Category Archives: Change Leadership

AI, Change Leadership

New Mindset – 2025 Adventure

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After a period of recent introspection where actual AI procurement project progress versus hype expectation continues to be a challenge, there has been a forced rethink of the mindset required to maintain a steady course.

Many of us, myself included, prefer a structured approach akin to ‘a journey’. We are driven by a vision, an end-destination, with a plan including appropriate stop off points to recheck and validate whether we are on-track, with periodic course corrections to ensure that we feed-in new data, as applicable, to adjust the approach.

In today’s environment, it seems that organizations are failing to maintain a steady course. Fueled by a high level of business uncertainty, the experience is extremely unsettling and demotivating.

Progress can be a positive experience if managed well, however the disconnect is exacerbated if there is a lack of credible use case, questionable and inconsistent leadership and inability to translate the vision into execution. Accordingly to Rand research (The Root Causes of failure for Artificial Intelligence Projects and how they can succeed, Aug 2024) 80% of AI investments are destined to fail; twice the rate of failure of IT projects that do not involve AI.

Having attended a recent AI in procurement ‘thought leadership’ session, it leads me to conclude our industry pundits have little actual evidenced tangible outcomes. Typical statements such as the below send a mixed message:

  • We think …. improved automation
  • We believe …. new solutions we cannot imagine
  • We estimate …… improved data analytics
  • We forecast ….. a change ?!

My main concern is that there are few actual use cases that have been successful. Either most remain as work in progress or if successfully completed, business’s are keeping them under wraps. The conclusion, whether we go ‘left’ or go ‘right’, is to adopt a different mindset and instead consider the journey as an adventure. Just do not believe it’s a done deal!

Disagree. Collaborate and share your AI use case success. Otherwise enjoy the ride and have fun!

Change Leadership

Bold

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ADJECTIVE

  1. (of a person, action, or idea) showing a willingness to take risks; confident and courageous.

Do we consider Procurement bold or risk averse? In risk averse organizations, the desire to avoid failure overrides the desire to achieve good outcomes (Lopes, 1987). An old debate suggested that Procurement’s risk aversion is limiting it’s ability to deliver value in the public sector (Public Spend Forum Exchange 2017). This risk aversion impacts the ability to find a better way and generate commercial innovation. Too often cultural mindset barriers are formed which are then legitimized through rigid procedures and regulations which in turn leads to further mediocrity. We all get tired of banging our head off the same wall……

Is Procurement bold enough to challenge those established norms and shift the mindset? Or do we sit back and bend to the immovable object that sees creativity as a risk that breaks the rules.

Boldness requires a wealth of relevant experience , and a level of confidence that comes from knowing your stuff! The question is how we change mindsets as today’s organizations face more and more regulation. The original study conclusion remains the same: the core issue concerns organizational knowledge, education and training.

For those seasoned Procurement practitioners, are we condoning risk aversion or helping facilitate a mindset change?

<Join the debate>

Change Leadership, Operating Model, Strategy

Do you feel the urge (to innovate)?

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The call to innovate has never been stronger given the current market challenges. The dilemma faced by many organizations is that reality is never simple and often there is a significant mindset block in tackling how innovation requires a change in Operating Model.

The fear of failure, loss of influence or power, lack of control and inability to trust in a guaranteed outcome block changes. How do organizations navigate this?

To truly leverage innovation, you need a plan:

“If you fail to plan, you are planning to fail

Benjamin Franklin

Information + No Insight = No Strategy

No strategy? Leaders need to step up to the call to action and develop a plan to utilize innovation. This plan must address people, process and technology. Hoping technology adoption will happen just through training is over simplistic – what does it mean for the user experience? The innovation needs to deliver a well thought out advantage and resolve the WIIFME (What’s In It For Me) ‘balancing act’ across the end-to-end process. Innovation for innovation sake is not a plan. The strategy needs to be clear, insightful and deliver value.

Investment, leadership sponsorship, ‘A’ team formation are of course the usual prerequisites.

Still keen to to innovate? Establish a super user audience to ensure your strategy is smart. Even the best innovation can result in a ‘hot mess’ which will be considered as a ‘great idea, just badly executed’ if there is no clear understanding of the outcome benefits and process to capture value.

Know your audience! Transform the mindset.

This is Cognitive.

Change Leadership, Strategy

Procurement Pioneers

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Are you a Procurement person in the business, or a business person in Procurement?

