders selected based on their field expertise, social presence, and engagement in the Commerce conversation, including supply chain and procurement.

They indicated that they reached out to me because they have been following my coverage of the industry, and view me as a top eCommerce expert and influencer, and among the top 6 in terms of evolving procurement practice.

They are flying me down to Orlando the first week of October – all expenses paid, to participate in a round table discussion with other thought leaders. Needles to say, I am honored and grateful for the opportunity.

I am also excited about being able to connect with other industry thought leaders so that I can add even greater value and expanded insight to the contents of this blog.

Stay tuned.

In the meantime, follow the IBM Futurist Community on Twitter with #NewWaveToEngage

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Why I Joined The Revolution

Stand Up. Speak Out. Drive Change.

This is Kelly Barner’s and Philip Ideson’s call to join the revolution . . . the Procurement Revolution.

We are not talking about just a snappy tagline here with a great logo. When Barner and Ideson talk revolution they are using real fighting words. They are talking about the need to reshape our profession and industry in a manner that is revolutionary!

While I will let you check out the Revolution website to get all the details as to how you can add your voice to this important movement, I want to share with you my reasons for joining the Procurement Revolution.

To start, and with a list of over 30 industry notables signing on to share their ideas and visions for a better procurement tomorrow, I believe that this is the first truly collective and coordinated initiative for meaningful change in our profession. It is not an event within the framework of the status quo, but perhaps the beginnings of a seismic shift.

Sure there have been individual or lone voices here and there such as yours truly, who have been willing to speak up in the face of establishment criticism . . . although I still consider being called the Fenimore Cooper of procurement blogs by one industry pundit an honor.

What is even more interesting than the names of those who have joined Kelly and Philip’s revolution, are the names of those which are absent. Could this be an indication that one time industry insiders and perceived thought leaders are now the one’s on the outside looking in? After all, who would not want to be part of such an important discussion?

This of course is the perfect segue into my second reason for joining the revolution . . . no sponsors = no outside influences.

For years the procurement world – and more specifically, the industry’s media, have more often than not, been the paid voice of the service provider community. In other words, the only perspective that was ever really presented, was from a single point of interest.

This doesn’t mean that members of the service provider community are not welcome. It simply means that they will no longer have the sole or dominant voice. This is good for everyone in that through a truly collaborative dialogue, we can all collectively realize our greater aspirations.

In short, it’s time that we procurement professionals take control of the podium of our own futures, and in the process become the definitive voices in our own industry.

Now that’s a R-E-V-O-L-U-T-I-O-N!

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Finding Evidence That Shows Candidates’ Seriousness About Procurement

Special thanks to Charles Dominick, SPSM3 of the Next Level Purchasing Association for this guest post.

In the my previous post, I talked about ways to structure a job description to help find a rock star of a procurement employee by focusing on the qualifications you need and the qualifications you want.  However, let me caution you now that qualifications alone may not be enough.  You may deserve a candidate who not just knows procurement, but loves procurement.

How do you know if a candidate loves procurement?  Three pieces of evidence that suggest it:  contributions to the profession, intra-profession mobility, and certification.  We’ll explore each of these in this post.

Contributions To The Profession

Lots of people have occupied procurement positions.  According to the US Bureau of Labor Statistics, there are nearly a half-a-million people in the US who are buyers and purchasing agents.

Some of those half-million people are making a difference in their roles.  Others are pretty much taking up space.

Those who are making a difference also recognize the need to make a name for themselves, both internally within their organizations and externally within the procurement community.  After all, if a cost savings tree falls in the procurement forest and no one is around to hear it, did it make a sound on the bottom line?

Those difference-makers speak at procurement conferences.  They author articles in trade publications.  They post questions and answers on the many LinkedIn Groups aimed at procurement professionals.

In other words, they don’t succeed in isolation.  They contribute to the profession.  And those contributions provide excellent evidence that a candidate is serious about procurement and likely to stick to it for the long-term.

Intra-Profession Mobility

Personally, I took a purchasing course in college.  I loved it.  I sought out – and found – a procurement position as my first job after graduation.  I haven’t left the procurement profession in the 20+ years since!

But it’s no secret that cases like mine have been the exception moreso than the rule.  Even with many colleges now offering degrees in supply chain management, millennials aren’t necessarily seeking out procurement roles as universities tend to consider disciplines like production control and logistics to be at least as important pieces of supply chain as they consider procurement to be.

