All posts by paysonj

Plato’s Republic – Books I-V

Plato sets forth an argument, using his teacher Socrates as the primary role in the dialogs, to define what justice truly is, and starts a quest to find it within a city first and afterward within a person.   He creates his argument by first debating with several protagonists who define the definition of justice as being“…to benefit one’s friends and harm one’s enemies is justice.”[1]    This argument is narrowed down as “just to obey the orders of rulers,”[2] however it creates a paradox in the argument that rulers can be unjust in order to create a just city.  Plato, speaking through his former teacher, tries to rescue justice out of the conclusions of his debaters that it better to be truly corrupt but perceived by everyone else as just.

plato2_1559507eThe thesis put out by Socrates is that “justice is virtue and wisdom and that injustice is vice and ignorance.”[3]  He proceeds to prove this by first exploring what makes a city just and shows how “justice brings friendship and a sense of common purpose.”[4]   Justice within the city is first proven through painting a path to justice through the  virtues that the cities possess.   The virtues of courage, temperance, wisdom are found in the city and educate the city, especially the guardian class on what “…good character” is and “has developed in accordance with an “intelligent plan.”[5]   The journey through an ideal city comes to the conclusion and the definition of justice: “that justice is doing one’ own work and not meddling with what isn’t one’s own.”[6]   Justice grows from the other three virtues but also “rivals wisdom, moderation, and courage” because of “its contribution to the virtue of the city.”[7]    The dialog then turns to an individual and the conclusion is justice in a city is external, but justice within an individual is internal.   Justice for an individual “…isn’t concerned with someone’s doing his own externally, but with what is inside him, with what is truly himself and his own.”[8]  For Socrates, justice in an individual is really someone who “harmonizes the three parts of himself.”[9]

Analysis – Positive:

justicePlato’s argument of justice for a city, through living out the virtues and one’s calling makes sense in a lot of ways, although the practical outcomes proposed are very controlling and border on totalitarian in nature.   Plato offers a picture of a city in harmony living with each other, while protecting each other, and serving each other in various roles and areas that bring goodness and human flourishing to the city.   However, this view of justice is in stark contrast to modern forms of justice as I will highlight next.

Analysis – Negative

Plato’s conclusion of a just city is reserved for the elite and cream of the crop.  The guardians, and briefly discussed, the philosopher kings, are the ones that are treated with the highest respect with the auxiliary and money-making functions being the lowest.  The artist class exists to serve the education of the guardians.  All need to stay within their class, or calling, and should not move out of these areas since meddling and exchange between these three classes “…is the greatest harm that can happen to the city and would be called the worst thing someone could do.”[10]   Plato’s view of justice excludes the unmentioned classes in the text of slaves, some groups of women, and others that do not fit the 3-4 profiles offered by Plato.

Written by Payson Johnston

[1] Plato, G. M. A Grube, and C. D. C Reeve, Republic (Indianapolis: Hackett Pub. Co., 1992), 9, http://public.eblib.com/choice/publicfullrecord.aspx?p=735561.

[2] Ibid., 16.

[3] Ibid., 27.

[4] Ibid., 28.

[5] Ibid., 77.

[6] Ibid., 108.

[7] Ibid., 109.

[8] Plato, G. M. A Grube, and C. D. C Reeve, Republic (Indianapolis: Hackett Pub. Co., 1992), 119, http://public.eblib.com/choice/publicfullrecord.aspx?p=735561.

[9] Ibid.

[10] Plato, Grube, and Reeve, Republic, 109.

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THE VALUE CHAIN MATTERS TO YOUR SMALL or MEDIUM BUSINESS

Over the last year, I have had the opportunity to discuss value chains, products, and challenges with many small & medium businesses.   Coupled with my years working in high-tech supply chains and my discussions with MBA students on the need for companies to focus on the value chain these experiences have afforded me the opportunity to think about the key takeaways on managing value chains for small & medium businesses.

