Comments from Readers: Independence Day Edition Sydney Lazarus - July 4, 2014 2:46 AM | Categories: Commentary | Tags: Incendiary Tidbits, L1 Welcome to another edition of “Comments from Readers,” where we take the most recent and interesting comments and give them a proper shout-out in a blog post. In honor of July 4th, today’s comments are particularly independent – or, if you prefer, disagreeable. The photo to the left was taken in America, of course. Paul Robeson High School’s misspelled prom sign (“This is are story”) prompted Thomas Kase to write a Friday rant on the necessity of competition for quality education, a rant that ends with the suggestion to major in a STEM discipline (science, technology, engineering, mathematics). “Provocative as ever,” writes b&t. “But… if it’s already possible to switch schools, why isn’t Robeson empty? If Robeson has to compete for vouchers, won’t it get even worse? Do you think that after four schools the problem might be you? Doesn’t the US healthcare system expose the limitations of competitions? As does the success of Japanese manufacturing” Thomas replies: “Allegedly it is ‘possible’ to switch schools within CPS, but if you look at the rules for this, the chances are slim, and often tied to a lottery approach. Nothing like what the power of a voucher would offer! If Robeson has to compete – why wouldn’t it get better? No competition clearly isn’t working. I don’t follow the ‘4 schools’ comment? If you are suggesting that some students might be beyond hope, sure, that’s probably true, but I doubt that they will be the ones looking for better academics. I don’t think there is much competition in US healthcare – in fact I can think of few verticals where consumers are as blind in their decision making process as in healthcare. Actual, informed competition is needed, and a lot less regulation. Japanese manufacturing? Do what? (as the expression goes here in the South) Where did that come from?” Then came the obligatory John Adams quote, courtesy of commenter Richard Moore. “I must study politics and war, that our sons may have liberty to study mathematics and philosophy. Our sons ought to study mathematics and philosophy, geography, natural history and naval architecture, navigation, commerce and agriculture in order to give their children a right to study painting, poetry, music, architecture, statuary, tapestry and porcelain.” “I think his quote should be seen as a metaphor rather than as a playbook for his offspring,” Thomas replies. “Read that way, it becomes clear that Adams understood that the foundation (for a successful nation) is one of hard sciences which in turn is built on politics and sufficient military presence. Only with that underpinning can one engage in frivolities like painting and poetry, etc.” “Is fairness a reasonable basis for price negotiation and supplier management?” asks Peter Smith in a Spend Matters Plus post. “Fairness is of course a useful concept to keep in mind when looking at strategic supplier relationships and to understand motivations at individual and business level. But it is of little use when it comes to actually determining how much should be paid for particular goods or services. It is no substitute for much more powerful determinants in the world of economics and procurement – markets, competition, value, and negotiation.” Craig Meadors writes: “Suppliers will try to get ‘fairness’ when they think they can get away with it from an un-informed executive, or when they are having issues and desire to point it at the ‘unfair’ negotiations requiring them to cut costs, or deliver on productivity commitments. That’s why we have benchmarking firms and sourcing exercises – and at the end of the day if someone at the supplier did do a ‘under-cost’ deal, then live with it until you renew. Procurement ‘fairness’ in my experience is based on expected margins by type of purchase or commodity, and the situation (first mover, oligopoly, percentage of supplier’s revenue), and YES it is a factor – to the point that you can use it via your executive sponsors during negotiations (but you have to get them on the same page) – but of course, your individual timing / need can drive you away from ‘fair’ margins to ‘fat’ margins to get it done. As always, it takes two parties to have a contract…so no regrets once you sign or put it out there.” In a post also on Spend Matters Plus, Pierre Mitchell wrote about gamification and its application to procurement, such as a savings contest for top sourcing staff. The first person to comment was Ivy Montgomery, whose name you might recognize as the guest contributor of the mobile procurement series that runs on Fridays. “Imagine most companies have a limit on per night hotel room cost and there are so many travel search platforms out there to give us a good deal. Now, what if every dollar an employee saves from their hotel night goes towards a ‘virtual bank.’ At the end of the year, the money you save goes to a charity of your choice.” Pierre responds: “I like your idea of directing the surplus funds in the virtual bank to a charity rather than just to employee (lessens the ‘gaming the system’ factor) or firm (less incentive to Joe Employee if the savings are merely split between shareholders and to the budget owner to use as discretionary budget), and it’s also tax deductible to the firm.” Now, let’s end with a topic that is connected to July 4th through the margarita. Last month, Mintec looked at the causes behind the spike in the price of Mexican limes, pointing to citrus greening disease and US reliance on exports. Andrew Vandercamp writes in: “While much has been written about the weather and disease driving lime prices higher in Mexico, the media has failed to investigate the competitive landscape in Mexico amongst lime processors and a virtual price war driven by a major player in an effort to dominate the market place. I think this is worth a closer look.” Or will you be drinking vodka instead? Check back later for a rant from Thomas on vodka procurement. Related ArticlesComments from Readers is Back: SAP Sapphire, HANA, and ObjectivityComments from Readers: Proactis's Acquisition of Intesource and Firefox 29 Discuss this: Cancel reply Your email address will not be published. Required fields are marked *Comment Name * Email * Website Notify me of follow-up comments by email. Notify me of new posts by email.