Environmental knee jerk reactions...

OK, maybe as I get older I have gotten a little more contemplative. I focus on the long term, look at all the possibilities and then try to strike a balance between some short term gains, but building towards a sustainable future. And by sustainable, I don't just mean "green" -- because the true meaning of sustainable is to "support, hold up and endure without yielding." The word was hijacked by the environmental movement and certainly has applicability. Yet in business, it has always meant making sure that the decisions that are being made will "hold up" and be relevant in the long term.

When you look at the "green" sustainability movement, I'm wondering how many of the corporate and government decisions that are being made will actually stand this test of time. Because you see, from my perspective, many of the decisions that are being made (and note this is my opinion only) with the emphasis on how much of a media splash can you get so that everyone looks with adoration on the green halo above your head.

So a few examples. Yesterday, with great fanfare the Premier of Ontario announced that beginning in July 2010 the provincial government will provide a rebate of upwards of $10000 to anyone purchasing an electric car. Yet from my perspective, although getting a great deal of media coverage, I'm thinking why? Firstly, this is obviously a rebate for those who can afford a vehicle which will cost upwards of $40K, leaving out a significant part of the population who cannot partake of the premier's generosity. However, I thought and maybe I'm naive here is that the idea was to get more vehicles off the roads, because in Toronto as well as cities around the globe do not have the infrastructure to support more vehicles. So if there are programs to buy more cars - even if environmentally friendly - that means that more roads need to be build, meaning that all those non-environmentally friendly dump trucks, bulldozers and the like need to be used, and the wonderful aromas of tar and fresh asphalt wing their way into the stratosphere.

The cost of this program is potentially of $3Billion -- so I ask myself, why wouldn't we try to put this money into public transportation systems that span effectively out to suburbs of major cities? I would love to have take the commuter trains into the city, but because of their unreliability and minimal service in my corridor, I don't.

So I'm just wondering how this "green" program is actually helping the environment.

What else? Plastic bags. Please let me start this by saying I'm in favor of bringing my own bags. This has been a standard in Europe for years and truly it only makes sense. However, the big fanfare of saving the environment because of reduced use of plastic bags? The CEO of one of the major food retailers in Canada is the TV pitch man for this firms environmental push. The stuff that they are focusing on are the easy, big media splash elements. And they are doing this while continually buying more and more of their goods from China, where environmental standards to say the least are lax and furthermore, there is a significant amount of pollution generated by the transportation of these products ( I won't get into the health aspects but I'm sure most have read about the cautionary tales about products from China). Furthermore, shouldn't they be looking at their shelves and the massive amount of unnecessary packaging that they allow their suppliers to put their products in? To "trick" consumers into thinking they are getting more bang for their buck, they put small quantities into huge boxes -- the packaging could easily be taken down in many cases by half -- that would have a significant impact on the environment. Yet this type of approach -- although long term i.e. sustainable -- would not create the type of media splash -- because it would mostly be done behind the scenes, away from the spotlight.

So when corporations and governments get on their high horse and talk about caring about the environment -- look beyond the media hype and see if they really care or are they just enjoying the photo-op.

Is it time for more entrepreneurial thinking in Procurement?

When most think about procurement (of course that assumes that some do think about it), they often perceive a group that is so focused on the savings line and therefore misses the bigger picture. Of course, for procurement, one of the key measures of success often lies in the "savings metric", but as always, be careful about what you measure because it won't necessarily drive the correct behavior.

So why not focus on more of an entrepreneurial procurement organization -- focused on top-line and the bottom-line,with more of an emphasis of providing frameworks and act as a consultant for corporations in all matters relating to procurement, and at the same time ensuring that effective partnerships are pursued with vendors (note I mean real partnerships --walking the talk, not just talking and tripping when push comes to shove), and that the innovation within that community is utilized for enhancing the overall business model for the corporation.

