Avatar comes to procurement?

5 July 2010
One topic grabbed my attention recently while I was engaged in a discussion over on the Purchasing Practice LinkedIn group covering the future of procurement: the issue of holding supplier meetings in virtual game/life simulation Second Life. A quick Google search highlighted impressive organisations such as Intel, IBM and Schneider Electric using Second Life for workplace activities such as meetings and events. In fact, Second Life has a whole section devoted to “Workplace Solutions”, such as meetings and presentations. So perhaps the concept of holding supplier meetings or even negotiation may not be so absurd, and that this emerging technology trend should be on the radar for all of us aware of the need to sense and respond to new innovations with the potential to shape both our markets and our profession. In the legal sphere lawyers are using “Etherpad” to collaborate in Second Life to edit documents in real time. Imagine the time this could shave off getting contracts finalised. In the technical world companies are using Second Life to collaborate using 3D data visualisation and the education community is using Second Life to teach. So apart from sourcing conference spaces, meetings and events, could there be other innovative uses of virtual technology such as training and negotiation or training in negotiation? When you broaden the discussion from meetings to overall collaboration, the possibilities of virtual worlds in the procurement domain expand significantly. Procurement is ideally placed to coordinate collaboration between their organisation and its customers and suppliers to drive innovation. While the need for physical meetings and web tools such as Go To Meeting will not be replaced, perhaps the use of virtual worlds has its place alongside them. I argue that procurement should evaluate and secure this ground rather than give it up to another function – this is certain to get the attention of the CEO, just as online auctions did. Benefits are quoted in hard cash savings: IBM quotes that for an initial investment of roughly $80,000 (£53,000) they saved $320,000 (£211,000) compared with the potential expense if the event had been held in the physical world. The company also claims to have capitalised on all of the "softer" benefits of socialising and networking. It is certainly environmentally friendly and an effective way to reduce a firm’s carbon footprint, and yet the greatest drawback must surely be “impersonalising the business process”, an important consideration for us all. With so many companies and disciplines already seemingly under way, it’s time to start thinking about procurement in a virtual world and what its role should be. What will your avatar look like?
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