For a few organizations, procurement is considered a ‘blocker’ preventing growth and success, and regarded as disconnected from business goals.

Procurement have a level of risk management responsibility, but this should not be applied with total disregard of the needs of the business. Our ability to build a collaborative relationship with the business requires procurement to act as business managers. We are all on the same team and have a common goal to ensure the business succeeds.

Procurement transformation is more than finding the right technology platform, it is changing the mindset and establishing a service centric approach with an attitude to succeed. Too often technology is applied to support a risk adverse, user unfriendly procurement transaction experience. This is a fundamental failure of procurement to understand its true value proposition and leverage the technology in the right way.

This does not mean we should be meek and afraid to challenge the business; our agenda should be to challenge and transform, thereby unlocking 10 x business contribution. Transform requires Procurement to understand the business challenges and pioneer a new approach. Set the vision. Technology enables humans. Become the business enabler! Lead change.

We are Bold, Optimistic, Human-Centric, Pioneering, Responsible.

We are Dreamers Who Do.

Our life is shaped by our relationships, and having recently started a new adventure, I want to thank all those that have enabled me and supported my latest journey.

Change Leadership, Talent

Power Team Squared

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Last week I met up with a couple of my ex-colleagues and was reminded how the power of team was truly awesome.

“Great things in business are never done by one person; they’re done by a team of people”

Steve Jobs

The ability to create and form high performing teams is an indication of great leadership, and whilst we all recognize individual performance and contribution, prioritizing individual performance limits success as a whole.

The opportunity to become a valued team player is personally fulfilling, however organizations have difficulty in quantifying business synergy (the total is more than sum of the parts) success. Giving this measure challenge, individuals tend to be geared towards independent goals. A common organizational pitfall is the way individuals are allocated objectives. Team or project initiatives are set the same functional ‘silo’ business as usual measures – none reflecting the value add of the ‘improvement’ that will materialize across the business as a whole. For example, imagine if a procurement goal was to reduce the volume of accounts payable invoicing issues.

Good leaders understand the need to think holistically, break down the barriers and use the bigger picture to inspire and motivate. Individuals can become frustrated if there is a lack of vision and strategic direction with respect to an overall business outcome – we all need to glimpse the ‘light at the end of the tunnel’ and have our role explained as part of that success journey.

Technology enablement requires cross functional collaboration and it goes without saying that one of the most important ‘success’ ingredients is to align the best talent and have them operate as ‘one team‘. Internal communication and dysfunction remain the biggest hurdle in organizational transformation, and leaders must ‘commit’ to ensure that these initiatives are resourced appropriately, supported wholly, and visibly recognized as being critical to the overall vision.

This is more than sending individuals on team building development courses. To address the challenge in bringing back those lessons into the workplace, great leaders set the agenda to frame team success.

What’s your next BHAG (Big Hairy Audacious Goal)?

Change Leadership, Digital Transformation, Talent

Cook, Eat and Repeat

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This week’s inspiration is taken from Nigella Lawson’s BBC ‘cook, eat and repeat’ recipes, and having now survived the doldrums of the first month, attention is now truly focused on the opportunities ahead.

With the new year comes new resolutions, new budget and a sense of positive energy, digital tech firms are searching for better ways to inspire procurement professionals can leverage technology and avoid failure. One way to remove the fear is to ensure that someone else has tried it before, and discovered what works and what does not.

Unfortunately what makes sense and tastes terrific differs per individual. This distortion means that there is a reluctance to document the recipe. Why? Cook books have a range of recipes, not all may appeal, but they are here to help. Try one, if that does not succeed, try another, Once you have discovered a recipe that works, share the recipe with others. Success is repetitive.

Where to Start

Where do you find that elusive cook book? Find an experienced cook who has developed their own independent cook book, or at least able to access a library; that is well-versed across range of recipes, and capable of assessing what is likely to be attuned to the organization’s taste. Find and establish the recipe that works – it needs a mix and balance to perfect the outcome.

In simple terms, technology implementations follow the same ‘cook, eat and repeat‘ philosophy. Importantly……

Follow the instructions

  1. Use the prescribed ingredients (apple pie without the apple is not apple pie)
  2. Utilize the best ingredients you can afford (leadership, talent, team)
  3. Understand the cooking time (if someone wants a well-done steak but cooks it for 30 seconds, it will not be well-done)
  4. Assess success by arranging tasting sessions (“feedback is the breakfast for champions”)
  5. Sell the fact that you have found a tasty recipe. Others will be keen to have a try!

