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My Employer, NRECA, in Computerworld's Top 100 Best Places to Work (Again)

Just like last year, the year before that, the year before that, etc., my employer (NRECA) is in Computerworld's Top 100 Best Places to Work.  This year, NRECA ranked 4th in the Career Development category and 68th overall.

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You Must Be Strong to Overcome the Sexy Sirens of Procurement

Sirens are best known for using their captivating beauty and sweet singing to lure mariners and their ships to destruction.  There are many classic tales, such as Homer's Odyssey, which warn of the dangers of sirens.

Allow me to be your Homer--but more in a Simpsons' "Doh!" kind of way--to warn you of the Sirens of Procurement.

As procurement pros, we have to be a jack of all trades and a master of one.  The "one" to be a master of is obviously procurement.  The "all" means that procurement pros need to have an understanding of the customer's business so that the required goods and services can be appropriately sourced.  Mostly, procurement pros are "generalists," and have a broad knowledge of their employer's business in order to source general categories of buys such as MRO and professional services.  Sure, these procurement pros might be a little bit more versed in one commodity over another, but a generalist's real value is adaptability--to think fast on his or her feet so as to effectively assist in a procurement without having to expend too much time getting up to speed on the customer's business.  The great thing about being in a generalist procurement role is that you get visibility to many, if not all, parts of your employer's business.  In the span of one day, you might help HR find a new recruiting firm, negotiate a contract for an external auditor on behalf of your Finance department, and resolve a contract dispute between IT and a software vendor.  Not many jobs provide that much variety or the ability to impact the business so broadly.  How cool is that?  Unfortunately, the coolness factor is where the Sirens of Procurement beckon to unwary procurement pros.

The Sirens of Procurement dwell within the business units and make the customer's business very, very attractive and appealing to procurement pros.  Procurement pros who allow themselves to be distracted by the daily grind of vendors, customers, rushes, and disputes are particularly susceptible.  When working with their customers, these harried procurement pros can hear the Sirens of Procurement faintly singing something to the likes of "What the customer does is really cooooool.  You want your customer's joooooob.  Procurement suuuuucks."  These procurement pros become mesmerized by the Sirens of Procurement, thinking that their generalist level of knowledge puts them on par with their customers, and that the procurement pro is as equally qualified as the customer to do the work of the customer.  What the Sirens of Procurement don't tell you is how difficult the customer's job really is, how not qualified you really are to do the customer's job, and how wrong the Sirens of Procurement are about procurement sucking.

As a manager of procurement pros, I've seen it happen enough with my staff to prompt me to write about it.  Over the years, I've seen the Sirens of Procurement fool some of my staff into thinking that they should be in the customer's career field.  I'm not against people changing career fields to something that they really want to do, but I don't want people making misinformed "grass is greener" life-altering career decisions.  I can speak from experience to the "grass is greener" problem as well because I've seen folks go from procurement into the business, not do so hot, and then struggle to make their way back into procurement (sometimes without success).

So how can you help yourself or your staff from falling for the Sirens of Procurement?

First, recognize the symptoms:
  • Becoming too engaged in one customer's business at the expense of other customers and other deals.
  • Believing you know better than customers when it comes to their business, second-guessing customers, or by making criticizing comments about customer decisions.
  • Requesting training that goes beyond what is really necessary to understand the customer's business.
  • Requesting training for business-specific certifications (such as IT certifications) under the guise of "it gives me more credibility" with the customer.
Second, make sure that you or your staff are making an informed decision about the customer's career-field:
  • What is the pay range in the customer's business?  (Procurement pros are generally well-paid, frequently making more than the customer-equivalent level.)
  • If the pay range is lower, are you willing to take a pay cut?
  • Based on your real (not perceived) experience and qualifications, where would you start at on your customer's career ladder?
  • Are you willing to take an entry level position because you really don't have the required experience and qualifications?
  • If you don't have the necessary education, are you willing to go back to school while working full-time?
  • Is your customer's career field recession-proof?  (Procurement generally is...)
  • If your employer doesn't have an opening, are you willing to leave the company / possibly relocate?
  • Do you really understand the daily grind of your customer's job?
  • Do you acknowledge that coming back to procurement isn't a slam-dunk?
Third, recognize how interesting and fun procurement really is:
  • Procurement is a recognized and respected profession with career progression.
  • Procurement usually pays extremely well.
  • Procurement allows you to truly impact your employer's business and bottom-line.
  • You get to work on a never-ending variety of procurement projects.
  • There's a lot of visibility in procurement and you get to rub shoulders with "execs."
  • Dealing with vendors can be, ummmm, challenging and rewarding.
  • You get to negotiate.
When you hear the singing of the Sirens of Procurement, block them out and don't let them lure you astray.  Know that your procurement role is important, interesting, fun, and rewarding.  In fact, if you could read minds, you'd probably find your customer thinking, "Hmmmmm...  Procurement seems really cool.  I wonder how I can get a piece of that..."

