Impact of Education At the Macro and Micro Level

June 23rd, 2008 at 05:57am Mireia Brancos - Iasta

A recent article in Supply & Demand Chain Executive, China’s Investment in Education Sees Accelerating Overall Economic Development, described the positive impact that education can have in a country’s economy.

According to a report from the Manufacturers Alliance/MAPI, China’s increasing investment in its educational system will accelerate the move toward rapid wage growth, higher levels of consumer demand, slowing population growth, and overall economic development.

In my opinion, there is a lot to learn from this. Even though China’s education initiative is a much larger, macro-undertaking, the key principle of education applies to any company who wants to succeed in the world of eSourcing.

Most obvious and discussed all the time is the need for executive sponsorship. Whether we are talking about the government or a company’s corporate executives, sponsoring the initiative by challenging the status-quo and being involved and supportive. And of course, implied in sponsorship is a focus on investing time and funds. But it is the way these funds are distributed amongst the eSourcing purchase that sometimes puzzles me.

I would think the #1 goal (ok #2 after savings but without #2 you wouldn’t achieve #1 – stay with me) of any eSourcing initiative is adoption. Adoption means individuals in the company understand the need and benefits associated with eSourcing and they are comfortable with using it for their day to day sourcing needs. And guess what the key to adoption is? Sourcing training & support.

Time and time again, I see Sourcing Training and Support be underrated when evaluating and rolling out eSourcing. This is exactly what caught my attention in this article – the huge impact that education can have to the overall success of a country, a company or an initiative such as eSourcing.

AMR Research did a study that concluded that “Most organizations lack operational excellence that allows them to benefit from investments in advanced technologies”. Companies spend lots of funds, time and effort ensuring that the tools they purchase have every bell and whistle available in the marketplace (even though over 50% of the functionality will probably not be used initially or maybe never), but little time and money is placed on purchasing the right sourcing training and support.

Having sold and managed eSourcing programs for over a decade now, I can often predict how big of an impact eSourcing will make in an organization based on the amount of training and support that is purchased vs. needed.

So my recommendation is don’t cut corners when it comes to eSourcing education. Your initiative’s success depends on it. Tremendous ROI can be achieved by ensuring that everyone has been given the “educational” tools to succeed.

In China (and I would presume the rest of the world), higher education translates into higher domestic product and manufacturing rates. In the sourcing world, higher education translates into higher adoption, visibility and process efficiencies = higher savings.

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Entry Filed under: Analysts/Research, General, Global Supply Issues/Risk, Supply Management Best Practices, Technology / SaaS, e-Sourcing Marketplace