Friday Rant: Pushing the Mission Forward — ISM's Next Chapter

Earlier this week, we provided extensive coverage (Part 1 and Part 2) of ISM's recently announced acquisition of the North American practice and assets of ADR (ADR North America) and ADR North America's China business. For some, our coverage raised more questions than it answered about the future of ISM, including how it views itself on the global stage alongside organizations like the UK's Chartered Institute of Purchasing and Supply (CIPS), which appear to have a much more imperialist -- or would that be mercantile -- approach to fulfilling their mission by prioritizing for-profit initiatives at the expense of what some might argue is in the best interests of a charitable organization.

For example, CIPS has ironically offended the relationship it has built over the years with folks like Peter Smith, a former CIPS Chairman nonetheless! CIPS' for-profit media arm views Peter's blog, Spend Matters UK/Europe, as competitive with their own publications (since when money grubbing journalists/publishers in the trade publishing world trump senior executives in the profession in relationship decisions, I'm not sure). Regardless, as a result, they've banned Peter and Spend Matters from active reference or participation in their own material.

ISM, in contrast to CIPS, has a reputation for acting more as a mission-driven nonprofit with an emphasis on serving its members without putting revenues and margin ahead of relationships. Unfortunately, it also has a historic reputation for moving at a slow pace in reacting to changes in the market from a programming and member perspective, compared to CIPS, Next Level Purchasing (a for-profit US certification competitor) and others.

It's Spend Matters' view, however, that ISM is evolving. From developing a new supply risk conference from scratch to making targeted moves like the recent acquisition to pursuing consulting engagements as a means to get more in touch with its members and the market -- anyone who doubts me that ISM has broader ambitions here should realize how tiny ADR was revenue-wise and how even a substantial growth in revenues of the practice would still make it less than 10% of the size of practices such as AT Kearney's procurement and operations practices -- ISM is moving forward. Slowly, yes: but it's evolving.

Still, ISM has a long way to go to. It's my personal view that the confusion surrounding the recent acquisition is a great case in point that ISM needs to realize how quickly markets communicate today. Simply waiting for a future newsletter or mailing to communicate the essence of what a transaction and formation of a company such as ISM Services, Inc. means for its members rather than communicating directly after the announcement by email to all its members and then actively shaping and participating in the dialogue on Spend Matters, LinkedIn and other online social communities and resources is evidence that ISM is operating an older and slower communications paradigm than where the market has moved.

The future of ISM will be dependent, in large part, based on the actions of its next leader. Paul Novak has done an excellent and commendable job at leading ISM for decades, but upon his retirement, the next leader will need to decide how to best continue fulfilling its mission-driven charter in an era moving at a pace where the flow of information and insight is an order of magnitude faster than what the current ISM is set up to deliver.

It's in all of our interests to see ISM thrive. While no change is easy, how ISM evolves over in the coming years will determine its role and influence in procurement for decades to come. Which is precisely why choosing the right leader to place at the helm is so important at this juncture.

- Jason Busch

Voices (6)

  1. The Purchasing Certification Guy:

    Yep, you’re right. Novak’s contract expires August 31, 2012 and he is not returning per the minutes from their May 14, 2011 board of directors meeting.

  2. Jason Busch:


    I could be wrong, but I thought it was this year.

  3. The Purchasing Certification Guy:

    Why all the talk of the "new CEO?" I seem to remember that Paul Novak not so long ago signed a contract to stay on through 2013 (I think). Are they looking past him already (seems a bit early to write off two years) or is a retirement more imminent than Novak’s contract expiration?

  4. Jason Busch:

    Great questions … I wish I had an inkling. I think in a truly member-driven organization, it’s always the responsibility of the Board and Executive to figure out how best to allocate limited resources to fulfilling the mission and charter. I don’t see ISM becoming a broader consultancy through acquisition — or more generally, growing through acquisition — nor do I see the mission changing much from what it has been. However, the next President will really need to set a new course to drive increasing relevance to make its programming and offerings more indispensable. I have some ideas on what I would do and when the time comes with the new CEO, I hope to have that conversation, albeit in a more discrete forum.

  5. The Purchasing Certification Guy:

    In your opinion, do you think that ISM’s acquisition is a precursor to the acquisition of other consulting firms? In other words, do you think that ISM has the ambition to evolve into a consulting – rather than a membership – organization and thus compete with the AT Kearney’s of the world? Is it noteworthy that Tom Slaight retired from AT Kearney and the ISM board last year and that now AT Kearney does not have a member on ISM’s board (a fact that has seemed to flow under the radar)?

    ISM once had 50,000+ members. As of this Fall, it was down to about 32,000. In my view, ISM is best known for its monthly economic report. Some may say that ISM is in the midst of an identity crisis. What type of organization do you see ISM being 5 years from now: Membership? Consulting? Economic research? Education? Something else? All of the above? You obviously have expertise in the M&A arena, so what are the tea leaves saying to you when you read them?

  6. member in good standing:

    Not to be a twit, but ISM has 1762 followers on Twitter and 40,000+ dues-paying members. Further support for the argument presented here.

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