So, again, just because someone has been in procurement doesn’t mean that they targeted that role and got exactly what they were shooting for.  But, if a candidate has a track record of staying in procurement even when they get new jobs, they may just love procurement.

Certification

A final indicator of a candidate’s seriousness about procurement is whether or not he or she has a procurement certification.  Unlike a college degree, which is likely to be highly generalized – “business administration” is a bit broad, isn’t it? – a certification in a profession shows that a candidate is truly interested in being a specialist.  A procurement certification demonstrates that a candidate:

• Has learned some of the most strategic procurement practices
• Has met third party standards for excellence in the profession
• Is serious about procurement as his or her lifelong profession

 Make “Seriousness” About The Profession A Qualification

Now that you understand the importance of a demonstrated seriousness about procurement, you need to institutionalize it as a qualification on your job descriptions.  Phrases like “Visibility as a thought leader highly desirable,” “Progressive experience in procurement a plus,” and “SPSM Certification preferred” can help you attract higher-level talent.

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A Questionable Quote

Everywhere I turn lately I am seeing quotes from anyone and everyone, so I thought that I would jump on the bandwagon from a procurement standpoint.

Are these wise words I am am sharing based on my many, many, many (well you get the idea) . . . years of personal experience?

While I can’t attest to the wisdom of the words, I can tell you that they are what I honestly think.

Anyway, here is my questionable quote for today . . . tell me if you agree or disagree.

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Confidential Information, Trade Secrets and The “Use” of Non-Disclosure Agreements

Last week was very interesting – okay, every week is interesting – but last week in particular.

On three separate instances I was made aware of attempts to circumvent the Freedom Of Information Act under the auspices of protecting proprietary information or trade secrets, the possible release of confidential information, and the frustration of sources who want to speak out, but are muted by non-disclosure agreements.

The concern I have with the above examples, which are probably the tip of a very large iceberg, centers around the question; is the public’s right to know being trumped by the self-serving interests of a select few?

“A consent decree the British firm reached in 2011 settled civil claims over violations of U.S. arms export control laws and regulations. The $69 million civil settlement followed a criminal guilty plea from the company the preceding year, resulting in a fine of $400 million.” – BAE Systems moves to enter State Department FOIA fight By JOSH GERSTEIN, 08/11/16

Take Josh Gerstein’s article regarding BAE Systems’ efforts to limit the Associated Press’ access to documents surrounding both the civil and criminal cases against British Aerospace.

As Gerstein reports, BAE Systems plc, a British company, and BAE Systems Inc., its U.S.-based affiliate, who are “successor firms” to British Aerospace, filed a motion in Federal Court this past Thursday. In it they claimed that the publication of the details of a settlement between the company and the State Department would result in their suffering “harm from the public release of their proprietary information.”

As further justification for their motion, the companies presented the argument that preventing AP from gaining access to this information, “would ensure the continued integrity of the regulatory process which relies upon the free, open, and voluntary transmission of sensitive information between the regulator and regulated entities.” Conversely, the failure of their motion to prevent the AP from obtaining and publicizing said information, could “discourage businesses from entering into settlement talks in similar cases.”

In short, if the companies are forced to turn over the requested information, it would hinder their ability to be open and transparent with the government in the future. Alternatively, if the companies’ motion is granted, they don’t have to be open with the public. Either way, getting to the truth is a complex and burdensome undertaking.

This raises an interesting question . . . why would or should the public care about the BAE case? After all, how does this case – and cases like it, have a direct impact on our lives.

For what it’s worth, my answer to that question goes beyond simply exercising our right to know.

Edmund Burke coined the phrase “The only thing necessary for the triumph of evil is for good men to do nothing.” The problem is this . . . you can’t act if you don’t know.

In other words, it is the act of not knowing, of not asking the questions that need to be asked, that pose the greatest risks. When transparency and the access to information is compromised or restricted, you are left in the dark. This leaves you potentially vulnerable, in that what happened to someone else, could also happen to you.

Consider the following example from the world of procurement, and the NIGP #CodeGate story.

Let’s say the story of what happened in Missouri never came out? What if the actions of the NIGP and Periscope went unchecked and unchallenged? At the time, it may have only mattered to Missouri and perhaps the winning vendor – Perfect Commerce. But here is the thing, if there hadn’t been a disclosure at that critical juncture, and things were allowed to progress as they could have, how many other states (and municipalities) might have been subjected to a similar experience? At best, and under this scenario, the process of selecting and awarding a contract to a competing service provider would have possibly become a litigious battle of wills. At worst Periscope – with the assistance of the NIGP – would have cornered the public sector market through their control of the NIGP taxonomy.

