Supply Chain Management

The Evolving Supply Chain Manager

By John J. Tracy

Managing today's complex supply chain requires the skills of a C-level executive, plus the special knowledge of supply chain disciplines including forecasting, purchasing, transportation, inventory management, quality, warehousing, channel costing, and technology.

Fifty years ago, nobody managed a supply chain. Departments and individuals teamed up to obtain supply certainty and efficiency. But conflicting departmental and individual goals, poor communication, obsolete accounting practices, and other issues frequently impeded success.

Companies began to recognize these problems and gravitate toward organization realignment, forming materials management departments in which purchasing and marketing often played a peripheral role. The principal stakeholders often dictated the specific capabilities, services, and performance standards that suppliers must meet. The purchasing representative then assumed responsibility for finding suitable sources.

In the 1980s, a range of factors virtually eliminated strong internal supply management capabilities. Cost pressures, new technologies, a focus on core competencies, the trend toward downsizing and outsourcing, the desire to consolidate sources, and the marginalization of supply disciplines were among the elements that gave rise to a whole new segment: the third-party logistics provider. The purchasing officer often contracted these services, while a logistics coordinator oversaw them, relying heavily on the IT and finance managers who drove the new systems.

COMPLICATIONS ARISE

Concurrently, many savvy supply chain practitioners recognized that the impact of newly adopted practices such as just-in-time, lean manufacturing, Six Sigma expectations, and ISO standards, as well as the availability of new technologies, required that enhanced supply chain management skills and practices be developed and retained in-house.

As organizations were pursuing these diverse approaches, two new demands on supplier sourcing were converging: the need to identify and relate to possible global suppliers, and the need to ensure that identified suppliers could adapt to new technologies and to doing business in global markets.

Some organizations that had been stripped of the core skills necessary to manage a supply chain turned to their purchasing officers, or to their IT or finance managers -- the only remaining institutional bases of operating knowledge -- to supervise the supply chain.

THE NEW RULING CLASS

Organizations that recognized these evolving, subtle changes began rebuilding the expertise necessary to truly manage the increasingly diverse and remote base of suppliers and partners. They shored up the hard skills such as inventory and transportation management, quality control, and warehousing, and taught the soft management skills of team building, cultural understanding, and currency economics.

Today, new CEO/COO-qualified supply management executives, charged with entrepreneurial responsibilities and energized with a cadre of imaginative and creative functional managers and specialists, lead organizations poised to harness a continuous stream of opportunities. These are the men and women who will usher supply chain management into its next renaissance.

Entrepreneurship

Tapping into your "inner" entrepreneur

"Could I do it on my own out there?" is a question that many of us have asked ourselves in the course of our careers.

The answer to that question may be tied to whether or not we have a specific set of aptitudes and motivators that make us potential entrepreneurs, says Yvon Gasse, Professor and Director of the SME and Entrepreneurship Centre at Laval University. Gasse collaborated with BDC to develop the Entrepreneurial Self-Assessment Tool which helps people better measure their entrepreneurial potential.

"Although many factors come into play such as your personal circumstances and timing, research does show that business owners often share certain qualities that make up the entrepreneurial mindset," he emphasizes.

Key motivators
For example, Gasse points to 3 "motivating factors", among others, that attract people to the idea of becoming entrepreneurs in the first place.

1. Need for achievement
"The notion of challenge is an important one for entrepreneurs. They often have a strong need to set objectives and achieve specific goals. They will naturally take measures to meet these goals and will want rapid feedback on their achievements," he believes.

2. Need to influence
"Often entrepreneurial types want to influence people and the course of events. Making money may be one motivator but ultimately entrepreneurs want to make an impact on people through their businesses. They may also want to shape the course of events by, for example, buying another company or moving their business to China."

3. Autonomy
"Another motivator at the root of entrepreneurship is the desire to be independent," says Gasse. "You want to be your own boss and feel in control of your destiny. Independence is a strong driver for people who want to set up their own businesses and pursue their dreams."