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Force Majeure = Get Out of Jail Free

Thanks to one of my staffers, Rebecca Mordas, Esq., for writing this article!

The force majeure clause is like a Monopoly “get out of jail free” card in the sense that a nonperforming party is permitted a legal excuse, based on the occurrence of a catastrophic event, to breach a contract without suffering the consequences of nonperformance.  A typical force majeure clause legally excuses or suspends a party’s obligation to perform when a specified event occurs.

 

Because one party may be more vulnerable to the consequences of certain events occurring, the force majeure terms should not be overlooked.  Generally, force majeure clauses are set up in either of two formats.  The first format enumerates a list that includes all of the events that could plausibly excuse performance.  If you have adopted this format, be sure to occasionally update your list as current events may not be covered.   Take the outbreak of the swine flu as an example: have you revised your force majeure clause to shield a party from nonperformance resulting from the outbreak or threatened outbreak?

 

Additionally, if you enumerate your force majeure events, be careful if ending your force majeure provisions with the terms “…and other similar causes.”  Courts may construe this catch-all provision narrowly to comprise only causes of the same sort as the previous matters mentioned.  You should buttress the catch-all provision with the additional phrase “…and other similar causes which are beyond the control of the parties.” to allow some flexibility in excusing unforeseeable events.

 

The second format used in force majeure provisions is a definitional approach in which the parties set the criteria to determine when the occurrence of an event will excuse performance.  Lawyers prefer this format as it is subject to finite interpretation.  If you desire certainty, the first format may be more amenable to your purposes.  However, if you prefer the flexibility of this second format, make sure your force majeure provision incorporates both foreseeable and unforeseeable events.  Courts have been known to find that if an event was foreseeable, the parties should have protected themselves during negotiations, and in the failure to do so, the burden remains with the nonperforming party.

 

A hybrid of both these formats may be used in constructing your force majeure provision.  In the following excerpt from NRECA’s  hotel contract template, the force majeure provision reads:

 

Force Majeure.  The performance of this Agreement in whole or part by either party is subject to acts of God, war, or similar hostilities, actual, threatened or suspected terrorist activity, government regulation, disease, World Health Organization travel advisory, disaster, fire, strikes, threat of strikes, lockouts or labor disputes (except strikes, threat of strikes, lockouts or labor disputes involving the party attempting to invoke this provision), civil disorder, curtailment of transportation facilities unreasonably delaying at least twenty-five (25%) of Attendees from attending, or similar or dissimilar causes beyond the control of the parties making it inadvisable, commercially impractical, illegal, or impossible to hold the Meeting or which materially affects a party’s ability to perform under this Agreement. 

 

Notice that this provision includes the first format by creating a list of specific events which could excuse performance; however, this list is by no means exhaustive.  It functions like the second format to allow the nonperforming party the flexibility to plan for unforeseeable events by establishing the conditions that would justify an excuse. 

 

Regardless of your format preferences, make sure the nonperforming parties obligations are outlined within the force majeure provision.  Remember that fairness is the basis for the force majeure provision; therefore, fairness should govern the duration and terms of a parties’ ability to suspend and continue to suspend performance.   As the performing party in any force majeure scenario, you would like some assurance that the other party is acting in good faith and in a commercially responsible manner.  To protect the performing party and the integrity of the contract, the nonperforming party should be required to give notice of their inability to perform within a certain time frame from becoming aware of the event.  Requirements should further compel the nonperforming party to provide a written statement that asserts their expected delay and explains how the nonperforming party will mitigate or limit damages to the performing party.    