Supply-Chain-Management-3Here is a brief guide to the 12 essentials of managing the Value Chain:

1) Understand your customer (aka value chain management): A lot of times value chain professionals will forget about what the customer’s needs are and leave it up to the marketing and sales departments to take care of it. The key part of value chain management is to understand the end customer within the marketing channel. How will the customer want to receive the goods or services? Will special packaging be needed or will the item be displayed on store shelves?

The customer is the key ingredient on ensuring an effective supply chain.  This is why “Value Chain Management” is slowly replacing the term supply chain management.   If the customer is forgotten in the supply chain you might as well get rid of it.

2) The supply chain matters a lot: Often the supply chain is left to the last possible minute during product designs, marketing programs, and customer meetings. Don’t forget that the product still needs to be designed, built, and shipped or served to the customer if the company is going to make money. If your business is, a service company ensuring employees and inventory to get to the right place at the right time are key.   The supply chain matters!    Many tools can help in this area.   A great project management tool for small and medium business is Zoho Projects that can be integrated into Zoho’s CRM (Customer Relationship Management).

3) Understand your product, service, or technology: One often hears in value chain management that it is really about shipping or selling widgets, and one widget is no different from another. This urban myth is far from the truth. Some items may need to be refrigerated, other products may require special care and handling while some services may be digital. Understanding your product, service, or technology is key to creating a successful value chain.

4) Get out of the office: Don’t just stay at your desk to manage the value chain. Get out and see it. Ask questions. Learn from others who have managed value chains before and visited the marketing channel, factory, and suppliers. If possible, follow the product from raw material, through logistics, to the final customer. You will learn a ton.

Lectur25) You need to negotiate: Negotiating is key to value chain management. Cost, quality targets, SLAs, and KPIs all need negotiations around the terms. If you want to be successful in value chain management, you need to become a good negotiator. Some practitioners are naturally gifted at negotiations, but a larger number of value chain professionals need training and constant practice.  Leverage is not always about the amount of spend you have with the supplier.   It is also measured in predictability, brand value, and the ability for the vendor to diversify in other markets.

6) It is not just about cost savings: Although costs are necessary, it is not just about delivering great cost savings. Other factors include the quality of the product, the value of the business that the supplier, buyer, and end customer derive from the service, product, or technology, and ensuring the right amount of inventory is in the right place at the right time.

7) It is about the People: There is a lot of buzz today about the automation of the value chain. In the end, however, the value chain still comes down to relationships and people. Tools and systems will get better over time but even with the complete automation of the supply chain, people are still needed to make things happen, improve the system, and fix things when they break.

people_resized

8) Value the relationships for the long-term: Supplier relationships should be treated as long-term relationships. Fair practices, fair dealings, and fair awards will ensure the reputation of your company remains intact. Treat both the buyer and seller with respect and honesty.   Don’t overcharge, treat both parties like family.

9) Use the data to make decisions, not your emotions: In the past I have seen many decisions on value chain optimization and strategy made strictly on emotions. This is a large mistake. Always look at the fully burdened and landed costs. Never just assume something is a “great” deal or opportunity because everyone loves the new supplier. Look at the data. Look at the facts. Remove emotions out of the decision-making process.

10) Limit the risk: The “Achilles’ Heel” of the value chain is that it can quickly be disrupted through natural disasters, acts of war, environmental issues, and industry-wide shortages. Prepare for the worst but proactively limit your risk through second sourcing (which is key), auditing environmental and social compliances, and creating inventory plans that ensure continuity. Also, watch out for the second and third tiers of your supply chain, which can quickly bring a value chain to a screeching halt.

11) Keep an eye out for disruptive trends: Value chain management cannot be done in isolation. Industries shift, trends change, media hype comes and goes, and customers go elsewhere. Watch the trends and modify or change or even disrupt your value chains strategy in new directions, so you do not get left behind.

energy-sustainability2105612) Embedded sustainability is the key: There is much talk nowadays on sustainability especially from the PR departments of companies.   To make real progress in sustainability (defined as balancing the needs of Plant, People, and Profit) a company both big or small must embed it into its everyday operations and DNA.   Otherwise, it becomes only a marketing promotion and is not part of the core of the company.  Every worker must embrace sustainability, and it needs to be within every function and operation of your company (from audits to supplier award selection, to product design, to how external stakeholders are treated fairly). The great thing about being a small or medium business is that you can embedded sustainable practice from the start. For helpful information on this see the B Lab guidelines.