Depending on where you are at in procurement's evolution within your organization this may need to be done incrementally vs. in one fell swoop. The stepping stones which I see to get to entrepreneurial procurement are:

• If mostly tactical and administrative and decentralized -- focus first on centralizing and moving the team up the ladder by developing effective processes/procedures in concert with your constituency...internal and external
• Focus on understanding the business as a whole...not from your little world. Although you cannot cut lose the savings umbilical cord quite yet (as this is what binds you to the organization)...start working with your internal business partners...try to understand the business from their perspective....then develop your strategies to align with those of the business.
  
• Reach out to your suppliers...go visit them...meet with their key people, including their procurement and supply chain folk....you might find that there are some common issues/challenges which you can work on commonly. Utilize your suppliers knowledge of the marketplace as a whole...find out what innovations they see coming up in the future...how can that potentially advance your corporations competitiveness?
• When you have gained traction within the organization and a centralized model is working effectively, it is now time to decentralize (OK stop the screaming)....There is an old adage that before you can let go, you need to take control...so the first steps here are taking control...and now...when it is in the corporation's DNA to understand the procurement protocol...it is time for procurement to become more of a high level consultant to the organization...working with the internal teams to ensure that they have effective go-to-market strategies for procuring goods and services and that all options have been considered; maintaining the relationships and tapping the innovative supplier corridor; providing high level negotiation and dispute resolution skills; acting as an ombudsman(woman) for issues/challenges;....there is more but you get the idea. The senior leader of this group would be part of the executive leadership team and actively participates in corporate strategy development and discussions.

Being the police and the savings entity is not helping move procurement to the boardroom table...

Where have all the nice people gone?

I was reading the other day about Gordon Ramsay's restaurants taking a 90% profit dip....of course those of you who may not know he is the centerpiece of Hell's Kitchen TV show, where he basically behaves like a 2 year old child with a tantrum. His screaming and ranting are his signature, but what I find amazing that today we somehow have decided to idolize these mean and nasty people.

In fact, besides the usual suspects in the media -- such as Simon Cowell, Kevin O'Leary (Dragon's Den), Piers Morgan -- we have allowed this to morph over into organizational leadership too. The Globe and Mail made Hunter Harrison (CN) last year's CEO of the Year...with the moniker "hardass of the year"....sermonizing about his take no prisoner's approach. And let's face it prior to him Paul Tellier, had a similar reputation.

There are many examples of this -- when teaching a leadership course I ask participants to provide insight into the "good, bad and ugly" of leaders they have encountered. For most, it is easier to give multiple examples of the bad -- screamers, control freaks, liars etc -- then of the good. Yet one thing is constant...when they are working for good leaders -- those who are just, fair, encourage and mentor -- their productivity goes up, as does their creativity.

Perhaps it is time that we stop making folk heroes out of those who do not know how to lead and be able to provide constructive criticism to ensure that people grow and flourish. This is not Pollyanna ramblings -- I have held many leadership roles over the years and thankfully most people would chose to work with me again -- not because I created a country club atmosphere, but because I helped them develop beyond their expectations -- by being direct, honest and above all a mentor. These people delivered amazing results and although it was their work, and they were credited with it -- they made me look good -- and for that I am thankful.

Let's make heroes out of those who have emotional and social intelligence -- a return to civility -- not hailing the bullies in the backyard.

So to Gordon Ramsay lamenting the loss in profit in his restaurants -- no sympathy hear

If it would look bad in a headline...don't do it!

"I think there's less than meets the eye and less than meets the headline with respect to the story."

...Colin Powell

For years, whenever someone asked me about a potential ethical dilemma, I always gave the same advice:

1. Because you are asking me about it, means that your gut is telling you that it is inappropriate so .... follow your "gut"
2. If you wouldn't want to see it in a headline...don't do it!!

Interestingly, the retort I usually got back from the latter usually was "Well, that's unfair, because headlines are taken out of context." Well duh...no kidding...that's the point...there is generally no context to news stories.

