Board meetings should always have CPOs...


Imaging looking at your credit card statement, and not having a clue about the underlying reasons, logic or drivers under every spending line...!


Well, that's what most boards actually do when they do not have their CPO as permanent member at their board meetings...


Don't get me wrong! Financial statements are great tools to see how the company is doing. But they are just a bunch of reports with an endless list of data tables and pretty historical graphs on power point presentations. CPOs can not only tell where the money is going, but they can also tell you why, where and how, what's coming and what could be done about it!


CPOs position is unique: they have to collaborate with everyone! And they have to understand the business in details at the operational level, because supply chain touches EVERYTHING in a company: field operations, manufacturing, R&D, sustaining engineering, sales, product line, legal, HR and finance. CPOs have to understand every goods movement in and outside the company around the world, what are the supply market trends that could impact the company bottom-line and suggest hedging strategies to minimize negative cost impact. They know how to sustain supply quality, suppliers performance and timely delivery. CPOs know what could be done to reduce spending on Opex and Capex, not just show a board that a line on a spreadsheet is too high and "needs to be cut by 20%".... "Yeah, right! Duh... But how... and is 20% even realistic..."!


As a result, CPO are in a unique position to deliver significant cost improvements directly to the bottom-line, or COGS line, or even SG&A line of that income statement, or improve that inventory line, or A/P line on that balance sheet. CPOs touch the company everywhere and are a strategic asset to every board meeting.


Some companies get it, and eventually realize that their CPOs are even CEO material, like Apple or Sony. Most companies though, have not reached that level of evolution depending on industries and sectors. The ones who do, have developed a unique competitive advantage, which is very difficult to copy by their competitors, because it is not explained in details in any financial statements or reports. It guarantees these companies years of such sustainable competitive advantage...


Having a board meeting without a CPO, is like flying a plane without understanding half of the avionic instruments... Scary food for thoughts...

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