You might find this cooking analogy too simplistic, however given the successful introduction and adoption of digital technology remains a major challenge, what will you do to explain the process?

Ready, Steady, Cook! The best time to find your success recipe is to start now. Contact Us.

Change Leadership, Strategy

Procurement’s Innovation Dilemma

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>>Evolution of Lap Time<<

F1 cars have become dramatically faster over time, and estimated to be 2x as fast as the original cars.

In recent times, speed improvements have slowed given the rise of ‘competition’ game changers such as safety, fuel economy and stakeholder interests. The goal posts are always moving; the F1 purpose evolved – its values changed.

Purpose of the Past

Sounds familiar? Your organization wants to improve the performance of procurement and ‘raise the bar’, however:

  • Procurement performance is ‘hard wired’ to cost savings –  price becomes an easy measure; cost is much harder to quantify and evidence; and non-cost factors valuation is over simplified to pass or fail
  • Procurement investment targets the sourcing and bidding processes – there are clear tangible wins especially where there is a ‘low bar’
  • Innovation investment is riskier, continues to ‘raise the bar’, but often targets value beyond cost savings
  • Procurement becomes stuck to its traditional ‘hard wire’ output (it is less risky and sits within their existing comfort zone). Particularly where an organization fails to change recognition and rewards; these form passive barriers to change. The ‘bar’ becomes fixed.

A breakthrough is required to avoid the law of diminishing returns.

>>New Purpose required<<

Where you innovate, How you innovate, and What you innovate are Design Problems

– Tim Brown

Using the F1 analogy, there will be a point where organizations need to evolve their purpose; either driven by the customer, regulation or market disruption. It becomes clear when continuing to ‘raise the bar’ that the same organization will need to realign their value and performance measures. This is a common ‘ high bar’ challenge. Of course speed remains core to F1, as costs will be for Procurement >>

Implications for Procurement

  • Procurement no longer have cost savings goals as their only objective
  • New value measures need to be established to reflect an enhanced and changed purpose – this requires a different procurement mindset
  • Innovation programmes enable new purposes. This requires investment, planning,  talent and leadership. Set a ‘why you innovate’ robust vision at the start!
  • Transformation is a business journey involving extensive internal and external change management.  Transformation takes time (typically measured in quarters and years). Tackle roadblocks quickly and stay consistent to the vision.

The game just became more complex. Is your organization changing Procurement’s Purpose?

Change Leadership, Digital Transformation

Dysfunction, Change and Insanity

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We know change is constant, and organizations need to keep current. So why do organization changes happen, yet a number fail to make any real difference? Is your organization addicted to frequent reshuffles? Do leaders understand how to manage change and resolve dysfunction?

Change is not change when people perceive no difference. If an org chart changes, but the way people work remains unchanged, then it is just more of the same. A common mistake is that reorgs are sometimes considered and confused with a business strategy. Reorgs are not a business strategy; they can underpin a business strategy. Expecting different results without a refreshed business strategy – well that’s insanity!

Albert Einstein image and insanity definition caption

Good leadership understands that a systematic approach is needed, not only to understand the how and why, but to prepare a detailed plan > if there is a failure to commit sufficient time, money and resources to support the reorganization then this is a clear indication that the business strategy element is missing,

By drawing a parallel with reorgs, digital transformation programs suffer similar challenges: lack of detailed design, unclear or missing business targets, insufficient investment, and limited understanding of the impact on the way work will change (see my article on the establishment and importance of digital culture).

Does your organization reshuffle or are they committed to resolve dysfunction?

>>Spoiler Alert<<

If the organization wants sustainable change, systems need to be modified to support a changed way of working. The hardest part according to Harvard Business Review 2016 Getting Reorgs Right is to ‘get the plumbing and wiring right’. HBR uses the analogy of leaders driving the car faster with no steering wheel.

As leaders, we need to step up and avoid the temptation to produce an org chart without a corresponding business strategy. Extending the HBR analogy, add the need to have a dashboard to monitor and measure the change (performance and health metrics: speed , fuel consumption etc.), and a navigation journey plan (map).

For digital transformation projects, the same learning can be applied. Start the journey. Gear up!

Happy Thanksgiving.

Are you driving change or a reluctant passenger? Contact Us.