The NIGP’s continuing refusal to release the findings of an internal audit that came about as a result of the #CodeGate story, only fuels speculation that something is seriously amiss at the non-profit organization. Otherwise, why not provide the media with a copy of the audit?

This is what makes our right to know a NEED TO KNOW, and why we need to challenge any efforts to conceal the truth regardless of where and when it happens.

Anyway, that’s my take, what is yours?

By the way, why should BAE’s predecessor company’s export control violations matter to you? Have a read of the following 2015 U.S. Department of Commerce paper titled “Don’t Let This Happen To You.”

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Truth In Procurement Part 2

Apparently Part 1 of my interview on Bill Culhane‘s terrific radio show broke listener records, so tune into part 2 and let me know what you think . . . (for Canadian listeners, you can hear the segment on Spreaker at https://lnkd.in/e-ZDtv7)

Going wherever the Truth leads. Also, the Cubs are leading and Bed Bugs will be losing.

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A Grimm Response?

Yesterday I reached out to NIGP CEO Rick Grimm in an e-mail, asking for a comment on my most recent post (Does an apparent lack of transparency provide enough of a reason to stop using the NIGP Code?).

Here was his response:

Mr. Hansen:  The Institute already provided you with a response to your query regarding our internal audit on April 5, 2016 – over 4 months ago.  I am bewildered why you believe that your same question would evoke a different response.  In alignment with our commitment to transparency, our members received an update on the actions taken as a result of the audit. To be clear, this reply to you should not be interpreted as an opportunity to re-engage with you.  It is simply an affirmation of our position articulated to you in April 2016.

Rick Grimm

I wanted to get further clarification regarding his reference to a provision of an update, and the subsequent actions that were taken as a result of the audit. So I responded as follows:

Thank you for your reply Rick.

To what update are you referring, and where can I obtain a copy?

Jon

So far, I have not received an answer.

Meanwhile, the feedback I received from those with whom I have shared Mr. Grimm’s response, is that he comes across has being angry and defensive.

In this context, and if the above referenced words of former NIGP Board President Donald Buffum are in fact reflective of the NIGP’s values and objectives, then how do you assess (or reconcile) Mr. Grimm’s response?

After all, isn’t a greater level of transparency, a key tenet of the vision associated with the public sector procurement profession moving in the right direction?

What do you think?

Just started following the NIGP #CodeGate story? Use the following link to access the Post Archive; http://ift.tt/1D4xMYc

Follow my coverage of this story on Twitter using the hashtag #CodeGate

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Does an apparent lack of transparency provide enough of a reason to stop using the NIGP Code?

The NIGP’s continuing refusal to turn over what I will call the #CodeGate audit – I refer to it as this because it appears that Procurement Insights’ coverage played a large part in the document’s creation – raises an interesting question.

Should the apparent lack of transparency on the part of the NIGP cause enough of a concern regarding the Code’s management, to warrant a transition to a new public sector taxonomy?

For example, and as reported in this blog, Hawaii made the decision to move to the NAICS code last August, why shouldn’t others follow? By the way, I did put in a call to Sarah Allen, who is the State’s Procurement Administrator, asking for an update on how the transition went. I will let you know what she had to say when I hear back.

The above being noted, and putting aside for a moment the purported complexity associated with making the change, as well as the reported loss of historic data, the real issues may very well be ones of vulnerability and values.

Vulnerability in that who is to say that another Missouri would not happen again in the future, and values, in that how can one teach and preach transparency and professional conduct, if they themselves do not practice it. With the latter I am of course talking about the NIGP’s pervasive role in educating and certifying public sector procurement professionals.

Somewhere along the line, if procurement is to gain true creditability and its coveted seat at the executive table, the profession has to demonstrate a non-conflicted moral high ground, that builds both trust and confidence. Simply following the route of convenience and familiarity will not carry the day.

Based on what we have learned over the past 18 months, I am not sure that the NIGP is one of the organizations who can legitimately carry the industry banner for the advancement of our profession. At least not until it practices what it preaches.

What do you think?

In the meantime, and with thanks to organizations such as The First Amendment Foundation, we are now pursuing multiple avenues through which we can hopefully obtain a copy of the #CodeGate audit.

I will keep you posted on our progress.

