Archive for the ‘Business Sourcing’ Category

Nuclear Incentive

Thursday, March 23rd, 2017

 

Today’s post is by Mike Figueroa, Assistant Director of Customer Services at SafeSourcing

This is a continuation of the blog “Nuclear Negotiation”. I’m setting out to answer the most important questions about nukes by listing facts I deem important by two measures: How severe the effect on human beings could be, and 2. The number of lives it could affect. Then I will conclude with discussing the human factors at play, and how they affect our daily lives.

  •  Global Nuclear war would not end all life on earth: The US and Russia each have detonated thousands of nuclear weapons tests, and these did great harm to the environment, but it did not trigger an extinction level event (though most were in the ocean, to prevent debris fallout that an actual war would not). A war detonating anything above 100-megatons of total yield seems to be the estimate for what it would take to end “modern” humanity, in terms of causing global collapse of infrastructure (Turco et al. 1983) due to its environmental and radiological effects. Most experts seem to agree that some remnant of human life would continue to exist, even if it took thousands of years to recover, though of course there is no guarantee it ever would return to our current level of modernity.
  • The system will only work/stay out of nuclear war for as long as all players behave predictably. Mutually Assured Destruction (or MAD as it’s referred to) is the concept that for as long as it is assured that an attacking company would be destroyed for destroying its intended country, it won’t make the attack in the first place out of its own interest of self-preservation. The problem though of course, is that MAD assumes a. all participants are rational, and b. that no unpredictable cause, such as an accident/malfunction or terrorist nuclear incident, would occur and throw the delicate system out of order.
  • The British philosopher Bertrand Russell called this balance a walk on a tightrope, however: “You may reasonably expect a man to walk a tightrope safely for ten minutes; it would be unreasonable to do so without accident for two hundred years.” There are bills being considered with the aim of limiting the US President’s ability to launch a nuclear strike (Lockie 2017) in an attempt to create a safety net below this “tightrope”. However, this in and of itself could cause nuclear war, by removing the “Assured” part of Mutually Assured Destruction for any would-be attacking nation.
  • Reducing Risk  If you’ve wondered why there has been so much pressure over the years to reduce all nations’ nuclear arsenals, this is it. The assumption is that there needs to be a balance where our weapons of mass destruction are present enough to de-incentivize war, but that there are few enough of these weapons around that we don’t destroy our species over a misunderstanding inept leader. Afterall, the leaders we are trusting not to push that nuclear button are subject to all of the same weaknesses you and I are, and to expect that to go on indefinitely without disaster is to not understand human nature.

Why has MAD worked for the past 70-some years? Because of game theory: Player A makes a move, that forces player B to make a move to get to an optimum point, and both players keep making moves until there is no new move that will improve either player’s condition (equilibrium). In procurement, this means a buyer will switch suppliers that provide better products, pricing, logistics, etc. And conversely, a supplier will adjust pricing in order to retain (or gain new) business, up until the point where any more moves will not gain more benefit/would incur a negative outcome. Sound familiar? It’s the force that drives basically all human activity: Businesses change suppliers, people change relationships, nations create weapons of mass destruction, and the changes continue until all actors have reached a point where change would be less good than the current arrangement, and so equilibrium is reached.

But have you ever seen someone make a decision/change that took them out of equilibrium, to the point that they incurred a loss? Someone destroys a positive personal relationship? Sells product at a loss? Makes an irrational decision? It’s an irrational but very human thing to do. We do have the ability to learn and the capacity to be rational, and avoid making this mistakes in our professional lives. But maybe the most important thing we can do, is ensure our leaders the world over are unflappably rational, by knowing how to be rational ourselves. It’s literally the only thing allowing us to deal with our opponents effectively, in politics and in business.

For more information on how SafeSourcing can assist your team with this process or on our “Risk Free” trial program, please contact a SafeSourcing Customer Service Representative. We have an entire customer services team waiting to assist you today.

———————————————————————

Mills, Michael J., Owen B. Toon, Julia Lee‐Taylor, and Alan Robock. 2014. “Multidecadal Global Cooling and Unprecedented Ozone Loss Following a Regional Nuclear Conflict.” Earth’s Future 2 (4). Wiley Periodicals, Inc.: 161–76.

“[No Title].” 2017a. Accessed March 12. http://www.belfercenter.org/sites/default/files/legacy/files/IS3904_pp007-048.pdf.

———. 2017b. Accessed March 12. https://ia802303.us.archive.org/26/items/ManhattanDistrictHistory/MDH-B8V02P01-LosAlamos-Technical.pdf.

