Solomon Bruce Consulting Blog

Sunday, March 31, 2013

The Carrot, Egg and Coffee Bean

   A carrot, egg and coffee bean were each placed in boiling hot water.  The carrot went from being firm and hard to soft and limp.
    The egg became hard.
    The coffee bean flavored the water and transformed the water from water to coffee.

    Life is the same way.  If we are hard and firm and face some type of adversity, like the carrot, we can become soft and limp.
    Conversely, if we are hard on the outside, but soft on the inside-- adversity can make us become just hard and firm.
    The coffee bean took the adversity and "made the best of it" by flavoring the water and improving the water's taste.

     In business, we often times are faced with adversity.  Business adversity is just like the hot water.  It is how we react and deal with the adversity that makes the difference!  The past 4 years have been tough, however, business conditions appear to be improving.  Now is the time to think about how you have handled adversity during these past four years.

     Ideally, you have done the best you can and not been struck by all of the adversity that the world has encountered.

      Think about how you have handled adversity-- then think about the carrot, egg and coffee bean.  Each was transformed by adversity, however, the coffee bean was best able to handle the challenges it faced.

       If your business is facing adversity, let our consultants help you address that adversity.  We can identify what needs to be done to get you back on the path of forward progress.

Friday, March 22, 2013

Strategic Sourcing-- The Way to Increase Profits

     Strategic Sourcing is a purchasing/procurement method that saves a firm or company money.  How does it work?  It analyzes DATA and determines where the best buys are and why they are better buys than other stores.

      Let's take an example-- If you buy dishwasher soap at store X for $3.00/box and a similar, but different soap at store Y for $4.00 box, your first thought is that it costs 25% more, $1, to buy at store Y.  Well, prima facie, that is true.  However, if you are able to use less of the soap at store Y for each load, the soap lasts longer and you are able to accomplish more loads of washed dishes.

OK-- initial cost is more, usage costs are less, end result is greater efficiency (more dishes washed) at less cost.

      Take a look at all of the products that you buy-- either in your business or at home.  The logic applies equally.  There is nothing complicated or complex about strategic sourcing--- you can analyze the soap usage by seeing how many loads of dishes you can clean with one box.  Now, in a larger industrial environment, we do the same thing, however, use computers to analyze product usage over time.

      What this example has shown us is that the TOTAL OWNERSHIP COST is less, however, buying the initial product, the dish soap, costs more.  Think about this at home.  You will find that there is extra profit to be obtained just by doing more data analysis.