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Rat Cats, Puppy Dogs & CHORP and other problems with our industry’s media

A very interesting, and I believe accurate, assessment of where journalism is heading . . . a world where hard news is replaced by soft pieces that offer little if any meaningful insight into what is happening in the real world.

Sadly, the procurement industry’s media has been doing “puppy dog” coverage for some time now . . . this has to change.

Click Image Below To View . . .

What do you classify as “real news”?

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The views expressed in this post and throughout the series are the autor's own and not intended to reflect the views the YQ Matrix platform, its users or any associated organisations.

For the procurement people among you, have a look at the latest YQ Matrix raw material and semi-finished prices. For: Prices on other websites.

NIGP Executive Board: A Forced Silence?

While we continue to work diligently to secure a copy of the NIGP forensic audit through Florida’s Freedom of Information Act (FOIA), there are a number of questions regarding both the executives on the NIGP Board, as well as the NIGP’s current sponsors.

Reports suggest that the audit, which contains a review of the NIGP’s business practices, highlighted several areas of potential problems within the non-profit association’s operations. In this regard, the efforts of the NIGP’s legal counsel to deter me from attempting to obtain a copy of the forensic audit – you can read about it in my April 6th, 2016 post NIGP Counsel: Non-profit organization will not release the findings from the forensic audit . . . – raises a red flag.

What is in the report that they do not want the public to see?

This brings us back to my reference to the questions being raised concerning the NIGP Executive Board and sponsors.

Specifically, and knowing that the members of the NIGP Board have received a copy of the report, how can they remain silent given its findings, and the corresponding #CodeGate coverage?

NIGP Governing Board 2016

• Jack Adger, CPPO, CPPB – Chair

• Michael E. Bevis, CPPO, JD, CPSM, C.P.M., PMP – Chair-Elect

• Taylor V. Adams, CPPO – Treasurer

• Donald G. Buffum, CPPO

• Jeff Cobb – Thought Leader

• Keith K. Glatz, CPPO, FCPM, FCPA

• Stephanie Osborn – Thought Leader

• Denise K. Schneider, CPPO, CPPB, C.P.M.

• William P. Shields, Jr. – Thought Leader

• Miriam Singer, CPPO

• Rick L. Grimm, CPPO, CPPB – Secretary/NIGP CEO

For example, let’s look at Donald Buffum, who is the Director, Procurement & Contracts for Mississippi State University.

The Mississippi Public Universities Accountability and Transparency website page’s opening paragraph reads as follows:

“The Board of Trustees of State Institutions of Higher Learning (IHL) is committed to accountability and transparency for students, parents, faculty and staff, and taxpayers. This accountability and transparency website is a tangible example of that commitment and offers all stakeholders access to important information quickly and easily. All stakeholders play a key role in the success of the university system and help us fulfill our tri-fold mission of education, research and service.”

The website talks about the commitment to “accountability and transparency” and providing “all stakeholders access to important information quickly and easily.”

I have no doubt that Mr. Buffum believes in the need for accountability and transparency. Yet in his role with the NIGP, and the release of the report’s findings, he remains silent.

How about Jack Adger?

Mr. Adger is the Chief Procurement Officer for the Bossier Parrish School Board.

Bossier Parrish uses the eGovernance BoardDocs platform which, among other benefits, increases transparency.

I am also of the opinion that Mr. Adger believes that transparency and accountability is important.

But he as well, remains silent. Why?

In either instance, it can’t be by choice?

While I haven’t yet checked out the other members of the NIGP Board, I would assume that all would be employed with organizations who share a similar view regarding the importance of transparency.

So why are these dedicated, experienced procurement professionals not saying or doing anything regarding the report’s findings?

Even though they may be manacled by a non-disclosure agreement, surely serving the best interests of their profession and the industry as a whole, takes precedence? Surely, and in the face of a possible conflict of interest, the pursuit of the truth carries a greater obligation than an imposed silence?

In short, we need to know the truth, because it serves the best interest of all stakeholders – including taxpayers. Particularly because of the influence and reach of the NIGP.

As is my practice, I will be reaching out to each of these individuals over the coming days and weeks for their comment.

In my next post, I will talk about the problems that the NIGP’s sponsors could potentially face, if the association continues to refuse to release the study’s findings.

Just started following the NIGP #CodeGate story? Use the following link to access the Post Archive; http://ift.tt/1D4xMYc

Follow my coverage of this story on Twitter using the hashtag #CodeGate

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For the procurement people among you, have a look at the latest YQ Matrix raw material and semi-finished prices. For: Prices on other websites.