“Nuclear Arsenals | ICAN.” 2017. Accessed March 12. http://www.icanw.org/the-facts/nuclear-arsenals/.

Turco, R. P., O. B. Toon, T. P. Ackerman, J. B. Pollack, and Carl Sagan. 1983. “Nuclear Winter: Global Consequences of Multple Nuclear Explosions.” Science 222 (4630). American Association for the Advancement of Science: 1283–92.

 

The Importance of Good Leadership in the Workplace

Friday, March 17th, 2017

 

Today’s post is by Jericia Stevens, Account Manager at SafeSourcing Inc.

Good leadership is a direct correlation to the success of a company, because of this good leadership cannot be overlooked or over emphasized. Leadership is the substance that makes all other elements come together. Great leaders know the importance of being in tune with the needs and issues concerning the business as well as his/or employees.

As a leader of an organization or business, it is also important to stay abreast of new developments in leadership theories and methods in order to maximize effectiveness.

Rebecca Hourston stated it best, “The substance of what you do—the result you deliver—is pretty fundamental in today’s economy. But working on the way that you do it is what will launch you into a different sphere of success altogether—even if you already count yourself as pretty successful.”

An effective leader trains others to become leaders. A good indicator of your ability to lead is how well the company operates in the mist of his/her absence. A company should not falter in the absence of its leader; it should operate business as usual.

An important thing to remember is leaders and leadership styles may need to change at times to accommodate the changes within the business or organization. For example, when new people are hired and join your team; when a leader is promoted or moved to another department.

Leadership also effects productivity.  A good leader knows the strength of their team and knows how to delegate task efficiently, resulting in increase in work productivity.

Also, good leadership can improve employee morale and make workers more loyal to the company.

We enjoy bringing this blog to you every week and hope you find value in it. For more information on how we can help you with your procurement needs or on our “Risk Free” trial program, please contact a SafeSourcing Customer Service Representative.

Resources——————————————————-

Hourston, R. (Ed.). (2014, June 09). 7 Steps To A Truly Effective Leadership Style. Retrieved March 15, 2017, from https://www.forbes.com/sites/womensmedia/2013/04/24/7-steps-to-a-truly-effective-leadership-style/#62e15e411ce5

 

How to Determine the Best Bid

Monday, March 6th, 2017

Today’s post is by Gayl Southard, Administrative Consultant for SafeSourcing.

After six years, our house needed to be repainted. This can be an overwhelming process.  Picking the right painting crew, the type of paint to be used, the prep process, and warranty are all important aspects to be considered.

There is really no difference in sourcing and evaluating vendors to paint your home than there is for a business. However the percentage of your income that is spent on this task may be much higher than it is for a public or private company. All the more reason to ask the correct questions the 1st time around so that everything is covered in your vendor’s proposal.

The following information should be helpful and get you off to a good start.

  1.  Why do some five-year old paint jobs peel and flake while others look like they were applied last week. The simple answer is quality paint and a properly prepped surface. Consumers have a wide range of paint to choose from -nationally known paint to locally produced paint.
  2. Oil paint versus water-based paint?       Water-based paint wins hands down for exterior paint jobs. The US Department of Agriculture Forest Product Laboratory (FPL) in Madison, Wisconsin, showed water-based paints expand and contract with siding.       They also allow water vapor generated inside the house to pass through the paint film. Oil-based paint dries to an inflexible coating that blocks moisture. Also, water-based paint is gentler to the environment because they are lower in volatile organic compounds.
  3. Because the cost to paint the exterior of your home is primarily labor, it makes sense to go with premium paint that offer a longer warranty.
  4. The proper prep process is important. Only prime if the paint has cracked or flaked. If you need to scrape to bare wood, then prime that area.
  5. Clean up. Your property needs to be cleaned up after it is painted. All tarps, taping material, and compounds used to fill in cracks needs to be removed from your property.
  6. Make sure you walk your property with your contractor to make sure you are both satisfied with the job. I used a painting company from a national referral company. The contractor is motivated to do a good job, as a survey is completed after the job is done. A bad review can seriously damage a contractor’s reputation.

When sourcing goods and/or services, SafeSourcing can provide you with all the information necessary to make a decision on a vendor. For more information on how we can help you with your procurement needs or on our “Risk Free” trial program, please contact a SafeSourcing Customer Service Representative We have a entire customer services team waiting to assist you.

Part II of II. Are reverse auctions a good tool to use in the retail distribution cost plus arena?