Over the last year the below additional key value chain points have come up from colleagues and blog readers:

  • Importance of understanding different cultures in international relationships
  • Understand the entire business process end to end and how the value chain affects this process
  • Monitor the multiple tiers in your value chain
  • Watch capacity and constraints so you can handle upsides in customer demands without concern
  • A positive attitude is key
  • Hard skills and soft skills such as leadership are important
  • Get involved and be hands on in solving problems as part of the value chain team
  • Ensure your value chain is tied into your communication channel

All, great suggestions and feedback from past readers.

Good luck on managing your value chains! Don’t forget the above 12 essentials and feel free to leave your own in the comments.   Also, please reach out at anytime to discuss your value chain and how I can help with your small or medium business.    My direct email is paysonj@agoraintel.com.

Payson Johnston is the CEO & Co-Founder of Agora Intelligence, Inc., a mobile-first e-commerce company helping sellers, buyers, and the community Come Together to Buy, Sell, Share and Give.

Sign-up today to be a seller on AiMarket.io. 

12 Essentials of Supply Chain Management

Over the years, I have had the opportunity to manage diverse suppliers and supply chain teams all over the world with both large and small companies. In addition, I have had the privilege of teaching supply chain management to both students and practitioners. Here is a brief guide on the 12 essentials of managing a supply chain (aka Value Chain):

Supply-Chain-Management-31) The supply chain matters: Often the supply chain is left to the last possible minute during product designs, marketing programs, and customer meetings. Don’t forget that the product still needs to be designed, built, and shipped or served to the customer if the company is going to make money. The supply chain matters!

2) Understand your customer (aka value chain management): A lot of times supply chain professionals will forget about what the customer’s needs are and leave it up to the marketing and sales departments to take care of it. A key part of supply chain management is to understand the end customer with the marketing channel. How will the customer want to receive the goods or services? Will special packaging be needed or will the item be displayed on store shelves? The customer is the key focus on ensuring an effective supply chain.  This is why “Value Chain Management” is slowly replacing the term supply chain management.   If the customer is forgotten in the supply chain you might as well get rid of it.

3) Understand your product, service, or technology: One often hears in supply chain management that it is really about shipping widgets and one widget is no different than another. This urban myth is far from the truth. Some items may need to be refrigerated, other products may need special care and handling, while some services may be digital. Understanding your product, service, or technology is key to creating a successful supply chain.

4) Get out of the office: Don’t just stay at your desk to manage the supply chain. Get out and see it. Ask questions. Learn from others who have managed supply chains before and visit the factories and suppliers. If possible, follow the product from raw material, through logistics, to the final customer. You will learn a ton.

5) You need to negotiate: Negotiating is key to supply chain management. Cost, quality targets, SLAs, and KPIs all need negotiations around the terms. If you want to be successful in supply chain management you need to become a good negotiator. Some practitioners are naturally gifted at negotiations, but a larger number of supply chain professionals need training and constant practice.

Lectur26) It is not just about cost savings: Although costs are important, it is not just about delivering great cost savings. Other factors include the quality of the product, the value of the business that the supplier, buyer, and end customer derive from the service, product, or technology, and ensuring the right amount of inventory is in the right place at the right time.

7) It is about the People: There is a lot of buzz today about the automation of the supply chain. In the end however the supply chain still comes down to relationships and people. Tools and systems will get better over time but even with the complete automation of the supply chain, people are still needed to make things happen, improve the system, and fix things when they break.

people_resized

8) Value the relationships for the long-term: Supplier relationships should be treated as long-term relationships. Fair practices, fair dealings, and fair awards will ensure the reputation of your company remains intact. Treat both the buyer and seller with respect and honesty.

9) Use the data to make decisions, not your emotions: In the past I have seen a lot of decisions on supply chain optimization and strategy made strictly on emotions. This is a large mistake. Always look at the fully burdened and landed costs. Never just assume something is a “great” deal or opportunity because everyone loves the new supplier. Look at the data. Look at the facts. Remove emotions out of the decision-making process.