Is There Truth In Procurement?

CLICK LINK TO LISTEN TO THE LATEST EPISODE

Show Survives a Cancelled Flight. The Voice and Conscience Behind #CodeGate and #Transparency. Protecting a Best Friend

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For the procurement people among you, have a look at the latest YQ Matrix raw material and semi-finished prices. For: Prices on other websites.

Periscope Letter Protesting Arizona RFP Eye Opening

At the end of this post, you will find a copy of a letter dated July 20th, 2016 from Periscope Holdings Inc. CEO Brian Utley, under the heading Protest of Solicitation No. ADSPO17-00006413; Electronic Procurement Solution.

Periscope is challenging the State of Arizona’s decision to issue an RFP for an “Electronic Procurement Solution.” Here is the link to the State’s Bid Solicitation; http://ift.tt/2afdS6q

Over the coming weeks, I will delve deeper into the letter’s contents, and what it means relative to Arizona’s desire to look for an alternative to Periscope’s BuySpeed offering. It should be noted that Arizona has been using the BuySpeed platform since 2009.

However, and while I want to stress that I have considerably more research to do, after a preliminary read of Mr. Utley’s letter, I will share with you my initial or gut reaction.

What Goes Around . . .?

To start, I could not believe what I was reading . . . is this the same Periscope who tried to leverage their relationship with the NIGP to challenge the Missouri contract award? In this regard, points 1 and 2 of Mr. Utley’s letter in particular, jump off the page.

By the way, you can read my coverage of the Periscope NIGP #CodeGate story through the following link; NIGP #CodeGate.

The two posts you will want to initially focus on are December 11th, 2014 – Up Periscope? Examining Periscope’s acquisition of BidSync with a “Survivor’s” eye and, March 31st, 2015 – Periscope Protest Letter Highlights Their Reasons For Challenging Missouri Selection of Perfect Commerce.

Private Versus Public Sector

I do not believe that this kind of protest would wash with a private sector client.

I am not talking about the actual process itself, or for that matter whether or not a vendor would have the right to protest the issuance of an RFP. What I am talking about is the business sense to pursue this course of action.

Besides sounding like sour grapes, the letter comes across as a company trying to bully a state into using their solution. It is as if Periscope doesn’t (or doesn’t want to) recognize the right or expertise of the state’s procurement people to make decisions or pursue courses of action that they feel is in the best interest of the state as opposed to the vendor’s.

Am I missing something here?

An Absence Of Arrogance

Although I have never really encountered a situation in which a vendor challenged the actual issuance of an RFP before now, the tone of the letter seems to be void of the usual vendor arrogance. Specifically the palpable, underlying sense that the vendor believes they know what is best for a public sector entity.

I can’t quite put my finger on it at this point, but there is definitely something different here. Makes one wonder how well Periscope has done in terms of both landing and maintaining new clients, and what the loss of Arizona would potentially mean to the company’s future prospects.

In Conclusion . . . 

There are of course other elements to this story that are just now starting to come through, but at this point, this is my take.

Stay tuned for more updates.

In the meantime, here is the Periscope protest letter:

 

 

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For the procurement people among you, have a look at the latest YQ Matrix raw material and semi-finished prices. For: Prices on other websites.

Separating Requirements From Preferences In Procurement Job Descriptions

Special thanks to Charles Dominick, SPSM3 of the Next Level Purchasing Association for this guest post.

Improving procurement capability can be accomplished in a variety of ways.  I prefer to focus on the people side of procurement capability.

Believe it or not, there is a single document at the foundation of the people side of procurement capability that determines the degree of success the organization will or will not achieve through its procurement people.

What is that document?

It is the job description.

Each procurement position needs a job description.  If you get it right, it will provide a solid foundation for attracting and keeping the right people.  If you get it wrong, it is like a thin, wet, ripped card at the bottom of a house of cards – it will lead to the whole house of cards falling.  Or, in less metaphorical terms, poor job descriptions will make it extremely difficult for you to achieve world-class procurement results for any sustained period of time.

A fundamental aspect of getting your procurement job descriptions right is carefully separating your requirements from your preferences.

When you think about your ideal candidate, you may think of someone with a masters’ degree from an Ivy League university, experience getting results in exactly the category of purchased goods or services to which you’d assign her, every procurement certification available, and an inspiring personality.  It’s good to think big.  Seldom do people who achieve big dreams not dream even bigger.

