For years—okay, decades—I have discussed the importance of using an agent-based versus equation-based model to successfully implement technology solutions, including AI.
I have also discussed the Government of Canada’s Scientific Research & Experimental Development (SR&ED) program funding my research into the use of self-learning advanced algorithms that led to the development of one of the first web-based nascent AI platforms for MRO procurement. As a side note, I also lamented the fact that I sold the company for $12 million in 2001. That is a discussion for another time.
The Model, The Execution, The Logic, and The Outcome
The Model – “Based on 25 years of research and supporting case studies, we must refrain from prescribing a siloed, formulaic approach to complex challenges. Instead, we must understand the unique operating attributes of stakeholders within and external to the enterprise and then implement adaptable solutions, e.g., an agent-based approach.” – Agent-based versus Equation-based modelling: What every procurement professional needs to know
The Execution – “When organizations make the mistake of leading with technology, they are bending their people and processes around an equation-based model approach in which the tech is the driver for success.
When you lead with people and process understanding – an agent-based model, technology moves from a functional driver to a problem-solving tool that streamlines and delivers efficiencies and tangible results.” – Are you chasing solutions or solving problems? (Part 1 of 3)
The Logic – “I want to re-emphasize this one point: the groundwork for what we accomplished occurred before the technology was introduced.
One of the first things I did was understand what role the other stakeholders or “agents” played in procurement’s success.
For example, the field service technicians had their “own” processes, performance targets, and technology. How did this impact procurement’s ability to procure and ensure timely “next-day” delivery of a quality component at the best cost?
What about suppliers? What impact did geographic location and Time-Of-Day (TOD) have on product cost, quality, and delivery performance?
Unfortunately, in the past—and unfortunately, in the present day—most organizations never looked outside the department when deciding on a solution to improve the procurement process and performance. This siloed thinking meant that no matter how well the technology worked, technology underperformance and failure were inevitable outcomes.” – Are you chasing solutions or solving problems? (Part 1 of 3)
The Outcome – “In August 2003, the new technology successfully went live in a production environment for the DND. In this test case, the public sector organization realized a year-over-year 23% cost of goods savings for seven consecutive years while simultaneously reducing the number of buyers required to manage the contract to 3 from an original 23. Delivery performance and product quality also improved dramatically.” – Are you chasing solutions or solving problems? (Part 1 of 3)
Video Replay
Today’s Takeaway: Before implementing technology, make sure you understand the role and influence of all internal and external stakeholders on your success, then “Turn The Beat Around.“
Procurement Insights 
Music and Predicting the Stock Market: What Every Procurement Professional Should Know!
Posted on June 16, 2024
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The Video
For years—okay, decades—I have discussed the importance of using an agent-based versus equation-based model to successfully implement technology solutions, including AI.
I have also discussed the Government of Canada’s Scientific Research & Experimental Development (SR&ED) program funding my research into the use of self-learning advanced algorithms that led to the development of one of the first web-based nascent AI platforms for MRO procurement. As a side note, I also lamented the fact that I sold the company for $12 million in 2001. That is a discussion for another time.
The Model, The Execution, The Logic, and The Outcome
The Model – “Based on 25 years of research and supporting case studies, we must refrain from prescribing a siloed, formulaic approach to complex challenges. Instead, we must understand the unique operating attributes of stakeholders within and external to the enterprise and then implement adaptable solutions, e.g., an agent-based approach.” – Agent-based versus Equation-based modelling: What every procurement professional needs to know
The Execution – “When organizations make the mistake of leading with technology, they are bending their people and processes around an equation-based model approach in which the tech is the driver for success.
When you lead with people and process understanding – an agent-based model, technology moves from a functional driver to a problem-solving tool that streamlines and delivers efficiencies and tangible results.” – Are you chasing solutions or solving problems? (Part 1 of 3)
The Logic – “I want to re-emphasize this one point: the groundwork for what we accomplished occurred before the technology was introduced.
One of the first things I did was understand what role the other stakeholders or “agents” played in procurement’s success.
For example, the field service technicians had their “own” processes, performance targets, and technology. How did this impact procurement’s ability to procure and ensure timely “next-day” delivery of a quality component at the best cost?
What about suppliers? What impact did geographic location and Time-Of-Day (TOD) have on product cost, quality, and delivery performance?
Unfortunately, in the past—and unfortunately, in the present day—most organizations never looked outside the department when deciding on a solution to improve the procurement process and performance. This siloed thinking meant that no matter how well the technology worked, technology underperformance and failure were inevitable outcomes.” – Are you chasing solutions or solving problems? (Part 1 of 3)
The Outcome – “In August 2003, the new technology successfully went live in a production environment for the DND. In this test case, the public sector organization realized a year-over-year 23% cost of goods savings for seven consecutive years while simultaneously reducing the number of buyers required to manage the contract to 3 from an original 23. Delivery performance and product quality also improved dramatically.” – Are you chasing solutions or solving problems? (Part 1 of 3)
Video Replay
Today’s Takeaway: Before implementing technology, make sure you understand the role and influence of all internal and external stakeholders on your success, then “Turn The Beat Around.“
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