Which brings me to the "scandal" around E-Health Ontario. I know there are two sides to this story -- Sarah Kramer was brought in to kick start an organization that had woefully gone off track and spent hundreds of millions of dollars with nothing to show for it. She most assuredly was given short timelines to begin showing results, so perhaps shortcuts were taken. To follow pure public procurement rules/procedures results in onerous delays, which is why we often see the government's not achieving as much (or much of anything) as they should -- although they can always say ..it was a fair/open and transparent process-- but at the end of the day..the process may not demonstrate value for money.

So understand, I'm not defending Ms. Kramer (and btw I don't know her), but what I am saying is there is a lot more to this story than is written in the media.

So that brings me back to the headline issue. You see if Ms. Kramer had stopped for 1 minute and asked herself that question, she would have ensured that there was a significant amount of documentation for sole-sourcing -- explanations that were bullet-proof (perhaps there are, but you figure, if there were they would have been made public by now). So the headlines of "untendered, multi-million dollar contracts" could have been quickly addressed with this type of document/business case/justification.

But that wouldn't have gotten rid of the issue of expense claims by the consultants, the coffee and muffin and the now infamous Chocobites. Interestingly, a number of years ago, one of my staff was travelling and tried to expense a $1.50 coffee at the airport. I didn't allow the expense, and the rationale was this...if you were in the office at that time, would you have gone down to Timmies and bought a coffee, or was there a coffee machine in your cubical I wasn't aware of? Needless to say, there were never any such claims made again.

I have travelled on behalf of clients and when I do my expenses, number 1, line up with their specific corporate policy. Secondarily, I don't expense coffee or anything below $10 actually, and if I have a glass of wine at dinner, I don't expense that either -- it is my choice -- a want not a need! And in fact, if I am working for a client in the Toronto Area, I only charge for parking...no mileage, no meals -- and my rates are significantly below those charged by the E-Health consultants -- and I consider myself to be very good at what I do...

So shame on the consultants for expensing these claims, and shame on whoever was reviewing the invoices for allowing them (not to mention the one where the consultant supposedly billed for consulting to herself -- error or not, it should have been picked up by somebody). Perhaps these expense claims never made it to Sarah Kramer, but inevitably the buck would stop at her door.

The travesty began when someone agreed to a contract that allowed for these claims to be made...disbursements in professional services can cost more that the per diem rates...but many corporations fail to put a lid on disbursements when negotiating this contract.

So remember -- no headlines please...if individuals dealt with corporations money as if it was their own..there would be peace and harmony for all :)

In Business, as in American Idol -- too often we make the safe vs. innovative choices

I love innovation and creativity. That's why I was hoping that Adam Lambert would win American Idol last night. But, as my son calls them, the "sheeple" won the day.
I'm not taking away from the fact that Kris Allen has talent. He has loads of talent. Unfortunately, he is like a lot of other performers out there and inherently a safe harbour -- people felt comfortable with Kris, whereas Adam, with his looks and his innovative approach to every performance made many a little uncomfortable.

Well, we often make this type of decision in business as well. Go with the "tried and true", vs. the innovative and creative. Yes, the choosing of the latter is riskier...you might be pushed to have to think in a whole new way, but the payoffs for reinventing your business could be amazing.

Just think if GM had chosen to follow the Lambert Way, instead of the Allen comfort zone? We might actually had seen some innovation and perhaps the firm would not be teetering on the edge of bankruptcy today. Same goes for Chrysler...and let's not forget Microsoft, which to a certain extent has rested on its laurels...as opposed to Apple, which has continuously pushed the envelope. The mantra of "it worked before, so let's not change it", is inevitably the death knell for many companies...who once were leading the pack, but now find themselves at the back of the pack...seeing the competition ahead by many lengths in the business Kentucky Derby!

So good luck to Adam Lambert. This young man is going to be a superstar, regardless of mainstream America's rejection of him. In a few years, Kris Allen will be all but forgotten, and Lambert will be playing to packed stadiums around the world.

