Supply Chain Shaman

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Wrong People on the Bus?

Most people assume that
great bus drivers (read: business leaders) immediately start the journey by
announcing to the people on the bus where they’re going—by setting a new
direction or by articulating a fresh corporate vision.

In fact, leaders of companies that go from good to great start not with
“where” but with “who.” They start by getting the right people on the bus, the
wrong people off the bus, and the right people in the right seats.

Excerpt from the book Good to Great by Jim Collins

My feet still have the blisters from walking the streets of New York.  They are red and cracked.  They were glad to feel the soft lambskin of my slippers waiting for me at home.

Last week, I attended the Consumer Goods Technology (CGT) event at the Roosevelt Hotel and took the opportunity to see clients.  The rain, President Obama’s visit and a couple of wacky parades made the city a mess.  So, I took to the streets.  I love to walk, and it gave me some great time to think.  As my heels clicked on the pavement, and I dodged a myriad of mud puddles, I thought about the conference.  While there is some movement on the use of downstream data, my take is that the Consumer Products (CP) industry is not making progress on Trade Promotion Management (TPM).  In my view, we are stalled … at a standstill.

It is frustrating and I am not patient.  Trade spend is significant, and the opportunities are great; but the discussions are the same ones that I heard back in 2002.  Yes, I have now been studying the Trade Promotion Management (TPM) market for a decade, and I feel that we are circling the drain. It is painful to listen to the same discussions, see the same mistakes and hear the same vendor pitches over and over again, year after year. Over the week, it became a quest of mine to determine “How can we break the cycle?”   

I count the people that I consider TPM experts on one hand; and last week, many of them were in attendance at the CGT event. So, I pulled up a chair and asked their opinions. No one disagreed.

Over drinks we discussed why the industry had not made more progress on improving trade practices. One person commented that they thought that we had the wrong people on the bus.  The general opinion was that the wheels were going round-and-round and the heads were going up-and-down, but that they were all on the wrong bus going nowhere.  I laughed; but as I walked, I thought about the bus, and decided that the thought had some merit.  Let me ask the advice of my readers.

Most of the attendees at the conference were marketing trade managers or directors of IT.  I feel that they are just in the right positions to drive the bus to drive change.  Here are some direct quotes that I heard at the conference along with my take:

    • “Trade promotion optimization is like teenage sex.  Everyone talks about it; but it is just that, talk.”  This was funny, but true.  It came from a strait-laced guy that I have coached over the course of the last year.  I got him involved in the CGT Trade Promotion Share Group.  His opinion was that he heard the same thing this year as last.  Net/Net:  While the technologies for optimization have improved, I only know of two companies that are doing true optimization of trade spend. The companies were not at the conference.
    • “Picking a trade promotion management vendor is like selecting who to marry in a family of ugly sisters.” Let’s face it, there is no perfect solution for TPM.  While most solution providers take competing postures, most of the solutions are complementary, and no solution is complete.  The acquisition of CAS by Accenture, DemandTec by IBM and ProMax by Wipro makes the decision more complicated. None of the three system integrators do TPM well; yet they have bought a solution.  Net/Net: The selection of a solution is one of the most difficult that I give advice on.  It is messy.
    • “While people are talking about the issues with trade, I am shifting my money to digital.”  Some have just given up. With the advancements in Digital Path to Purchase, I found two manufacturers that are shifting their focus elsewhere.

So, what if you are the Bus Driver?

If you are a project leader for a TPM project, you should first accept that the industry is a mess.  Secondly, you should reach out to the few people in the industry that understand the space.  (If you are a Fortune 1000 company, my short list includes Hans Van Delden from Booz & Co., Rich Essigs from Genpact, Nick Handrinos from Deloitte, Linda Peel from Oracle, and Rob Hand from SAP. If you are a smaller company, my shortlist is slightly different. (If you want more details, shoot me an email.)) At this time, if you benchmark and network, you need to accept the industry for what it is.

So, my advice?  Put the right people on your bus, and determine where to head.  Start with strategy and then determine process and then follow with technology.  And, as you put on your seat belt to start the bus, I would start out in first gear.  It will be a bumpy road with a steep incline.

So, what do you think?  Do you think that we are going nowhere?  Do you think that we need to try new approaches with a new set of leaders to attack the problem a different way? Please let me know your insights.  I will be tweeting from DemandTec’s conference on Tuesday.  I will let you know if I hear anything new.

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