Failure to Manage Your Suppliers Usually Results in Failed Outsourcing Relationship
Why do some outsourcing relationships shine and others fail miserably? A new study by Capgemini and CFO Research Services, “Outsourcing the Back Office: The Path Toward Sustainable Benefits,” produces a blueprint for successful outsourcing efforts. It dissected the relationships that fell apart and spotlighted those that produced stellar results. And then it listed nine action points if you want your outsourcing relationship to hit a home run.
Here's the Cliff Notes version of the secret sauce: Outsourcing relationships failed when buyers did not follow best practice policies in either selecting or managing their suppliers. On the other hand, when buyers took "appropriate care" in these two areas, "real benefits followed." Sixty-nine percent say their management of their suppliers determines the success of the relationship.
Source: Outsourcing Journal, http://www.outsourcing-journal.com/

Those Legacy Systems Weren't Cheap to Begin With ... and You're Still Paying for Them, Aren't You?
Businesses are still being haunted by the ghosts of last decade's enterprise-software buying spree. The ongoing need to support a host of legacy systems amounts to vendor entitlement payments that keep IT costs high and impede CIOs' ability to launch revenue-generating initiatives. It's bad enough that these systems were difficult and expensive to install initially; they're proving no less expensive to maintain and support for the foreseeable future.
Source: Optimize, http://optimizemag.com/

Shallow Talent Pool Could Be Significant Barrier to RFID Adoption
While mandates from the likes of retailing giant Wal-Mart and the U.S. Department of Defense is still a key market driver for RFID implementations, more and more manufacturing and distribution companies are exploring options for making better use of all that RFID has to offer. They understand that many of the benefits of the technology — better supply chain visibility and reduced out-of-stock — will be realized only by devising a long-term strategy beyond mandate compliance. By 2010, Gartner forecasts worldwide RFID spending to surpass $3bn.
But there remains an elephant in the room that organizations have only recently began to notice; and it's large enough to threaten the success of many RFID projects.
A survey conducted earlier this year by the Computing Technology Industry Association found that RFID deployments continue to be hampered by a shortage of individuals skilled in the technology.
Seventy-five percent of the companies responding to the survey said they did not believe there is a sufficient "pool of talent" in RFID technology to hire from. Among companies that believe there is a talent shortage, 80 percent said the lack of individuals skilled in RFID will impact adoption of the technology. The figure is significantly higher than a year ago, when 53 percent of responding companies said the shortage of talent would have a negative impact on RFID adoption.
Source: Industry Week, http://industryweek.com/

Three Crucial First Steps Before Any CRM Implementation
Before implementing a CRM solution, it is important for enterprises to define the indicators specific to their customers, market segments, and business services that gauge business performance. There are three steps to this process:
(1) Distilling the insights that enable the right business indicators to be defined in a way that can be tracked and managed;
(2) Developing reports and other tools that facilitate tracking the indicators; and
(3) Analyzing the indicators and changing the business in reaction to the insight it provides.
This sounds simple, but it is typically the most difficult and rewarding process that a client can undergo.
Source: Line 56, http://www.line56.com/

Suppliers to High-Tech Industry Build in Protection from Delays
Sony's delay of the PlayStation 3 and Microsoft's delay of Windows Vista made big headlines this spring. But the delays didn't make a big difference to vendors whose components go into the PlayStation or into PCs souped up to run Windows Vista, according to vendors, distributors and analysts.
Any supplier of important components for a major new product has "teams of people on site at these major companies," says Jon Peddie, president of Jon Peddie Research. "As things happen by the minute, almost, and certainly by the hour, the partners know about it."
In addition, since the dot-com bust, vendors are more careful about protecting themselves. Many craft contracts with their customers and make more use of consignment (vendor-managed) or bonded inventory. They create electronic links with customers that instantly alert them to a change in demand for their products—and even a delay in the final assembly, package and test of semiconductors—until it's clear they'll be needed.
Source: Electronic Business, http://www.reed-electronics.com/

Attention to Cultural Nuance May Mean Difference Between Business Success, Failure Abroad
When Russ Finney travels to Japan as the CIO of Austin-based Tokyo Electron America Inc., he knows that many of the strategy sessions in which the biggest decisions will be made won't take place in conference rooms or board meetings, but in restaurants and nightclubs.
During the dozen years he's been in his role, Finney has learned a lot about the differences in management styles and cultures between the U.S. and Japan, including a tendency among Japanese businesspeople to make decisions in informal, after-hours settings. "Learning the subtleties in the business culture is an art, and it takes a person who wants to gain a deeper understanding of those cultural differences," says Finney.
CIOs of U.S. subsidiaries need a combination of keen observation skills, social savvy and intuition to strike up successful relationships with executives half a world away. "There are no right or wrong cultures, but some Americans perceive that the American culture should be the global norm," says Don Southerton, president and CEO of Bridging Culture, a consulting firm in Vista, Calif. That kind of mind-set will get you into trouble, he says. "The most challenged American executives are those who have the least global experience," says Southerton.
In contrast, successful CIOs pay careful attention to cultural nuances when they interact with foreign managers.
Source: Computerworld, http://computerworld.com/

Wal-Mart to Try Customer-Focused Approach to Determine What to Stock in Each Store
Officials at Wal-Mart are analyzing how to cater stores to regional demographics, a move that could mean, for example, more tourist- or retiree-focused items in given locations.
Senior executives announced plans recently to tailor the product mix and interior design to five shopper categories: suburban affluent, rural, boomers, urban/multicultural and Hispanic. Wal-Mart officials said they hope to implement the plan next year.
"We want to understand our customer mix better," Wal-Mart spokesperson Michael Mills says. "There's a wide range of folks that shop at our stores. We want to stock our shelves accordingly."
Source: CRM Buyer, http://crmbuyer.com/

Kimberley-Clark to Implement Internet Telephony, But Only Selectively and Gradually
For a company that sells billions of disposable consumer products each year, Kimberly-Clark is applying a conservationist's approach to its VoIP and IP telephony plans.
The VoIP plan at Kimberly-Clark is to consolidate voice traffic for more than 200 sites into three data centers while retrofitting existing Avaya PBXs with gear that will turn the devices into digital/VoIP gateways.
The revamped PBXs will let the company keep the tens of thousands of digital handsets now in use while centralizing its call processing and messaging applications. That move could save close to $10m in new IP phone costs if Kimberly-Clark upgrades its sites to VoIP while saving half its Avaya digital phone installed base.
"IP handsets will be more of an exception, rather than the rule" in the VoIP road map, says Mike Post, senior manager of IT communication services for the Irving, Texas, company. "For our business and how it operates, we didn't see a great amount of value in deploying IP phones widely . . . so we're going to try and keep our digital sets wherever we can."
Source: CRM Daily, http://www.crm-daily.com/

Just What Do You Know About the Trains Your Goods Are Riding On?
Hidden in the bad press about oil prices is a little-known fact: Rail freight is the hottest sector in the transportation industry. And one of the reasons it is so hot, $3.50 per-gallon gas prices notwithstanding, is that just-in-time manufacturing is pushing the railroads and shipping companies to pick up the slack for trucking — which is suffering from a lack of drivers and serious fuel economy problems. Yet, what do you, or most shippers, know about rail freight and how it works? Probably not much, but you should.
Source: Managing Automation, http://www.managingautomation.com/


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