 

The force majeure provision is a powerful risk-shifting mechanism because it has the effect of allocating risk from one party to another based on the occurrence of an event.  Review your force majeure provision today to ensure that you have protected your company from the occurrence of catastrophic events which would prevent your performance and that your company has not absorbed too much of the risk that these catastrophic events will occur. 


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Your Procurement Department is a Money-Sucking Cost Center! (...but it doesn't need to be)

Sometimes budget centers, such as a budget associated with a certain department, are referred to as "cost centers."  When a department is referred to as a "cost center," that's not necessarily a good thing.  What "cost center" means is that the associated department "costs" a company money and doesn't produce any revenue.  In contrast, a budget that produces revenue is called a "P&L," and a P&L is good especially if there's a lot of P and no L.  Basically, a cost center is the reverse--no P and a lot of L.

When companies look to cut costs during tough economic times, they typically look very closely at cost centers and not so much at P&Ls.  Cost centers that don't provide a whole lot of value get their budgets slashed (or the departments are eliminated entirely) when the economy goes South.  P&Ls tend to be luckier in that regard.

Guess what?  Your procurement department is a cost center!

Sure, you can argue that your procurement department directly impacts your company's bottom-line through cost savings, that your procurement department lowers operational and legal risk for your company (and therefore costs), that your procurement department extracts more value from vendors by managing performance, that your procurement department blah, blah, blah...

Regardless of all that, your procurement department is still a money-sucking cost center.

But it doesn't have to be that way...  Your procurement department can actually be a P&L!  You might have a lot more L than P, but at least you're not just draining money from company coffers.  So, you ask, how the heck can a procurement department "generate" revenue!?  Well, here are some examples...

Vendor Discount Programs.  Many companies have vendor discount programs for their employees, such as discounts for online retailers like florists, book companies, and rental car agencies.  As an employee perks program, most companies sign up with a boutique firm that offers a set of these types of discounts for "free!"  Why do you think these boutique firms are willing to do that?  Because they get a kick-back, that's why!  As procurement pros, you should cut out the middleman and set up discount deals yourself with online retailers.  Sometimes you won't be able to get actual cash, but you'll get something tangible which is just as good.  Last year, my employer--specifically, my "cost center"--received over $200K in cash, numerous free software licenses, and 6 laptops through our vendor discount program.

Reseller Points.  Most large IT resellers facilitate the receipt of manufacturer points based on volume spend.  As a result of the relationship I have with my reseller, my employer received over $10K in various items such as printers, scanners, and digital cameras.  Thanks HP!

Leveraging Travel Agencies.  Similar to reseller points, if your company's employees do a lot of travel, travel agencies can arrange reward programs with airlines and hotels.  As a consequence, I rarely have to pay for airfare for my staff to go to external training.  I estimate that this resulted in about $15K in airfare and hotel stays last year.

P-cards with Cash Rebates.  Just like personal credit cards with cash award programs, the same goes for p-cards.  You just have to bargain for it and then drive everyone in your company to use p-cards.  If I can pay for any of my company's procurements with a p-card, I do.  I've purchased hundreds of thousands of dollars in software licenses so I could bump up my p-card spend.  In 2008, my employer received over $125K in case rebates from our p-card provider.

Speaking at Procurement Conferences.  Most conferences or events will give free registration for speakers.  Some even pay travel expenses.  Needless to say, my staff are strongly encouraged to speak at any conferences or events they would like to attend during the year.  No speaking = lower likelihood of staff attendance.  Last year, my staff and I spoke at no less than 10 conferences or events that would have otherwise cost me $10K in registrations, airfare, hotels, and meals.  Yeah, free training!

Net-net.  So, if I sum all of the above up, my procurement department generated over $350,000 in "revenue" in 2008.  In 2009, I've projected about $400,000 due to an increased number of online retailers in the vendor discount program.  My boss is a generous guy, so, while some of my revenue does go back to my employer, he allows me to reinvest a good chunk of the revenue back into the procurement department to acquire the tools and resources needed to get our job done.