Best-In-Class versus Best-for-You

Everyone is constantly talking about best-in-class, and very often, for the wrong reasons, labelling themselves as such or indicating that that is what they strive for. According to the business dictionary, best-in-class is defined as:

"Highest current performance level in an industry, used as a standard or benchmark to be equaled or exceeded. Also called best of breed."

So what is this thing that many companies strive for, and is it truly what they should be doing. Sometimes by focusing on best-in-class, are we missing what is best-for-you?

No two businesses are exactly the same -- that is a truism. Comparatives are always interesting and knowing what others are doing is of value -- what is working, what is not. But there is a danger when looking at best-in-class -- who decides what it is, and furthermore, when looking at instituting what someone had deemed as best-in-class -- are you perhaps trying to put a square peg in a round hole.

Often times, corporations are disappointed with the results from some of the mega consulting firms coming in and leveraging on what they have done before -- cookie cutter their solution to a client. Too often, what I have experienced is that when I get to the client, they have spent a couple of years trying to implement something, which truly didn't make sense for them, but because this "respected" consulting firm told them this is what the "best-in-classers" do, they felt obligated to try.

Don't get me wrong. I am a big fan of seeing what has worked (or hasn't) for other firms. Yet once you've done that -- then look at the business your running, and see if it makes sense for you. Having been as an executive in many different industries, and consulting in many more, I can comfortably say that the Pareto rule is alive and well. That is to say that 80% of the aspects of the business are similar -- processes, business drivers, etc., however 20% are unique. What I have also learned it that if you ignore that 20%, anything you try to institute is doomed to failure -- the square peg, round hole scenario.

So let's give "best-for-you" more credence. Create your own horizon -- take heed of the lessons learned from others, but don't follow blindly -- just because some amorphous mass tells you this is what should be done. Create your own footprint...and who knows -- tomorrow someone might be calling you best-in-class!

Who me? Allegations of Bid Rigging and a call for Simplifying the process

Back in February there were allegations made by the Competition Bureau that some technology services firms had engaged in "bid rigging."

"The Bureau says in a release that it has found evidence indicating that several IT services companies in the National Capital Region secretly co-ordinated their bids in an illegal scheme to defraud the government by winning and dividing contracts, while blocking out honest competitors."

It should be noted that these allegations are still to be proven in court, which of course could take years. True or not, the reputation of these firms has been damaged for the long term.

Yet the bigger question here is how could this happen? Let's face it, anyone who has ever dared to respond to a government RFP is inundated with pages upon pages of documentation, which even for relatively simple items can range well over 100 pages! So how is it that someone could engage in bid rigging, in a "bid rigorous" system.

The more you try to address every potential eventuality in an RFP document, the greater the chance for finding ways around it. Because let's face it, when things are kept simple then the opportunity to unveil ne'er-do-well activity is a little easier. I'm not saying go back to the handshake scenario, but we have gotten mired down in so much paper and evaluation that at the end of the day it has become somewhat self-defeating.

I know that it may sound contraindicated -- the greater the complexity to ensure compliance the easier it is to defeat the system, but think about it. When you have limited resources and limited time to come to a decision aren't the pressures going to result in just a cursory review, as opposed to a more indepth analysis.

I understand the need for diligence when the public's money is being spent...however, are our tax dollars being spend effectively when we are propping many jobs in the public sector, just because we have gotten so "scared" about the possibility of a misstep?

Missteps are occuring every day within organizations that allow themselves to be buried in outdated protocol vs. reality. And, as the story from Ottawa demonstrates, you are not eliminating the opportunity for unethical behaviour. Furthermore, to this point, we have seen, regulators like the SEC doesn't keep the world from becoming victims of folk like Bernie Madoff. In fact, it makes us more vulnerable, because we have the misguided sense that we are being protected.

Goes back to the old KISS adage, "Keep it Simple Stupid!" Hopefully sometime soon we will see a rennaissance in government structures to ensure this happens and our public monies are being spent effectively, better decisions are being made faster, and unethical behaviour is uncovered quickly....

Now that's something to hope for-- but I won't be holding my breath!