NAPM

International Purchasing Conference & Educational Exhibit

New Orleans 30 April 2000

All Slides Available Monday at

tompeters.com

WOW!

Larry > Bill = Your Moment!

No Wiggle Room!

Incrementalism is innovations worst enemy.

Nicholas Negroponte

It means nothing less than the total reinvention of this company.

Jacques New New Ford

Ford + MSN CarPoint Ford + Yahoo! Ford + Oracle Ford + HP/MCIWorldcom Etc. Etc.

NAPM: Not Purchasing! NAPM: Not Supply Chain Mgt. NAPM =

TE/IR!*

Total Enterprise/Industry Reinvention!

Forget > Learn

The problem is never how to get new, innovative thoughts into your mind, but how to get old ones out.
Dee Hock

Brand Inside Brand Org!

108 X 5
vs.

8 X 1*
* 540 vs. 8

And Now the Equivalent

White Collar Revolution!

The Pincer 5 Destructive entrepreneurs/ Global Competition White Collar Robots THE INTERNET!
[E.g.: GM + Ford + DaimlerChrysler]

Global Outsourcing
[E.g.: India, Mexico]

Speed!!

RR on Sara Lee

The most profitable businesses in the future will act as knowledge brokers, linking insights into whats available with insights into the customers individual needs and preferences.

The &-!!+#$% in the middle* Jim Clark on Healtheon/WebMD

* twixt docs, patients, insurers and providers; $275B of $400B in waste; source: Michael Lewis, The New New Thing

[ Incidentally CEO Jeff Arnold Age: 30 First Start-up: Age 24]

We want to be the air traffic controllers of electrons.

Bob Nardelli, GE Power Systems

Buzzsaw.com Builders, Owners, Architects, Contractors, Suppliers $4T industry 5,300 commercial bldg.-project specs on-line; +70 per day

Message

Supply Chain Integration demands total reinvention of the corporate structure, systems and culture. E.g.

E-business is the final nail in the coffin for bureaucracy at GE.

Jack Welch/ GE Annual Report 2000

Hyperlinks subvert hierarchy!

The Cluetrain Manifesto

Magic!

[Inter]networked Markets
meet

[Intra]networked Workers
Source: The Cluetrain Manifesto: The End of Business as Usual

The Character of the Web, per The Cluetrain Manifesto Hyperlinked Decentralized Hypertime Open, direct access Rich data Broken [no one owns it or controls it] Borderless

[ Words to Live By

Hierarchy is an organization with its face toward the CEO and its ass toward the customer.
Kjell Nordstrom and Jonas Ridderstrale, Funky Business]

Brand Inside Brand Work!

Why are there no books on how to create a Cool, Rocking, WOW-producing Purchasing Department?

You are the Rock Stars of the B2B Age!

[I.e.: Welcome to the Y2K New Orleans Jazz and Real Cool Purchasing Dudes Festival!]

Reward excellent failures. Punish mediocre successes.

Phil Daniels, Sydney exec

You really got to me. So

many of our information technology projects take on a life of their own, and I know theyll never end up as more than mediocre successes.
CEO, F100 financial services company (10-98)

Every project we take on starts with a question: How can we do whats never been done before?
Stuart Hornery, CEO, Lend Lease

The greatest danger for most of us is not that our aim is too high and we miss it, but that it is too low and we reach it.
Michelangelo

Brand Inside Brand Talent!

Issue Y2K

The Great War for Talent!

There is no talent shortage

if
you are a

GPTW*

*Great Place To Work

Our business needs a massive transfusion of talent. And talent, I believe, is most likely to be found among non-conformists,

dissenters and rebels.

David Ogilvy

??????????????????

He grew his hair long, played guitar in a rock band, chased girls, got into trouble. At age 17 he was flogged by his house master, who described him as the most difficult boy Ive ever had to deal with.

Tony Blair*
*talk/May 2000

Brand Outside Context:

No Commodities!

The surplus society has a surplus of similar companies, employing similar people, with similar educational backgrounds, coming up with similar ideas, producing similar things, with similar prices and similar quality.
Kjell Nordstrom and Jonas Ridderstrale, Funky Business

We make over three new product announcements a day. Can you remember them?

Our customers cant!

Carly Fiorina

Were getting better at [Six Sigma] every day. But we really need to think about the customers profitability. Are customers

bottom lines really benefiting from what we provide them?

Bob Nardelli, GE Power Systems

Message (Bud): The distributor is dead. Long live the value-added, knowledge-intensive business partner.

Brand Outside Strategy 1: Lead the Customer!