Change Leadership, Digital Transformation

The importance of Digital Culture

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The relationship between humans and technology continues to advance rapidly. For many us, interacting with Siri or Alexa is now second nature, however assuming that individuals will automatically understand and adopt technology is not a given. These developments are creating another set of challenges (and opportunities) for the organization.

Digital culture describes how technology shapes the way we think, interact, behave and communicate, and as technology revolutionizes, there is invariably an impact corporate culture. Being digital savvy is more than just being paperless, it is about being attuned to the opportunities presented to the organization – all of which need considered management.

For example. remote working technology implementation delivered efficiencies, speeding up work and empowering the workforce. The COVID pandemic accelerated the deployment of these remote working technologies and demonstrated that users could be both productive and effective working from home. Post pandemic, having now grown used to these technology benefits, it is not surprising that a large number of users are resisting the call to the return of a 5 day per week office working. It will be interesting to see how the recent Twitter employee backlash unfolds on the scrapping of the working from home policy.

As these technologies become more embedded, building on the previous theme, hybrid (home and office) working becomes a digital cultural norm, and therefore likely to be a standard employment practice to attract new employees into an organization. Organizations that foster and embrace an environment where users can explore, experiment, develop, and benefit from technology innovation lead to a more motivated workforce.

“Putting People first in Digital Transformation” Survey 2021: 66% are optimistic about the opportunities that technology can bring to their career and work.

Ricoh

Further advancements in cognitive technologies that mimic the human brain: perceiving, judging, thinking and reasoning will continue to challenge the digital culture. There is a whole new profession in the making.

Bottom line: It’s not about the technology, it’s about the way people will use the technology. This should be a key assessment when designing and planning your digital transformation.

To bring home the point, here’s a link to footage of two teenagers completely baffled on how to use a rotary phone. It is easy to forget how rapidly culture evolves!! How are you managing change?

From

Rotary analogue phone

To

Does your digital eXPerience have P for People? Contact Us.

Change Leadership, Digital Transformation, Talent

Costing (‘the avoidance of’) Digital Failure

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How do we qualify the cost of failure and reflect this in the business case to underscore the need to invest adequately? There is well documented research on the low success rate of digitalization initiatives, poor adoption and delayed deployments, but little on the actual $’s involved.

In order to better understand the cost dynamics, imagine an iceberg. The visible tip is the smallest part of the iceberg. This is analogous to the cost of software. The largest part is below the water line, often hidden, and is analogous to the cost of the professional services to implement and execute a digital platform. It is not uncommon for the software: professional services cost profile mix to be around 1:9.

iceberg above and below sea

Software 10%

Professional Services 90%

To clarify, digital platforms require end-to-end integration – they are not standalone apps. Given this cost imbalance, getting to grips with the professional services element is critical.

Professional Services costs are determined by skill set rate card multiplied by days effort. For large and complex projects, forecasting skills and effort can be challenging. Taking a leaf from the manufacturing industry, lean and six-sigma practices, I am reminded that:

“Cost is more important than quality, but quality is the best way to reduce cost”

Genichi Taguchi

How do we increase the probability of success? My article ‘Improving Your Digital Transformation Success Rate‘ outlines key factors that an organization needs to address to improve success rates. The downside is the investment required as business cases can be challenging at the best of times.

How do we get value for money? Organizations need assurance that costs will be fixed and controlled. There is a temptation to cut corners and if the true cost of the professional services element is hidden; the business case becomes software centric and likely to become another failure statistic. A better way is to qualify the costs of failure when assessing the scope and level of professional services. What if we need to rework, increase the volume of change requests, write-off work, delay the project, perform more tests, suffer from low adoption etc. ? How would that impact the business case? This cost avoidance argument can be used to balance and justify a broader understanding of a more comprehensive business case.

How do we mitigate and reduce the cost of failure? Allocate the best talent to the initiative, and perform in depth due diligence on any external professional services provider to ensure you get the best quality professional services. Low price, administrative, unskilled resources will have a negative exponential impact and increase the cost of failure (adding to the below the water line iceberg).

Organizations that fail fast, learn fast have inherent capability to adapt and course correct as they ride the wave and are typically those already operating best in class with a high level of maturity. For the remaining majority, digitalization can be complex and daunting. We learn from our mistakes, but sometimes we need it ‘right first time‘. Otherwise, failure becomes extremely expensive.

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