P.S.  Thanks to one of my staffers, Donna Jackson, Esq., for pointing this out as a potential blog article.

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Procurement Pros and Sales Pros: The Yin-Yang of the Business Universe

Let me start off with a bold, controversial statement...  Procurement pros should be in sales...  Procurement pros / sales pros are natural dualities, the yin and yang, the Jedis and the Dark Side, oil and water, day and night (you get my drift)--but that doesn't mean that one can't learn from the other.  To that end, sales pros spend a significant amount of time understanding the nature of procurement and how to work around procurement pros.  For example, sales pros are specifically trained on how to do end runs around procurement to schmooze who the sales pros think are the decision-makers.  With that being the case, why not do the same with procurement pros?  Meaning, why don't procurement pros dabble in the black art of sales?

We all know that relationships matter, and that's the bread and butter of sales pros.  A seasoned sales pro will establish a relationship with a customer and manipulate that relationship to the nth degree to maximize their sales revenue and commissions.  In the words of the very talented Jerry Seinfeld, "Not that there's anything wrong with that."  Leveraging relationships is a crucial part of business...  Our job as procurement pros is to help level the playing field between customer and sales pro.

So, ask yourself, what are you doing as a procurement pro to leverage relationships with your internal customers?

Your likely response to that question is exactly my point, and why procurement pros should be in "sales."

Just like sales pros, my staff have quotas in their performance plans, but instead of revenue quotas, my staff have savings quotas.  They are measured and compensated on those quotas.  If my staff don't hit those quotas, they get zinged on their merit increase.  They exceed those quotas, and they get more $$$.

In addition to commissions, many companies use special incentives to motivate and compensate their sales pros (called "SPIFs" or "Sales Performance Incentive Funds").  SPIFs can be cash or other incentives like travel or gifts.  Well, I do the same thing.  I have "Special Procurement Incentive Funds."  If one of my staff do extraordinarily well on a big deal, they get an on-the-spot cash award, free time off, or a work from home day.  Over the years, I've given thousands of SPIF dollars away and lots of time off.

Sales pros have the job of determining your customer's "needs," so sales pros will meet with your customers to get them to divulge this information.  Yep, my staff do the same thing.  Every year, at the beginning of the year, my staff are required to meet with budget center managers who have made large capital and expense requests.  The purpose of the meeting is to understand what the customers have in their pipelines for the year.  In these discussions, my staff reiterate how we can help the customer through the procurement process, make it easy for them, and, most importantly, how we can save them budget dollars so that they have some extra cushion in their budgets to help pay for other pet projects that may not have otherwise been funded.

Sales plans are a critical work product for sales pros.  Sales plans keep track of all deals in progress and potential deals.  The sales plans help sales pros keep their eyes on the ball and keep them on top of the deals.  You guessed it, my staff have the same thing.  They maintain "RFx Spend Plans," which document all of the projects where they might need to be engaged to conduct a procurement.  We discuss these spend plans at least once a month to ensure that we're engaged and work is proceeding.  As we discover new deals, they're added to the spend plan.

Relationships, relationships, relationships are the mantra of sales pros.  Procurement pros should have the same mantra.  Sales pros routinely have lunch, etc. with customers to develop and sustain the relationship.  Procurement pros should have the same resources to develop those relationships.  At this point in this article, you won't be surprised to find out that my staff do the same thing.  In my staff's performance plans, they have a requirement to meet with at least one major customer per quarter over lunch (my budget pays for it) to help manage the relationship and build trust / credibility.  My staff are strongly encouraged to personally know their customers, and if they become true friends, then that's healthy.

Sales pros of larger companies usually have an annual customer appreciation event (cloaked as a user conference so as to not appear as too much of a boondoggle) where the biggest customers get an all-expenses-paid trip.  Well, I certainly can't afford to do that, but my staff do something similar.  Every year, we have a customer appreciation event where our customers receive personalized, hand-written notes thanking them for their business over the past year and inviting them to our event.  At the door to the event, the guests are personally greated by my staff and given a raffle ticket with a small party favor (which includes a pen with our department's logo.)  At the event, we have finger food and non-alcoholic beverages (we go to Costco)--and my staff mingle with their customers.  I do a short presentation of our accomplishments over the year and then we present those customers who worked with us on larger deals (where we saved big $$$) plexiglas awards.  Finally, at the end, we raffle off prizes to our customers (some really good stuff that we get from our vendors, like laptops and digital cameras).  Our customers LOVE this event and the event drives them to want to do business with our department (because it's an invitation-only event--if you're not a customer with an invite, you're not getting in).

