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G-20 summit a success - is the world really getting "flat" ?

It is not just travel,communication and the Internet -that's turning the world flat as Thomas Friedman famously pointed out. The most amazing  image from the G-20 summit is of  Queen Elizabeth and First Lady Michelle Obama putting their arms around one another. When there was a gasp of protest from royal watchers, Buckingham palace quickly quashed any concerns about breach of protocol. It tells us a lot about the British Monarch  who recognizes the changing "flat world".

The camaraderie of the G-20 leaders also sent a strong message to businesses around the world  that we live in one world and must work together to solve the problems of our time, notably the current economic crisis.

Does this mean that all Governments are on the same page? Will global B2B and supply chains  become seamless - immediately?

Or at a more mundane level will wireless phone providers  start charging the same domestic price for global roaming? Not immediately but we'll get there probably sooner than we imagine!

And change in modern cultures- Barack Obama

Barack Obama is the President Elect of the USA. Not many "young" cultures or countries or even "older" ones can claim to usher in such change. Remarkable and only in the USA !

An interesting dynamic of this election is the support of the American youth for Barack Obama. The Obama campaign was able to galvanize the youth,turn them out and since the Generation Y or echo boomers have great relations with their parents and grandparents this historic change became possible as the young were able to persuade their older relatives.

Now, time to get back to work!

Worldsourcing-made in this planet

Kudos to William J. Amelio  of Lenovo for coming up with, and promoting the concept of "worldsourcing". Today Business Week  carries a story and this earlier piece on BBC is also enlightening. Bill Amelio advocates lightening up on the "outsourcing" label and the superior attitude that prevails in the wealthier countries vis-a-vis the booming but earlier poorer countries,particularly of Asia. According to Amelio, thinking of the world as one market and therefore one sourcing point suddenly opens up great possibilities for both picking up innovative ideas and developing new markets with a global well oiled supply chain and distribution channel.

Jack Welch, in one of his books recalls how one of his senior managers in GE was disdainful of  his direct report Indian scientists for no other reason than their location as they operated out of the GE India facility. With "neutron" Jack, the manager off course, did not last long and GE went on to become a leader in what Bill Amelio calls "worldsourcing." Indeed, thinking of the world as one place and one opportunity suddenly changes the scene, not only for big business but for the smallest entrepreneur.Quite simply, some places in the world are booming as markets and excellent low cost suppliers are eager to serve your business from other parts of the world.More flexibility and openness is what is called for....
   

Corporate Social Responsibility

Last week my article in the Inside Supply Management of December 2007 appeared in print. This is a short piece on Corporate Social Responsibility and what the supply manager can do to contribute to Corporate Social Responsibility. I talk about three areas first the Global Supply Chain and quality problems (eg. toy recalls), supplier diversity for global suppliers and greening of the supply chain. All three topics are important for the supply manager, going forward and things that would resonate with enlightened CEO's and company boards. Inside Supply Management is well circulated and is a monthly publication and covers some great and relevant content. The article itself can be downloaded here.

Muhtar Kent at Coke and Indra Nooyi at Pepsi and the Bottom of Pyramid

Muhtar Kent is the new CEO at Coke. This blog had commented on the changes at Coke earlier this year and the elevation of Mr. Kent to CEO is indeed a great development. Not only is Muhtar Kent, of Turkish origin,  eminently qualified but his elevation signals Coke's  diversity  comeback . It also makes good business sense. Good business sense because as Fortune reports, Muhtar Kent led the Coke efforts in Eastern Europe after the Berlin Wall and should be able to lead the market expansion in emerging markets of the developing world. These markets have been called the "Bottom of Pyramid"(BoP)  and involve most of the world where per capita income is low but human aspirations are high. A person drinks soda as a special treat and serving sizes are low ( about 6 -8 fl. oz. vs. 12 fl.oz. in the US) to keep soda affordable. These markets use bottles not merely because of "green" concerns but because a large unskilled  labor pool is able to move bottles at low cost across the distribution chain. Growth for US consumer products will come from these markets and the CEO must understand how these markets actually work.

Pepsi in the meanwhile has India born Indra Nooyi at the helm and the BoP Cola wars should be interesting.

From supply chain to "global value chain" a report from NECON 2007

I returned from NECON 2007 and was struck by a major change in the supply profession from 2006. In three  words "global value chain," in contrast to the narrower "savings" theme of the previous year.

While in 2006 there was some talk about managing the global supply organization and global suppliers - this time I found a distinct shift in the way speakers addressed these two issues. Large corporations like Pfizer are clearly thinking globally for both managing the supply organization and suppliers. The ISM Chair Lisa Martin's talk was just superb and covered the global value chain imperative succinctly.

Stephen Slade's  talk explained how software today can help with making the entire value chain more visible across global operations.Similarly the panel discussion on outsourcing clinical trials had a star panel of both buy and supply side experts and the panel brought out the complexities of the global contract research process.

I was motivated by all the exciting sessions to add slides to talk some more about the "low cost country" aspects rather than only focus only on the difference between business processes and knowledge processes. I too emphasized the "value" chain perspective in the context of low-cost country sourcing.

Overall, a great conference !

Implicit Assumption Test- IAT and our hidden biases

The Implicit Assumption Test from researchers in  universities including Harvard,Yale,Wisconsin is making news about something that we know but do not realize. According to their information page  80% of the web visitors have negativity towards the elderly. As web users get older this should change! Interestingly, 75-80% of self identified whites or Asians  show an implicit preference for whites over blacks. Just count the relatively large number of white models in Asian TV advertising and you'll know that this data is correct.

Having become an academic relatively recently and always trying to get through the academic publication process I can say that we may not like the test's results but it is a pretty reliable test. It has to be if the authors have been publishing academic articles from the results going back to 1998. I thought this blog should weigh in on the validity of the test because there  is  some dispute in  blogosphere because probably the results tend to shock you.

Anyway the IAT is free, takes five minutes. It basically tries to classify various stuff into "good" and "bad". Then it classifies images into European American and African American. Then it tries to figure out what racial type you tend to associate with "good" and what racial type you tend to associate with "bad" and whether you are biased towards one race or the other. The thing that surprised me the most was that only 17% test takers are really unbiased. But take the test- it's worth your five minutes. The IAT is here.

Outsourcing Diversity

Outsourcing is not simply to reduce cost and potentially improve efficiency and increase innovation. It clearly is a way of getting a contractor or business partner to do "non-core" things which you cannot do, unable to do and perhaps think that you don't need to do.

One interesting recent story is  about big organizations who want their big legal firms to have more minority lawyers- particularly at the partner level. But minority lawyers are difficult to hire and retain by the bigger law firms simply because these firms are predominantly white and minority lawyers feel "out of place." Several big law firms have come up with an interesting alternative. For example, in this story from the "Minority Law Journal"  of May 12, Dimitra Kessenides mentions that the law firm Sonnenschein, Womble and Venable has tied up with minority firm  Brown & Sheehan. Together they are pitching for business and this is opening up new opportunities for Minority Law firms. However, the concern in the article is whether the bigger law firms are simply "outsourcing" the diversity "problem." On the other hand Minority Owned Law firms will have an opportunity to shape diversity inside the big firm. Interesting....