Conquent: Without Limits
Conquent: Without Limits
Michael Bissell's Blog

Cave Man Distribution Networks

2010-07-09 09:28:43
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I had an interesting conversation with a "Senior Procurement Systems Executive" from the Ministry of Justice in the UK yesterday. I know, none of that has the ring of cliff diving in Acapulco or gazing at the stars at the observatory in La Palma, but exploring the similarities and differences of what we do as business people in very different industries and in different countries was instructive.

Personally, I love talking to people who do things that I don't do. I think of it as knitting in the edges of my knowledge -- if I learn a little about government procurement in the UK, I have a better understanding of buying and selling products in general, and buying and selling is the most universal form of communication.

Think of the evolution of commerce and go back to the wandering tribes of nomadic peoples on the plains of some ancient continent. They may not share a language, but Thag can gesture with a couple marmot pelts and point at a pile of nuts by the fire. Gugh pulls a few nuts off the pile, then a few more, until Thag smiles and hands him the pelts in exchange for the nuts.

But just as we don't wander the plains anymore, buying and selling has become a complex series of negotiations with a lot more paperwork and, honestly, just as much if not more grunting.

What did occur to me in our conversation is that the actual negotiation is still pretty much the same -- I hang onto my marmot pelts until I know how many nuts I'm getting in exchange, you dole them out carefully to make sure you're not giving me any more than you have to.

It's all a question of how many people need to be involved and how much stuff needs to be traded to make something happen. Sure, it's gotten really complicated with raw materials and manufacturing that isn't just killing something and skinning it and with distribution networks that aren't just a boy from village running some pelts to the next village.

Just as we don't use stone knives, we also have tools to know how many villages there are, how far that marmot pelt travels, and what kind of price it's getting at the edge of the world. But it's still the same process of making something, negotiating a price, and delivering it.

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