Friday, March 3rd, 2017

 

Todays post is by Ron Southard, CEO at SafeSourcing

Yesterdays post reviewed why and how this author felt that reverse auctions were potentially good for both the distributor and the retailer alike. So just what is cost plus?

According to Wikipedia  Cost-plus pricing is a pricing method used by companies. It is used primarily because it is easy to calculate and requires little information. There are several varieties, but the common thread in all of them is that one first calculates the cost of the product, and then includes an additional amount to represent profit. It is a way for companies to calculate how much profit they will make. Cost-plus pricing is often used on government contracts, and has been criticized as promoting wasteful expenditures.

Once unit level cost has been established for the distribution of products it’s easy to turn that into a percentage and add it to the price of a product coming up with a distributed unit price or category price. The most important part of this pricing exercise for the distributor is to get the distribution costs correct. This can include price of storage, freight, length of travel, driver cost and any number of other costs. This is an area where a distributor can lose a lot of money if they are not very careful.

So, are revere auctions a tool that can help distribution companies?  The answer is a clear yes both above and below the gross margin line. If you like to know more please contact me at ronsouthard@safesourcing.com.

We look forward to and appreciate your comments.

Gross Domestic Product

Tuesday, February 28th, 2017

 

Today’s post is by Jericia Stevens, Account Manager at SafeSourcing Inc.

Gross Domestic Product (GDP) is the value of all goods and services produced in the U.S. The GDP figure is released quarterly. We use GDP to measure economic output. The growth rate in GDP is closely evaluated by the Federal Reserve to determine whether the economy is growing too slowly or too quickly. (Bankrate.com)

I recently read an article concerning the GDP and if it can still effectively measure the economy. This was being questioned because the economy has shifted from being a production driven economy to a more service driven economy. The economy used to be driven by the production of things, such as refrigerators, cars, shoes, etc.

Today the economy thrives from services and technologies. According to the Bureau of Economic Analysis, the quarterly data by industry reports that finance and insurance; wholesale trade; and information services were the leading contributors to the increase U.S. economic growth in the third quarter of 2016. The Bureau also reported, 20 of 22 industry groups contributed to the overall 3.5 percent increase in real GDP in the third quarter.

SafeSourcing, Inc. is part of the service industry. We provide innovative eProcurement tools that can increase efficiency and improve profitability for our customers; as well as provide superior value for all stakeholders. In addition to providing information, tools and services, SafeSourcing proactively supports consumer safety and environmental standards throughout the global supply chain management process.

To learn more, visit SafeSourcing.com.  Let SafeSourcing manage your services, goods and projects. We can handle your sourcing needs. We enjoy bringing this blog to you every week and hope you find value in it. For more information on how we can help you with your procurement needs or on our “Risk Free” trial program, please contact a SafeSourcing Customer Service Representative.

————————————————————

https://bea.gov/newsreleases/glance.htm Ahearn, Cale (2016, September 21).

 

 

What is an Onboard Diagnostic II (OBD-II) Scanner?

Friday, February 24th, 2017

 

Today’s post is by Troy Lowe; Vice President of Development at SafeSourcing.

An Onboard Diagnostic II (OBD-II) scanner is a device that is used to read information from the computer within vehicles that were built after 1996. There are two types of OBD-II devices.  The first are basic code readers which can read and clear codes.  The second are scan tools which can provide more information about specific codes and provide access to recorded and live data.  The scan tool is the more expensive of the two and offers a variety of features not found in the basic reader. The devices are fairly simple to use and connect to a standard connector usually located under the dash.  Some of the devices are Bluetooth or Wi-Fi enabled and can connect to your smart phone using apps that are available for download.  There a many apps available that offer different features, you just need to make sure it is compatible with your OBD-II device you own.  To use the scanner, simply plug the device into the vehicles connector, connect to the device using your smartphone and then open the OBD-II application.  The most common use for the device is reading current trouble code(s).  These are codes that can be given off by the check engine light, check transmission light, ABS light, airbag light or other modules.  These codes can be accessed and cleared by using the downloaded application.  Depending on the application you may also be given additional information about the trouble codes such as possible causes and possible fixes for the recorded code.  Below are some other diagnostic features that are available with a scan tool and compatible application.

  • Engine Temperature
  • Fuel Rate
  • O2 Sensors
  • MAF Airflow Rate
  • Batter Voltage
  • Vehicle Speed
  • RPM

If you would like some help finding the right scanner, we can gather all the necessary information for you and help you decide which one will meet your needs. If you would like more information on how SafeSourcing can help you, please contact a SafeSourcing Customer Service representative.  We have an entire team ready to assist you today.