Some key aptitudes that shape entrepreneurs
Along with these motivating factors, Gasse contends that entrepreneurs also have specific aptitudes that make them more likely candidates to set up their own businesses.
Among these are:

i. Perseverance
"Business owners are usually determined to get past obstacles and see a project through its completion despite setbacks. They will overcome their frustrations and problems and persevere," says Gasse. "Given the challenges of today's complex business environment, this aptitude is at the top of the list."

ii. Self-assurance
"Entrepreneurs show self-confidence and trust their instincts. This self-assurance helps them through difficult times and pushes them to achieve tough goals," he says. Without that self-assurance, people hesitate and aren't so willing to take calculated risks, he adds.

iii. Creativity
Another aptitude that Gasse emphasizes is creativity. "This is particularly true when it comes to the ability of an entrepreneur to creatively identify business opportunities. Entrepreneurs instinctively see gaps in the market and can find unique products and services that meet a demand," he emphasizes.

iv. Tolerance for ambiguity
"Entrepreneurs are comfortable with ambiguity, and capable of making decisions even when they don't have all the information they need. For example, you might be selling products or services in a relatively unknown market. This level of uncertainty can be very stressful for most people but entrepreneurs learn how to work around it," he believes.

v. Attitude toward failure
"Many business owners have a long history of failures and accept these as part of the learning experience," says Gasse. "Rather than view failure as a catastrophe, an entrepreneur will learn from his or her mistakes and what to avoid the next time around. They'll pick themselves up after a failure and start over."

vi. Action-oriented
"Entrepreneurs don't rest on their laurels and are driven to accomplish their objectives through concrete action," adds Gasse. "They want to get down to work and won't put off difficult tasks until later. That strong desire to tackle their objectives and see quick results often characterizes people who want to run their own companies."

Before you get going
If you see that you have the necessary motivators and aptitudes to become an entrepreneur, Gasse recommends that you first get a clear business plan in place. "It's important to not think of your business plan as simply a way to attract financing. It's much broader than that. Ideally, a business plan is a real roadmap that shows where you are going with your company. It should demonstrate that you've done your homework, understand your market and that you can actually generate business. Once you have that plan in place, you can move more confidently ahead."

* * * * *

Thinking of starting a business? BDC Consulting has a national network of management consultants that can help your business move forward confidently. From in-depth business planning to management coaching, BDC's experienced business advisor may be one of your best investments. Contact us today.

For more information see: Start a business

'We can't pay and we won't pay'

Pirate Bay co-founder to Swedish court: 'We can't pay and we won't pay'

The men linked to the Pirate Bay file-sharing site were defiant on Friday after a Swedish court found them guilty of breaking the country's copyright law.

17/04/2009 5:45:46 AM

CBC News

The Stockholm district court sentenced Gottfrid Svartholm Warg, Peter Sunde, Fredrik Neij and Carl Lundstrom to one year each in prison for "assisting making available copyrighted content."

They were also ordered to pay damages of 30 million kronor ($4.3 million Cdn) to a number of entertainment companies, including Warner Bros., Sony Music Entertainment, EMI and Columbia Pictures.

But the group said any verdict would be appealed, and the website home page carried a message equally defiant:

"As in all good movies, the heroes lose in the beginning but have an epic victory in the end anyhow," said a message posted to the site. "That's the only thing Hollywood ever taught us."

Peter Sunde, one of the four founders of the site, said in a video posted Friday the court's ruling was "bizarre."

"It's so bizarre we just have to laugh about it, it's unreal," he said.

As for the damages awarded, Sunde said the number was meaningless.

"They could have gotten one billion," he said. "We can't pay and we won't pay."

Hollywood welcomes decision

The Pirate Bay website connects BitTorrent networks to allow users to swap music, video or game files, but the site's founders had argued they were not responsible for the files they directed users toward, since they themselves did not host any of the files.

However, the court found the defendants guilty of aiding in the committing of copyright offences "by providing a website with - sophisticated search functions, simple download and storage capabilities, and through the tracker linked to the website."

The Motion Picture Association of America chairman and CEO Dan Glickman said his organization welcomed the decision.

"This is an important decision for rights-holders, underlining their right to have their creative works protected against illegal exploitation and to be fairly rewarded for their endeavours," Glickman said in a statement.

Michael Masnick, who runs the influential technology blog Techdirt and is a frequent critic of the recording industry's methods of dealing with alternative forms of content distribution, said in a blog post Friday the decision raises questions about the culpability of providers of online search tools.

"The idea that a toolmaker can be liable for the actions of its users should trouble everyone - especially when the tools have plenty of legitimate uses as well," he wrote.

As copyright law is carried out domestically, the decision isn't likely to have an effect on other countries, nor is it likely to discourage file-sharing, said University of Ottawa professor Michael Geist in a blog post Friday.

But he said the decision could be used to encourage internet service providers and search engines "to play more active roles in policing their networks."

With files from The Associated Press

RBC Reports First-Quarter Profit

Canada's RBC takes $850-million hit

NEW YORK (Reuters) - Royal Bank of Canada , Canada's largest bank, said it will take a charge of roughly $850 million (C$1.03 billion) because the value of its international businesses has declined, reducing second-quarter earnings by an equivalent amount.