Sales pros wouldn't be very well equiped if they didn't go through extensive training.  Some companies put their staff through months of training before the staff are permitted to hit the streets.  That's one area where I think I've fallen down when it comes to my staff.  Just like sales pros understand what procurement pros do, the opposite should be true.  For next year's budget, I'm planning to find a good basic sales training course for my staff and have them go through the training.  The more my staff can get into the heads of sales pros, the better.

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Caucus, ISM, and NCMA--Resources a Procurement Pro Can't Live Without in Tough Economic Times

We procurement pros provide value to our employers via our knowledge.  Unfortunately, in a tough economy, training and conferences are two of the first areas that companies look to cut.  For us in the procurement world, that’s a particularly harsh blow to our ongoing ability to maximize value and minimize risk for our employers.  While you may feel compelled to “chip in” to your company’s mission to reduce costs, don’t step over dollars to pick up pennies.  In other words, you’ll save more for your company by going to training and conferences than if you didn’t!  No matter what training or conference I go to, I always pick up one “golden nugget” that inevitably helps me in my negotiations or contract management.  The results is that the cost of the training or conference is de minimis compared to, for example, a significant cost savings resulting from a golden nugget.  The good news is that there are plenty of great resources out there (at very reasonable cost) to provide you with those golden nuggets and that provide you networking opportunities with your fellow procurement pros.  Here are three resources that, as a procurement pro, are an absolute must.  Each have training, conferences, certification programs, and other great and valuable information.

 

ICN / CAUCUS.  If you’re an IT procurement pro, and you’ve never heard of ICN or Caucus—or you’re not a member of Caucus—you’re negotiating using stone-age techniques.  For a low annual membership fee, you can get access to a tremendous amount of resources, a listserv, and fellow professionals.  Caucus also has great certification programs.  Need some temp negotiation support?  ICN can help with their consulting support!  Need some IT-specific contract templates or RFx materials?  ICN has you covered there as well.  New member one-year cost is $495.

 

ISM.  The Institute for Supply Management is the “grand daddy” trade association for procurement pros.  Get access to ISM and you’ve gotten access to a broad range of procurement resources in a broad range of commodity areas.  ISM covers the supply chain from beginning to end.  As a member, you’ll get their very informative Inside Supply Management monthly magazine.  Get the Certified Professional in Supply Management (CPSM) from ISM and you’ll make yourself that much more valuable.  ISM also has local chapters which have great training sessions and speakers.  Get involved in your profession by being an active member in your local ISM chapter.  New member one-year cost is $190; the additional cost to join a local chapter varies (but is worth every penny).

 

NCMA.  The National Contract Management Association is oriented toward public acquisition and, obviously, contract management.  NCMA is a must for public procurement pros and contract managers.  Even if you’re not in public procurement, NCMA has the critical niche of contract management covered—something that all procurement pros should be skilled in.  You've negotiated a great deal, now what?  That's where NCMA really fits in well.  NCMA also has a superb monthly magazine, ContractManagement, and robust certification programs for both public and commercial procurement pros.  New member one-year cost is $130.

 

You can be a member of all three of these great resources, and have access to more resources than you could ever use, for less than a thousand dollars per year!  Make sure you include these membership fees in your procurement department’s budget, and be adamant that the budget for these resources aren’t cut.  Oh, and don’t forget to get a copy of my Contract Negotiation Handbook--another valuable resource that just keeps on giving!

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Using Vendors for Budget Planning: Dangerous or Practical?

Let’s say it’s budget planning time for your customer.  Your customer wants to include in her budget a funding request for the following year which involves hardware, software, implementation, services, consulting, training, and first-year maintenance*.  She comes to you for advice…  What to do?  If you’re lucky, you might be able to provide the estimate yourself just based on your past experience and dealings.  Or you could look at a price-benchmarking or resource service like Gartner or Forrester (assuming you have access, which you should).  You could write an RFI, assuming you had the time and your customer had the appetite.  Your customer likely just wants to get the budget number without a lot of effort, so RFIs are usually unpopular.  That leaves another option, which typically makes the hair on a procurement pro's neck stand up: contacting a vendor directly for a budget planning estimate.