But when you write the job description you use to recruit your next procurement professional, you may want to be cautious against getting too dreamy.

If you required that candidates have the aforementioned education, experience, certifications, and personality, there may be only a handful of people – or less – in the world who can meet those qualifications.  And they may already be happily employed.  Or living on another continent.  Or expecting compensation three times what you’d be able to pay.

You obviously don’t want every Tom, Dick and Harry applying for your open strategic procurement position.  But you want to cast a wide enough net to give yourself some choice.

So, you may not want your job description to state that qualifications like that Ivy League MBA is “required.”  Instead, you may want to express the qualification as “preferred.”  This may encourage a candidate with the right experience, all of the certifications, and the right personality but only a bachelor’s degree from Harvard to apply whereas they would otherwise be discouraged from applying due to the master’s degree “requirement.”

So, think through all of the qualifications you value and determine if they are truly “required” or if you can consider them “preferred” so that you don’t have to turn away a rock star of a candidate due to a technicality.

In the next post in this series, I’ll share some insights on recruiting candidates that not only have the right qualifications, but are also truly serious about procurement.  Stay tuned!

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The views expressed in this post and throughout the series are the autor's own and not intended to reflect the views the YQ Matrix platform, its users or any associated organisations.

For the procurement people among you, have a look at the latest YQ Matrix raw material and semi-finished prices. For: Prices on other websites.

Procurement Insights Moves Into Mainstream Media

With our final sponsorship commitments ending at the end of this month, Procurement Insights will be a 100 percent sponsor free blog.

While I have always striven to provide thorough and objective coverage, for me accepting blog sponsorship dollars didn’t seem to mesh with true journalism. Or as I would write in my post it is time for procurement to come of age,  any “appearance of favoritism or bias – even where none exists, is unacceptable.”

This is particularly important given the historically close ties between bloggers and the service providers they are covering. As we all know, the majority of the older blogs originated from within the provider community itself. Kudos to these “provider” blogs, as they were among the first to recognize the power of tapping into the emerging social media market.

In some ways, the first blogs are reminiscent of the shows that aired on television when that was a nascent medium.

Remember when there were only 2 or 3 channels to watch? Almost every show became a hit by virtue of a combination of both curiosity for the new medium, and limited selection?

Fast forward to today, and instead of 2 or 3 channels, there are hundreds. Instead of a handful of shows, there are an innumerable number of shows that are accessible 24/7. In short, and with an equally expanding choice for readers, blogs are faced with greater competition . . . and expectations.

This brings me back to why I made the decision to end this blog’s sponsorship program.

My readers and listeners are knowledgeable and sophisticated, and are increasingly tech savvy. In short, and in conjunction with the “commoditization” of procurement technology, you are looking for information and insights beyond a features, functions and benefits analysis. You want to know what makes a company tick. You want to know the people behind an organization – including their service capability and true client results. To do this effectively, I have to cover the industry in an entirely different way. This means that I will on occasion, have to scrutinize the companies I cover in ways that could be difficult to do, if I were dependent on their favor in terms of revenue and other incentives.

Or to put it another way, independence and objectivity go hand-in-hand. As we learned from the Theranos scandal, it is hard to have one without the other.

Now that this initial transition phase has been completed, I am ready to take this blog to a new level . . . mainstream media.

Starting with the Delaware Online News Journal’s coverage of the brewing legal battle between the State of Delaware and SciQuest, I will be expanding the scope of this blog through a collaborative coverage platform. This means that among other things, Procurement Insights will have permission to reprint articles from mainstream media publications in their entirety. It should be noted that Delaware Online is part of the USA Today Network.

It also means that where it makes sense, there will be shared research and collaboration on stories. This will provide you, my readers, with a broader news scope that includes perspectives on stories from those outside of the industry.

Over the coming month’s we will be announcing new collaborative engagements, as well as a tie-in to my radio show on Blog Talk Radio.

All-in-all, this is a an exciting time in that objective coverage of our industry that is unencumbered by financial ties and revenue dependence, is long overdue.

Furthermore, a collaborative coverage platform in which mainstream media can access resources and industry insights that may not have been previously possible, will elevate procurement’s profile to a larger and more general audience.

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from Procurement Insights http://ift.tt/2aorfS4
This content was assembled for you by the YQ Matrix platform

The views expressed in this post and throughout the series are the autor's own and not intended to reflect the views the YQ Matrix platform, its users or any associated organisations.

