The truth, however, shall set you free. And the truth is that the Internet makes it awfully hard to keep secrets. It’s not possible to uphold the corporate tight-lipped tradition and at the same time embrace the Internet as a way of doing business. It’s a force to be reckoned with, driven by people who want to know things. Who are these people? They’re customers, suppliers, business partners, shareholders and investors, all of whom are financial partners owed no small amount of gratitude in the form of information.
Transparency has long been a hallmark of American business. But the Internet has revealed that U.S. corporations aren’t nearly as transparent as they should be. This revelation has come about in large part because of the huge number of average Joes and Janes that have poured into financial markets as a direct result of their excitement over technology. Individuals now have more invested in the stock market than traditional institutional investors. They keep investment Web sites like Raging Bull’s very busy by making it their business to know what’s going on inside the companies into which they’ve poured money.
On any given night, company insiders are all over the Web, sharing fascinating insights into their companies on the discussion boards. (Corporate spies, too.) Once taboo subjects such as executive pay and perks, directors’ honorariums, employee problems, bad investments and research and development on new products are all fair game for the online enjoyment of millions. Think Nike and sweat shops. Microsoft and internal e-mails. Oracle and dumpsters.
The Internet tips the scales in favor of the public’s right to know versus a company’s need to keep its internal workings secret. It’s too darn late to pull the plug, but the timing couldn’t be better for purchasing and supply chain management professionals to leverage their knowledge about what is and isn’t truly proprietary within their sphere of influence. Purchasing as a strategic function will change, and getting up to speed on e-procurement technology will go far in keeping the right cats in the bag while satisfying business’s numerous and frenzied stakeholders.
A Vision of The Present
Idealists minimize difficulty, while optimists overcome it. The Internet was invented by optimists to get information from here to there. Pretty simple. People are the most complex component. For the Net to serve its purpose, people need to be free to use it, and to be free, the organizations they work for have to lighten up. Any loss of competitive advantages that now reside in proprietary information and other strategic competencies need to be compared to the benefits of speed, responsiveness and better knowledge management. Openness doesn’t require giving away the store, or even the keys, just dusting off the shelves and opening up the windows.
We leave you with a concrete example provided by Venancio Figueroa at Dell: “On the back-end of the web-enabled supply chain, we have a portal called valuechain.dell.com (password protected) where we share information such as product quality and inventory with our suppliers. We are extending the use of the Internet to also provide more real-time views to suppliers so they can see the demand we’re getting from customers and, from a Dell standpoint, we can see the suppliers’ availability. Given that we have deep relationships with suppliers - about 30 to 35 different suppliers provide Dell with about 90 percent of our materials - we need this visibility. Using the Internet in procurement gives us the immediacy and the flexibility to focus on collaboration, inventory management, seeing the “work in progress” from suppliers, and having them see the dynamic changes in our schedule...”
He closes with, “I hope this helps you.” Now there’s a breath of fresh air.