 

Why do procurement pros get antsy with this option?  Well, for one, it could tip your hand to the vendor—the vendor now knows that you’re going to have a procurement next year.  Another problem is that the vendor is in control of the “budget planning” number that your customer is going to get.  Potentially worse, it gives the vendor an opportunity to “talk” with your customer to “understand” the requirements (which basically means doing an end run around procurement).  These are all legitimate fears for a procurement pro.

 

One solution I’ve seen is draconian.  That’s where the vendor that provides the budget planning number is cut out of the future RFP or procurement.  Not only do I think that’s not fair (if you tell the vendor in advance) and is unethical (if you don’t tell the vendor in advance), it could be that particular vendor had the best solution, the best value, and the best price.  You’d be missing out…

 

So how to use a vendor for budget planning and not give up the farm?  Just like anything else in procurement, involve your customer!  In this case, I would explain to my customer what the downsides are, particularly that the vendor is going to try and schmooze her (and use every other vendor ploy, like the “Getting to Know You” ploy that I describe in my negotiation handbook).  I would ask my customer to include me on any calls or meetings with the vendor and I would caution her to refrain from giving the vendor too much information, like project criticality, payback periods, deadlines, project org charts, and the like.  The vendor doesn’t really need that sort of information to provide a budget planning estimate.  I would also have a discussion with the vendor so that the sales rep understands that if he does something untoward, like cutting me as the procurement pro out of the back-and-forth, that it could jeopardize the vendor from winning the deal.

 

Don’t be worried that the vendor knows what your budget number is.  Just because the vendor gave you a budget planning estimate doesn’t mean that’s what was actually budgeted.  Budget plans get cut all of the time, and vendors understand that.  If you do decide to begin negotiations with the vendor that provided the budget planning estimate, the vendor won't be surprised (even though the sales rep may act that way) that your negotiations begin at a price-point less than the budget planning estimate.  At the same time, remember that the vendor’s numbers are likely padded (which is OK given the nature of your likely vague request), so that means some money should almost automatically come off the top (assuming your customer didn’t make a bunch of add-ons to the deal).  I would also ask the vendor for a number of different pricing options.  This tactic helps to mask exactly what will be budgeted and subsequently procured.


When it comes to timing, which a vendor can very effectively use against you (see the “Wait!” and “Hurry Up!” vendor timing ploys in my book), you should advise the vendor that the procurement may not even be made in the subsequent budget year.  The project could be cut or postponed to another budget year.

 

Just in case you do decide to go with that vendor, ensure that the pricing the sales rep gave you is set for a reasonable period of time to allow you to do the procurement without any price “surprises.”  This may be legitimately difficult for the vendor to do given the complexity of the procurement, but at least ask.


One last reason procurement pros don’t like asking vendors for budget planning estimates: the sales rep will pester you from that point on by “just checking with you every now and then.”  Every now and then could end up being weekly.  Just be upfront with the vendor—no reason to be coy—and tell the sales rep that you don’t want to hear from him and that you’ll call him when you need something.  If the sales rep still contacts you after that, don’t feel bad about ignoring the phone calls or e-mails.


To avoid a number of issues that I've raised above, get the budget planning estimate from your vendor-of-choice and then go through an RFP process in the next budget year.  Competition is the best negotiation tool!


 

*By the way, why are you agreeing to pay first-year maintenance!?  That should be a freebie!

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NRECA Member, Dick Rich, Receives ISM's J. Shipman Gold Medal Award!!!


A colleague of mine, and a member of NRECA (my employer)--Mr. Richard D. Rich of Seminole Electric Cooperative in Florida--has received the highest honor available in our profession from ISM.  This award has been sought by high level Fortune 500 supply professionals throughout the country over the years. It is quite a coup that a rural electric cooperative employee has obtained it, but not a surprise.  Dick's credentials are incredible and varied.