10) Limit the risk: The “Aquiles’ heal” of the supply chain is that it can quickly be disrupted through natural disasters, acts of war, environmental issues, and industry-wide shortages. Prepare for the worst but proactively limit your risk through second sourcing, auditing environmental and social compliances, and creating inventory plans that ensure continuity. Also, watch out for the second and third tiers of your supply chain, which can quickly bring a supply chain to a screeching halt.

11) Keep an eye out for disruptive trends: Supply chain management cannot be done in isolation. Industries shift, trends change, media hype comes and goes, and customers go elsewhere. Watch the trends and modify or change or even disrupt your supply chains strategy in new directions, so you don’t get left behind.

energy-sustainability2105612) Embedded sustainability is the key: There is a lot of talk nowadays on sustainability especially from the PR departments of companies.   In order to make real progress in sustainability (defined as balancing the needs of Plant, People, and Profit) a company both big or small must embed it into its everyday operations and DNA.   Otherwise it becomes only a marketing promotion and is not part of the core of the company.  Every worker must embrace sustainability and it needs to be within every function and operation of your company (from audits, to supplier award selection, to product design, to how external stakeholders are treated fairly).

Good luck on managing your supply chains! Don’t forget the above 12 essentials and feel free to leave your own in the comments.

Payson Johnston is the CEO & Co-Founder of Agora Intelligence, Inc., a mobile-first ecommerce company focusing on sellers, buyers, and the community Coming Together to Buy, Sell, Share, and Give.   He is also currently an Adjunct Professor in the School of Management at the University of San Francisco and start his Ph.D. in Business Ethics at the Graduate Theological Union in September of 2015.

Note: This article was originally adapted from a long form post on LinkedIn by the same author.  It was refined after using it as a framework for teaching supply chain management (aka value chain management) to MBA students in Spring 2015.

Business & Innovation – Training in Business Schools Needed

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An MBA candidate at USF wrote a very thoughtful and insightful post on Linkedin. My comments below are in response to this post. I believe Lucas has correctly identified a problem with a lot of MBA programs. The goal is to change these trends.

I do agree that many MBAs that I have worked with in the past forget about the importance of innovation, however, a lot of business people, engineers, and even marketing professionals forget that creativity in business is important as well. Maybe it is because of incentives offered by companies or maybe it is based on training.

True innovation views all aspects of the business as areas that can be disrupted over time. Most people have some form of creativity within them but at one point or another it has been suppressed by company norms, the classroom, or other areas. An individual needs to push past this and drive themselves to think outside-the-box and ask key questions such as:

  • Why is the process working this way? This question is especially important to ask when you are first on a job.
  • Why is the product important to the customer? How can it be better? 
  • What industry needs to be disrupted and what are the ways it can be disrupted?
  • Are there ways sustainability can disrupt the current industry and create entirely new business models (peer to peer, paper to digital, or even computer to mobile)?
  • What business am I really in and what can I do to change things in my business and the industry? 

The cool thing is that MBAs are positioned to ask the right questions because they are looking at all aspects of the business: market trends, marketing, finance, operations, etc. They are also geared towards execution and making sure that great ideas happen. Combining this ability to execute with creativity is a powerful combination and something that startups need.

Once MBAs start to answer these questions, the lack of creativity in MBAs will flee. I believe the ideas MBAs bring up in the classroom are highly innovative (even beyond what I have heard from so called creative circles)…and hope to see the current crop of creative MBAs break the trend or the norm that was correctly identified by Lucas in the above post.

Watch out world…a new era of creative MBAs are about to disrupt the industry.

Payson  is currently an Adjunct Professor in the School of Management at the University of San Francisco. He is also the CEO & Co-Founder of Ai (Agora Intelligence, Inc.) a mobile first company focusing on the need to Promote Goodness for Sellers, Buyers, and the Community through transforming the marketplace.

Source: Article originally published on Linkedin on Feb 17 at https://www.linkedin.com/pulse/mbas-who-innovate-coming-change-payson-johnston