 

Ready, Set, Gone

Monday, February 20th, 2017

 

Today’s blog is by Margaret Stewart, Manager of HR and Administration at SafeSourcing.

With a world of information at our fingertips, it can be difficult to no not only gain people’s attention, but also to sustain that interest. It is believed that a person forms an opinion of a product, company, or another person within eight seconds. On top of that, most people visiting websites only average 10-20 seconds before leaving. Viewers visiting websites and online articles will likely only read about 20% of the words on the page. This is a growing challenge for businesses and especially marketing groups, but they have found a few ways to not only get more viewers, but to keep their attention even longer.

First, keep messages short and to the point. While lots of information and expanding on a variety of topics is great for research and academic papers, most consumers retain short simple messages. If the message happens to resonate with a consumer, short and clear facts help to keep their attention.

If the message you want to relay is a long and complex one, there are ways of getting viewers invested in what you are trying to say. For example, telling a story or using real life examples can be highly effective. Presenting a common problem or situation with your message embedded into the story can leave a lasting impression.

Second, make things easy. Majority or viewers prefer watching a video to reading a block of text. Often, just putting text over a video can be just as effective. However, if a video is not an option, using graphics and images is a way to keep attention and even inject humor into topics.

With our ever-moving, fast-paced digital age, getting your message across effectively can not only get the attention you seek, but also change the processes of how business and marketing approach consumers. Different tactics can yield different results, and sometimes stopping to smell the roses is an underrated activity.

For more information on how SafeSourcing can get your message out, or on our Risk Free trial program, please contact a SafeSourcing Customer Service representative. We have an entire team ready to assist you today.

Sources:———————————————————

http://www.socialmediatoday.com/social-business/shortening-human-attention-span-and-what-it-means-marketers-infographic

 

 

The components of information

Thursday, February 2nd, 2017

 

Today’s post is by Mike Figueroa, Manager of Customer Services at SafeSourcing

Communication is a funny thing. We communicate day in and day out, most of the time successfully, but it’s easy to think of examples where our message has not be received as intended, or we just weren’t able to pick up what someone else was trying to communicate to us. Much of the time, we find that the fundamental issue in miscommunication is that the message giver and the message receiver have different understandings of the concepts being traded back and forth. For example, one person’s idea of “love” looks completely different from someone raised in a family that expressed love in a totally different way. Another simple example could be if you’re sent to the grocery store with instructions to get “apples”. In your mind, when you hear the word “apple” you have a picture of a Honey Crisp apple, but the person who sent the request has an image in their mind of green Granny Smith apples. All communication is based on templates stored in our minds, on hard drives, on documents, etc. And if we don’t understand what information IS, we’re bound to make mistakes in how we trade it with others in our professional lives.

Information, generally speaking, is a representation of other objects stored within a physical medium. All information is stored in physical objects, such as hard drives, CD’s, brain cells, etc. The higher fidelity of information is stored, the more accurately it represents the object of its focus. For instance, a picture of a widget in low definition, and vague description in a specifications sheet, won’t represent that widget as well as a high definition picture, with several pages of precise descriptors. Similarly, a cell phone recording of a symphony won’t represent the event as well as an IMAX recording would. But the IMAX data will be potentially thousands of times larger, because it takes larger physical space, to record information at higher fidelity. This is because the more possibilities your information CAN’T represent, the more detailed it has to be and the more likely it can only represent what you intend it to.

In the Information Theory context, entropy can be defined as the delta of change from order, to disorder/randomness. Information entropy is the average information of all possible outcomes. In other words, information is most precise, when it disqualifies EVERY possibility other than the very specific one it is trying to represent. If the information you are sending could mean any one of a dozen things, you are bound to have some unavoidable margin of error in communicating to your audience. The tricky thing though, is there’s a tradeoff.

The greater fidelity the information is, more precise your communication will be. However, this increases the size of the information content, making it more difficult to manage, decode, or asses. The tradeoff is that the more precise the information, the more difficult to use. How this translates into procurement specifically, is that there will always be some margin of ambiguity in any specifications document. However, that doesn’t mean an RFP can’t be flexible enough to meet a buyer’s needs. Here are a few ways procurement professionals can make sure their documentation avoids falling into some of the common communication pitfalls inherent to the transfer of information:

  •  Identify the most important attributes, and focus your specifications on those. For instance, perhaps the business goal of the purchase doesn’t depend at all on color, or pack size, or the availability of support staff. Keep the more detailed information limited to the important attributes.
  • Add flexibility to your bid for consideration of equivalent products. Sometimes being too specific means that a vendor who may have a superior product to offer, isn’t able to propose his alternative if a specification calls for an exact match to a lesser product.
  • Ask yourself “would something I wouldn’t want qualify under the specifications I’m creating?” Remember, information should guide your audience to a specific concept, and disqualify all other possible concepts, as much as is possible without overburdening your audience.