 

Highest Honor in Supply Management Presented to Seminole Electric Cooperative Exec

 

Institute for Supply Management™(ISM) honors Richard D. Rich, C.P.M., with J. Shipman Gold Medal Award.

 

(Tempe, Ariz.) May 5, 2009 — Richard D. Rich, C.P.M., today accepted his profession's highest honor at the Institute for Supply Management™'s (ISM) 94th Annual International Supply Management Conference and Educational Exhibit. Rich accepted the J. Shipman Gold Medal Award in Charlotte, North Carolina, in recognition of modest, unselfish, sincere and persistent efforts for the advancement of supply management.

 

Rich has spent the majority of his 35-year career working in the government and public sectors. He is director of enterprise risk management for Seminole Electric Cooperative, Inc. in Tampa, Florida. Rich arrived at Seminole in 1982, and spent the next 26 years in purchasing, inventory, materials management and supply management. In 2008, Seminole Electric's CEO recruited him to implement an enterprise risk management program for the entire organization. "I'm proud that my organization made the bold and innovative move of entrusting a supply chain professional to manage risk on an enterprise level," Rich says.

 

Seminole Electric Cooperative CEO Tim Woodbury says he never even considered looking outside the organization. "Because of the skill set gained in supply management and his demonstrated leadership abilities, Richard was the ideal choice for establishing this new enterprise risk management function," Woodbury says. "Richard was able to hit the ground running — supply management not only equipped him well for the task of establishing protocols and methodologies for assessing risk, but it also gave him the tools necessary to effectively work across departmental lines with personnel at all levels within the company." Adds Woodbury, "My ability to redeploy existing manpower in this instance was only made possible by Richard having groomed his capable successor. It was a win-win for the company and a win for all the employees involved."

 

Like Shipman winners before him, Rich has played in integral part in the leveling up of the profession and his chosen association. For five years, between 1997 and 2001, he played a key role in changing the 85-year-old National Association of Purchasing Management™ (NAPM) governance process to the current Institute for Supply Management™ (ISM) governance and operating process. During his president-elect year from 1997 to 1998, Rich chaired the NAPM Strategic Planning Committee which prepared, drafted and coordinated the first-ever NAPM Five-Year Strategic Plan. While serving as NAPM president during 1998 to 1999, Rich spearheaded the leadership that ultimately led to the adoption by NAPM of a number of key initiatives contained in the Strategic Plan, including changing the name of the association to Institute for Supply Management™, a name that more appropriately reflects the growing importance of the field of supply management within public and private organizations.

 

Rich spent his early career with the State of Wyoming. One of his first positions involved managing contracts and purchases of food and pharmaceuticals for state institutions. He was later promoted state program manager for purchasing and assistant administrator for the Division of Purchasing and Property Control. In 1979, the governor of Wyoming appointed Rich chief of fiscal operations for Wyoming Game and Fish. In July 1980, Rich moved east and was appointed purchasing supervisor with the City of Pittsburgh, where he supervised a citywide spend of about $250 million. In March 1981, then-New York City Mayor Edward Koch appointed Rich to the post of assistant commissioner of procurement for the five boroughs of New York City.

 

Rich earned a bachelor's degree in political science from the University of Wyoming (UW) in Laramie. He is former president of Sigma Alpha Epsilon (SAE) fraternity and also co-founded A-Enterprises, a local social fraternity for men and women.

 

The J. Shipman Gold Medal Award is the highest award within the power of ISM to confer. ISM joins the members of the 2008-2009 J. Shipman Gold Medal Award Selection Committee — Thomas H. Slaight; Aaron D. Dent; Timothy R. Fiore, C.P.M.; R. David Nelson, C.P.M., A.P.P.; and Norbert J. Ore, CPSM, C.P.M. — in congratulating Richard D. Rich, C.P.M., on this prestigious award. The J. Shipman Gold Medal Award was created by the Purchasing Management Association of New York in 1931 to honor Johnson Shipman, a pioneer in the profession.