Wealth in this new regime flows directly from innovation, not optimization. That is, wealth is not gained by perfecting the known, but by imperfectly seizing the unknown.
Kevin Kelly, New Rules for the New Economy

My NAPM Message 04.30.00

LEADERSHIP! PERIOD!

Brand Outside Strategy 2:

Use E-Commerce to Re-invent the Business!

In the network economy, the Website becomes the companys primary interface to the customer. The user interface becomes the marketing materials, store front, store interior, sales staff and postsales support all rolled into one.
Jakob Nielsen, Designing Web Usability

Tomorrow Today: Cisco!*

70% Save $500M (service and tech

support)

Customer Engineer Chat Rooms($1B?) C.Sat e >> C.Sat H

*Earths MVC

Cherry Picking Vertical Markets

Plasticsnet.com: $370B; sellers pay $5K to $8K for storefront; 5% to 10% cut Hook: community services (database, catalogs, forums, industry job bank, etc.)

Message

COMMUNITY!/ COMMUNITY SERVICES!

Begin by filling the stadium.

Then offer more and more services. Hopefully, as you add

more on top, the site becomes more integrated with the work process, until it is invaluable. Carl Bass, CEO, Buzzsaw.com

Community
Somewhat mediated, segmented chat rooms (must be managed/ seeded) User-friendly technical/ professional info Industry intelligence Some very timely stuff/ attractors Hotlinks by the gazillion (to professional and unrelated stuff) Expert/ advisor opinions (info, chats, etc.) Opportunity for users to build own Web page

Message B2B is not the cost cutting program du jour!

Message

Remember the Soft stuff!*

*Soft = Hard [Waterman & Peters]

Message [Paradox]

TRUST RULES!

Speaking of paradoxes

B2B
1999 2004: 50X 2004: $7.4 T
Source: GartnerGroup (per Reuters 1-26-00)

GM/Ford/DaimlerChrysler (02-27)

Auto parts supply Co. $240B (+$500B) I.P.O.

Goal? Drive profits to zero!*

*Remember AMR and dynamic pricing.

Anne Busquet/ American Express

Not: Age of the Internet Is: Age

of Customer Control

Jack on the Webs Naked Truth You desperately want to have enough technology in your product offering, so that you dont end up being in a commodity situation.

Where does the Internet rank in priority?

Its No. 1, 2, 3, and 4.

Jack Welch

There are 2 Kinds of

Defense*
vs.

Offense**
*Fend off upstarts. **Reinvent our marketspace!

Jargon Bath! Bureaucracy free Systemically integrated Internet intense Knowledge based Time and location free Instantly responsive Customer centric Mass customization enabled.

Translation
Bureaucracy free = Flat org, no B.S. Systemically integrated = Whole supply chain tightly wired/ friction free Internet intense = Do it all via the Web Knowledge based = Open access Time and location free = Whenever, wherever Instantly responsive = Speed demons Customer centric = Customer calls the shots Mass customization enabled = Every product and service rapidly tailored to client requirements

Brand Outside Strategy 3: Its the Experience!

Experiences are as distinct from services as services are from goods.

Joseph Pine & James Gilmore, The Experience Economy: Work Is Theater & Every Business a Stage

The [Starbucks] Fix Is on

We have identified a third place. And I really believe that sets us apart. The third place is that place thats not work or home. Its the place our

customers come for refuge.

Nancy Orsolini, District Manager

Experience: Rebel Lifestyle!

What we sell is the ability for a 43-year-old accountant to dress in black leather, ride through small towns and have people be afraid of him.
Harley exec, quoted in Results-based Leadership

Mantra: Any good can be

ing-ed

the driving experience the pumping experience the sitting experience the reading experience the washing experience the cooking experience
Joseph Pine & James Gilmore, The Experience Economy: Work Is Theater & Every Business a Stage

Think

Supply Chain-ing B2B-ing

This is the end of the pure product era. For instance, car makers are beginning to understand that the car is a platform for delivering services that drive the customer experience.
Carly Fiorina, HP @ Comdex 99

Brand Leadership Passion Rules!

Brand Leadership!

A key perhaps the key to leadership is the effective

communication of a story.
Howard Gardner Leading Minds: An Anatomy of Leadership

Brand Leadership: ENTHUSIASM RULES!

I am a dispenser of enthusiasm/ Ben Zander

Message to NAPM: You are Re-invention Evangelists!

Ann Richards Dogma Show up! Know your message!

PUT YOURSELF AT RISK EVERY DAY!

This is your moment. This is your game to lose or WIN. Now!