For more information on how SafeSourcing can assist your team with this process or on our “Risk Free” trial program, please contact a SafeSourcing Customer Service Representative. We have an entire customer services team waiting to assist you today.

Sourcing in Times of Disaster!

Wednesday, February 1st, 2017

 

Today’s post is by Jericia Stevens, Account Manager at SafeSourcing, Inc.

Recently, Gatlinburg, TN experienced a historical wildfire that destroyed hundreds of homes and businesses. The residents of the city where forced to evacuate and seek refuge in emergency shelters. Sevier County Mayor Larry Waters said, “This is a fire for the history books,” Gatlinburg Fire Chief Greg Miller said, “The likes of this has never been seen here.”

As I read about this tragedy, I thought, can this beautiful and lucrative tourist town recover from such devastation? Ironically, that same week I read one of the White Pages written by our CEO, Ron Southard, entitled, 4 Tips and 3 Pitfalls to Avoid when Sourcing Professional Services, A Little Planning can Save Companies Millions.” In it Ron listed poplar services targeted for new procurement projects: The professional services that could be useful for homes and businesses in Gatlinburg are: Disaster Response (Emergency Cleanup), Environmental Services, Construction Services, Temporary Labor, and Waste Management Services. Yes, Gatlinburg will be great again and sourcing professional services during this tragic disaster can help.

SafeSourcing, Inc. can assist you in times of disaster. We provide innovative eProcurement tools that can increase efficiency and improve profitability for our customers, and provide superior value for all stakeholders. In addition to providing information, tools and services, SafeSourcing proactively supports consumer safety and environmental standards throughout the global supply chain management process. To learn more, visit SafeSourcing.com

Let SafeSourcing manage your sourcing projects. We enjoy bringing this blog to you every week and hope you find value in it. For more information on how we can help you with your procurement needs or on our “Risk Free” trial program, please contact a SafeSourcing Customer Service Representative.

 

Could YOUR Company be saving more money?

Tuesday, January 31st, 2017

 

Today’s post is by Mike Figueroa,  Manager of Customer Services at SafeSourcing

What prevents a business from reducing costs by engaging in eProcurement best practices? The most common obstacle we see is simply a limitation in mindset, or the lack of will to change practices that maintain the status-quo. eProcurement practices have been around for as long as the internet has, and yet we still find businesses that aren’t aware of the most up to date tools for sourcing, and for whom suggesting a change in practice is akin to blasphemy. What is the barrier to change, and how can you overcome internal objections to improving procurement practices within your organization?

A concept that has come back into the spotlight this election cycle is The Overton Window. This concept is sometimes called “the window of discourse”, and signifies the range of ideas that your audience will accept. Though typically applied to political ideas, it simply relates to what ideas a group of people is willing to consider, and not willing to consider. However, the effort to enact any type of change within an organization will come up against this concept, and will require that The Overton Window be widened. Once the window is widened/the range of concepts willing to be considered has grown in scope, you can begin to garner buy-in of improved processes. So how can we accomplish this in the procurement space? Here are a few recommendations:

  •  Let the results speak for themselves: We run risk-free pilot events for new customers to demonstrate what can be accomplished with eProcurement practices. We routinely saving upwards of 20% on spends in excess of a million dollars using our process. Seeing one category save hundreds of thousands of dollars can quickly get your team to see the possibilities open to them for other categories across the business.
  • Implement cost reduction goals: If you create goals that can’t be accomplished by maintaining the status-quo, your team will have to open their expectations to considering new possibilities. “Necessity is the mother of all invention” as they say.
  • Find examples of being overcharged: We often do analysis of a company’s spend categories and uncover situations where companies are being charged 50% more for products/services than other clients of ours being charged. The only difference is that they’ve never addressed that spend and taken it out to market. If your boss isn’t interested in eProcurement, find a spend he’s losing money on that a category RFP has high historical savings in to demonstrate how much money is being left on the table with current purchasing practices.

For more information on how SafeSourcing can assist your team with this process or on our “Risk Free” trial program, please contact a SafeSourcing Customer Service Representative. We have an entire customer services team waiting to assist you today.