 

As the largest supply management institute in the world, the mission of Institute for Supply Management™ (ISM) is to lead supply management. By executing and extending its mission through education, research, standards of excellence, influence building and information dissemination — including the renowned monthly ISM Report On Business® — ISM continues to extend the global impact of supply management. ISM is proud to recognize professional excellence in supply management with awards such as the ISM R. Gene Richter Awards for Leadership and Innovation in Supply Management and the J. Shipman Gold Medal Award. ISM's membership base includes more than 40,000 supply management professionals in 75 countries. Supply management professionals are responsible for trillions of dollars in the purchases of products and services annually. ISM is a member of the International Federation of Purchasing and Supply Management (IFPSM).

 

Media Contact:
ISM Public Relations
800/888-6276
Jean McHale, extension 3143
jmchale@ism.ws

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Over-lawyer: A Definition

Main Entry: oŸver-lawŸyer

 

Function: verb

 

Inflected Form(s): oŸver-lawŸyered; oŸver-lawŸyerŸing

 

Etymology: Middle English, from Old English lagu, of Scandinavian origin; akin to Old Norse lǫg law; akin to Old English licgan to lie

 

Date: before 12th century

 

: to unnecessarily complicate, obfuscate, and / or “kill” business deals or contract matters with arcane legal jargon, scenarios that will never occur, and a near-psychotic adversity to risk.

 

Usage:

 

1.  Our @#$&* attorney over-lawyered this purchase agreement by including EVERYTHING in this contract, including a gender clause!

 

2.  I think our counsel was over-lawyering this contract when she changed all of the “wills” to “shalls.”

 

3.  When a lawyer says “I know that would never happen, but…,” he or she is said to be “over-lawyering.”

 

4.  We knew our lawyer wasn’t going to over-lawyer our deal when he said, “That’s a business risk, and up to the business to decide.”


5.  Please don't over-lawyer our deal, we need to make this deal happen.

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Word to Your Ven-duh! Place Nice Nice Baby!

To the tune of "Ice Ice Baby"--my apologies to Vanilla Ice...

Yo, ven-duhs, let’s kick it!

 

Nice nice baby, play nice nice baby

 

All right stop, collaborate, and listen

Guth is back with a new contract edition

Client grabs a hold of me tightly

Ink flows from my pen daily and nightly

Will it ever stop? Yo -- I don’t know

Turn off the lights and I’ll glow

To the extreme I rock a contract like a vandal

Turn the next page and wax a vendor like a candle

 

Dance, bum rush the vendor that booms

I’m killing sales reps like a poisonous mushroom

Deadly, when I play a contract melody

Anything less is no indemnification or a felony

Love it or leave it, you better gain way

Vendors beware, this kid don’t play

If there was a problem, yo, I’ll solve it

Check out my book while my publicist evolves it

 

Nice nice baby, play nice nice baby

Nice nice baby, play nice nice baby

 

Now that the deal is jumpin'

With Guth kicked in, the prices are dumpin'

Quick to the point, to the point no faking

Cooking vendors like a pound of bacon

Burning them if they’re not quick and nimble

I go crazy when I see them tremble

My work for hire clause has a souped up tempo

I’m on a roll and its time to go solo

Rollin' with my Mont Blanc 5.0

With the cap off so the ink can flow

The vendors on standby, waving just to say hi

Did you stop?  No -- I don’t buy

Kept on pursuing to the next stop

I busted a vendor ploy and now I’m heading to the next talk

That talk was dead

 

Nice nice baby, play nice nice baby

Nice nice baby, play nice nice baby

 

Take heed, ‘cause I’m a contractual poet

Guth is on the scene just in case you didn’t know it

My contracts, that created all the "chi ching" sound

Enough to shake and kick vendor ploys to the ground

‘Cause my contract's like a chemical spill

Terms and conditions that you shall and will

Drafted and formed, this is a hell of a concept

I make it hype and you want to get with this

Guth plays on the fade, slice like a ninja

Cut like a razor so fast, vendors say, damn

If my contracts were a drug, I’d sell ‘em by the gram

Use my secret tactics when it’s time to get loose

Magnetized by the UCC while I kick my juice

If there was a problem, yo – I’ll solve it!

Check out my book while publicist evolves it

 

Nice nice baby, play nice nice baby

Nice nice baby, play nice nice baby

 

Yo man – Let’s get out of here! Word to your ven-duh!


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