For the procurement people among you, have a look at the latest YQ Matrix raw material and semi-finished prices. For: Prices on other websites.

Court ruling in SciQuest action means that necessary questions regarding company can still be asked

In my May 31st post Why Is SciQuest Afraid To Go To Court, I shared with you the news that the company had filed a motion to have my defence stricken because I was unable to pay $22,000 in legal fees.

The legal fees came about as a result of my failed motion for a change of venue from Ontario. An important reason behind my filing that motion, was to do everything that I could to protect the identities of my many sources. The sources, which number more than half a dozen, provided everything from documentation and audio/video recordings, to access to senior company executive insights. In short, they are the true heroes behind my coverage of SciQuest, because without their willingness to come forward, I would have never been able to ask the important questions that need to be asked, regarding the company’s operations.

The other day, I received word that the courts had denied SciQuest’s motion to strike my defence, and have provided me with an opportunity to pay the legal fees in more manageable monthly increments over the next 3 years. Don’t get me wrong, The $22K does not include my legal costs for my own lawyers, but no one said that the pursuit of truth would be easy or free. In this regard, and if so moved, you can contribute to the cause through my Go Fund Me campaign. My hope is to raise $2K per month – which means that even the smallest donation will make a difference.

So now that my voice has not been silenced, there are new developments that need to be addressed including what happened in Delaware.

According to a July 13th delawareonline article by Scott Goss, the State is asking the court to “force” SciQuest to complete a $2.3 million software contract. If the State fails in its action reports Goss, then Delaware taxpayers could be on the hook for nearly $2.3 million for a “procurement website that may never function as originally envisioned by state officials.”

According to the article, SciQuest has filed counterclaims arguing it met every contract requirement and more.

Now in and of itself, and without further information, one could reasonably conclude that this is an isolated incident. Or as SciQuest CMO Karen Sage commented in my June 22nd, 2015 post, lawsuits are not “prevalent” but that “it does happen in all companies.”

You may be wondering what prompted my exchange with Ms. Sage?

The reason is quite simple . . . I was asking for a comment regarding a breach of contract suit filed by  John Muir Health, which has it turns out made somewhat similar claims to those of Delaware.  I also asked about the company’s action against the West Virginia Network for Educational Telecomputing (WVNET).

As with my previous requests for comment regarding other matters, the company was unable to shed any additional light on the above referenced actions beyond Ms. Sage’s brief Tweets.

By the way, the John Muir Health Claim was settled on April 27th, 2016, a little more than 1 month before the AKKR acquisition of SciQuest was announced. You can access all of the court documents through the Pace Monitor website at http://ift.tt/1ogiHMM. Simply enter SciQuest in the search box.

However, are two or even three actions enough to demonstrate a possible pattern?

In my August 26th, 2015 post I wrote about how UConn spent $902,000 on software licensing fees it didn’t use, as well as how Ohio would be dropping SciQuest due to among other issues, the position that the company’s method for catalog creation and maintenance is both complicated and costly. Ohio did in fact stop using SciQuest as reported on April 26th, 2016.

In the same August 26th article, I had also written about SciQuest losing both Dartmouth and Stanford has customers.

The above are all facts based on research, media coverage and the insights provided by my various sources.

However, let’s dig even deeper, by revisiting my September 6th, 2015 post A Material Change at SciQuest?

In that article I had made reference to the concerns raised by one analyst covering the company, about the possible implementation challenges that led both Oregon and Colorado to cancel their contracts with SciQuest.

Based on the information that was received from sources within SciQuest – including an audio/video recording of the company’s Q2 Scoop session at the end of July 2015, the problems with implementations and growing client dissatisfaction appear to be wider spread than initially thought.

An audio excerpt in which SciQuest’s CFO Jennifer Kaelin made the statement that “we’ve constantly heard from customers that integrations are too timely and costly to them” is compelling.

CEO Stephen Wiehe’s recorded comment that “we’re still playing a little catch-up with the development and products that we’ve got we’re going to shift to high gear into more of an offensive mode” is also noteworthy, as is his statement that “we’ve made some great progress in reducing implementation times . . . working on how to install this in weeks and days, rather than months and quarters.”

There is more.

According to the documentation provided by one inside source, a considerable number of clients had stopped using SciQuest, including Purdue. The client losses in its indigenous higher education and government markets can’t be ignored.