The Toronto-based bank said the charge covers a write-down of goodwill, which "reflects the impact of prolonged challenging economic conditions." It said the charge in particular reflects declines in the U.S. economy, the U.S. housing market and the market value of U.S. banks.

Analysts on average had expected second-quarter profit of 85 Canadian cents per share, according to Reuters Estimates.

A bank spokeswoman stressed that the charge was an accounting adjustment only.

"It does not affect our cash earnings, our capital ratios, our business operations, or our ability to pay dividends," Jackie Braden said in an email message.

The charge is roughly equal to RBC's reported first-quarter profit of C$1.05 billion, or 73 Canadian cents per share.

Since the global credit crisis began, and especially since last summer, a variety of lenders have taken large goodwill write-downs because reduced economic and business activity have lowered the value of some of their units.

Goodwill typically arises in acquisitions and represents the value of such intangibles as reputation and brand-name recognition.

RBC said its fiscal second-quarter ends on April 30, and that it plans to release results for the February-to-April period on May 29. It said the $850 million charge is a non-cash item that will not affect its operations.

Shares of RBC closed Thursday up C$1.22 at C$42.35 in Toronto. The bank announced the charge after markets closed.

($1 = C$1.21)

(Reporting by Jonathan Stempel; Editing by Steve Orlofsky)

Small Business Internship Program

What is Industry Canada's Small Business Internship Program?

The Small Business Internship Program provides small and medium-sized businesses financial support to hire a post secondary student intern to assist them in their adoption of information and communications technologies to increase their productivity and competitiveness.

Industry Canada's Small Business Internship Program is a collaborative effort with Canadian small businesses, post-secondary institutions, and non-government organizations that offer promising post-secondary students hands-on experience working on e-commerce projects under the mentorship and coaching of entrepreneurs. Student interns will gain an appreciation of entrepreneurship, and an opportunity to explore career possibilities.

How does the Small Business Internship Program work?

Small and medium-sized businesses (SMEs) submit an application to the organization delivering the program in their area. If their application is approved, they can hire a student intern to help them take advantage of information and communications technologies (ICT) to help grow their business. SMEs will have the flexibility to hire the interns that possess the skills and abilities for their specific project or needs. We encourage them to hire from employment equity groups.

The SME negotiates the salary of the intern, and the benefits they may receive. Once the 12-week internship is over, the Government of Canada will reimburse 75 percent of their eligible costs, up to a total of $10,000. The SME gets the information and communications technologies help they need to grow their business, and the student gets valuable on-the-job experience.

What are the eligible costs?

Eligible costs that can be claimed by participating SMEs are the student interns’ wages and related expenses such as statutory employee benefits.

How does the Small Business Internship Program address the ICT needs of SMEs?

A significant number of SMEs are currently simply connected to the Internet or are passively on-line, and might not be taking advantage of the possibilities offered by e-business. The Small Business Internship Program seeks to improve the competitiveness of SMEs by supporting businesses to actively market on-line and improve their competitiveness with e-business practices and technologies.

Sun Microsystems Rejects IBM Offer

Sun shares plummet after IBM talks collapse

REUTERS

April 06, 2009

NEW YORK (Reuters) - Shares of Sun Microsystems Inc tumbled 23 percent on Monday after the company rejected rival computer and software maker International Business Machines Corp's $7 billion offer.

Sun shares fell to $6.52 in early morning trading after Sun pulled the plug on the deal which might have spelled the end of an era for a networking company that was once synonymous with the Internet.

The buyout was seen as a means for survival for the once-storied Silicon Valley company, which has been losing market share.

Sun was unhappy with IBM's offer of $9.40 per share or below, and it was unclear if talks would resume, according to a source, who was not authorized to speak publicly about the matter. The bid represented a premium of up to 89 percent on Sun's shares before deal talks were first reported last month.

Sun shares had risen to $8.49 on Friday, from $4.97 on March 17, a day before talks between the two technology companies were first reported. The Wall Street Journal had previously said IBM's original bid was $10 to $11 a share.

The deal may have helped IBM bolster its offering of computer servers, storage equipment and software as competition heats up with rivals like Hewlett-Packard Co.

Sun rose to prominence selling high-end computer servers in the 1990s but never fully recovered from the dot-com bubble burst earlier this decade. Analysts also say it failed to fully capitalize on its software assets including Solaris and Java.

Failed talks with IBM could mean that Sun will need to find another buyer, and contend with a lower offer. But no bidder other than IBM has emerged in the months that Sun has been shopping itself.

(Reporting by Franklin Paul)