Even though these client losses did not lead to a lawsuit, it should still raise a red flag for prospective clients going forward. In this context, I wonder where the post AKKR acquisition announcement regarding SciQuest’s introduction of the PartnerSelect Program comes into play? I will delve into this point in greater detail in an upcoming post, including the SciQuest – Huron Consulting Group partnership back in 2006.

Coming back to Delaware . . . is it an isolated incident, an exception to the rule? Is Delaware an unreasonable client placing undue demands on the company or, are Delaware’s issues indicative of a long-standing, systemic problem?

As with everything that I have written, I would invite you to do your own research regarding the above, and draw your own conclusions.

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This content was assembled for you by the YQ Matrix platform

The views expressed in this post and throughout the series are the autor's own and not intended to reflect the views the YQ Matrix platform, its users or any associated organisations.

For the procurement people among you, have a look at the latest YQ Matrix raw material and semi-finished prices. For: Prices on other websites.

Theranos Update: “Celebrity” Boards And Their Negative Impact On American Business

When I read the following excerpt of Michael Fertik’s post Elizabeth Holmes and the Burden of (Social) Proof, the name Conrad Black immediately came to mind:

“Holmes did what many entrepreneurs do, often with positive effect: brought together smart, known people to build the board and leadership team. She surrounded herself with an original board configuration guaranteed to lend gravitas and surface-level credibility to the company, including former Secretaries of State Henry Kissinger and George Schultz, and former CDC director William Foege.”

Why do we constantly buy into names and images as opposed to facts and doing our own homework?

Note the following excerpt re Black’s board, and who’s name was also listed as a director:

Indeed, the roster of independent directors reads like the politically plugged-in guest list at an American Enterprise Institute dinner—not the managerial crowd you’d find at a Business Roundtable function. There’s former Secretary of StateHenry Kissinger (a director since 1996), who would seem to have little insight into the business challenges facing a newspaper company—think newsprint prices, union contracts, the impact of the digital era on newspapers. (Strategic bombing of media competitors, after all, is typically not an option.) He evidently agreed: While the Board met four times in 2002, the proxy notes that “Mr. Kissinger did not attend 75% or more of the aggregate of the total number of meetings of the Board of Directors and the total number of meetings of the committees on which such director served.” In other words, in exchange for his $35,000 director’s fee,Kissinger attended at most one meeting—and possibly none.

Of course we all know what happened with Black’s Hollinger International empire. If you have forgotten or are perhaps too young to remember, you can read about Black and his fall from grace on Wikipedia;  http://ift.tt/1UMKvbI

Sadly, and like Larry King – who has done late night infomercials for everything from BreathGemz Breath Fresheners to Omega XL Fish Oil Pills – the latter within the context of a legitimate news interview – many are simply selling their names and associated creditability.

Wake-up people!

Celebrity boards do not bring any real expertise or creditability to a corporation and its products or services. At least we should not automatically assume that they do.

We have to become more scrutinizing as investors and consumers, otherwise scandals such as Hollinger and Theranos will continue to prove the old adage that if we don’t learn from history, we are doomed to repeat it!

Not Everyone In Procurement Agrees With Me . . .

Vivek Sood, who is an Investor, Managing Director – Global Supply Chain Group, Keynote Speaker – “Mr Supply Chain” and Awarded Author, did not necessarily agree with my above assessment.

In a comment Mr. Sood shared on my original LinkedIn post, he said the following: “Why blame the board for management failures?”

My response?

“It is, and I quote one of a myriad of sources, “the role of the board of directors to hire the CEO or general manager of the business and assess the overall direction and strategy of the business.”

Furthermore, and quoting yet again another source, “the board is directly responsible for protecting and managing shareholders’ interests in the company.” In short Vivek, being a member of a board – a real board – carries with it a great deal of responsibility beyond being a showcase of famous names.”

In making the above statement, I believe that boards are not there to serve the wishes of the CEO, but to hold them accountable.

While Theranos is an extreme example of a board’s failure to live up to its fiduciary responsibility, I fear that this scenario is far more common than we would like to think or believe.

What is your take?

What role do you believe a Board of Directors should play in overseeing the best interests of a company and its shareholders?

Check out my other posts on Theranos here: http://ift.tt/21pozEm

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This content was assembled for you by the YQ Matrix platform

The views expressed in this post and throughout the series are the autor's own and not intended to reflect the views the YQ Matrix platform, its users or any associated organisations.

For the procurement people among you, have a look at the latest YQ Matrix raw material and semi-finished prices. For: Prices on other websites.