CATTAN Services Group
March 31, 2014 Issue
The Most Powerful Name In Corporate News and Information
Logistics and Supply Chain Boutique Consulting Services
CATTAN Services Group
College Station, TX 77845 USA
Interview conducted by: Lynn Fosse, Senior Editor, CEOCFO Magazine, Published – March 31, 2014
CEOCFO: Mr. Tanel, what is CATTAN Services Group?
Mr. Tanel: Basically, we are a boutique consulting firm providing what we call advisory, counseling and training services. We have a very specialized expertise with very specific dimensions. Those skills are in the logistics and supply chain area, which we feel are mostly in short supply. We focus on about five areas of expertise. One is supply chain management strategy and logistics for engineering. We look at purchasing contract and procurement activities, warehousing and materials handling, freight traffic and distribution operations, and inventory planning and control management.
CEOCFO: What types of companies would be seeking your services and when might they be coming to you?
Mr. Tanel: Number one, the type of companies could range anywhere from government, Fortune 500 or small to medium sized business enterprises. We are not industry specific by any means, so we offer functional expertise. We look at the fact that we can deal with different industries. Many of the problems they have are not industry specific; 80 percent of what they do is similar, and the other 20 percent makes them unique. I think that adds a little bit of value from our perspective because we have depth as well as breadth and the functional expertise they might be seeking.
CEOCFO: At what point in time is someone likely to come to you?
Mr. Tanel: Somebody decides they have a problem or they think they have a problem, and usually it is not beforehand. They usually need help, and that is usually when people reach out to us. I guess I learned that kind of from the first consulting firm that I was with. The person who was my mentor said to me that if the client calls on the phone and says they have a problem; ask yourself, if they knew what the problem was in the first place, why would they be calling us.
CEOCFO: What is the key to understanding what the problem really is and not just what the client thinks it is?
Mr. Tanel: The thing I learned, which you do not do learn as a firing line person, is that you are always looking for a problem solution rather than problem prevention. Usually, what people do not do is properly define the problem. They spend more time on Band-Aids for what they can do to get things resolved. Our first thing, before even sending a proposal to anybody, is to have a work session either on site, or because of distance it could be a Skype call where you will get visuals, or a telephone session. This is just to find out what their needs and objectives are and to ask good questions. If the client does not have the time to do that, then that probably is not a good alignment for us. Right off the bat, we probably will say they are not serious about this and we then ask ourselves if it is worthwhile to proceed with a proposal. I think this is the time, when you as the consultant, really have to sit down and listen to what the client has said to you. Do they understand the nature of their problem or the extent of it? For example, some people will say to us that they have a receiving problem. Is it a receiving problem or does that problem extend beyond receiving, which it usually does? It is going to be more multifunctional, and I think that sometimes people take a myopic view. They do not take a panoramic view.
CEOCFO: What are some of the differences from when you started the company to today?
Mr. Tanel: I would say that when I first started out, most people focused more on the operation and tactical side of things. I find that today most people are looking at both tactical and strategic areas. Since the mid-90s, the field that we focus on, which is the supply chain and the various functions within the logistics, there has been a moving up of executives to a higher level at the C-level. You have Chief Procurement Officers, Chief Purchasing Officers, Chief Logistics Officers and Chief Supply Chain Officers, which you did not have before. You now have people looking at things more at the senior level. We find that now people look at things not just tactically but more strategically than just tactically and operationally. There has been a move afoot. You are dealing more with upper and middle management people than before; maybe we dealt with more middle management and upper middle management people in the past. I think that perspective has changed. I think the bigger part that has changed for us is that since 2008, there has been a dramatic change. We are in a very volatile, tumultuous environment, and it revolves around the things that we have expertise in. The unfortunate thing is that since 2008, people have cut back on money they want to spend; it is not that they do not have it to spend. Usually, the first area of a company’s expenses that tend be cut---happens to be our consulting and training, which are the two areas primarily of our business. We have potential clients, who want something, but they want something for nothing and they want it now. One of my favorite expressions is that you can get it cheap, good or fast – pick two. If it is cheap and good, it is not fast, and if it is cheap and fast it is not good. If it is good and fast, it is not cheap. What two do you want?
CEOCFO: How do you evaluate all the new technologies that come out that could possibly work for your clients?
Mr. Tanel: I would say that technologies might employ different practices. There are the both practices and the technology to consider. Every time you hear something that comes out, somebody says it is the newest and the best thing. I am not the one who is going to jump immediately on something. I would like to just sit back and look at what is there first. Technology-wise, yes, we are operating at a much higher level, and technology is changing more dramatically than it has changed in the last 10, 20 or 30 years. Every time you turn around, every year or two it seems, there is some new technology to keep up on. To see where it fits, I think that is the biggest problem that people have today. There is so much out there, and it is highly dependent on what best fits for your environment. People want to keep up with the Joneses, while maybe they are not Jones, they happen to be Smith. Many of the practices today are not necessarily new; consultants or the larger consulting firms have just repackaged them. And they call it something else. I go back in time and think of consignment stockless purchasing conceived about 35 years ago. That has now evolved into vendor-managed inventory, and now they call it integrated supply management. If not new, it is sometimes just a new term that people are using. There are not a lot of new things necessarily supply chain practice-wise, but there are a lot of things that people have refined. It is the same thing with outsourcing –formerly known as “make or buy”. You either do it yourself or you go out and buy it.
CEOCFO: It seems looking, at your website, that there is not a firm you have not worked with. Are there industries of more focus than others? How big a part is the public sector and what about the international element?
Mr. Tanel: Basically, I would say the big areas for us right now are oil and gas, typically because I think they have the money to spend. We do work with the government sector, and internationally we are starting to get into the two prime areas for us focus-wise, which are Southeast Asia and China. We are getting some areas of work over there and getting some publicity in those areas, which goes back to marketing. We were looking at the Middle East, but when the Arab Spring came about, that just about killed off any efforts in that area because of the volatility and geopolitical uncertainties. I would say that oil and gas, the government sector, and the public sector are becoming more increasingly involved in their supply chain roles. We are looking at trying to do anything from a cost reduction standpoint. In the cost reduction area, they are trying to look for ways to either avoid cost or reduce cost. Areas that they may not have concentrated or focused on in the past will be in the logistics areas, in particular on the purchasing side of the house.
CEOCFO: What have you learned over the years about dealing with government entities?
Mr. Tanel: First off, you have to understand bureaucracies. Then you have to learn how to read a government document – either a bid or a proposal’s documentation. If you do not specifically answer things, you are probably going to keep yourself from getting work or moving to the next level or step. Having had some experience dealing with the government and having served in the military, I think that has added to what we do in trying to do a better job. You really have to understand the documentation, and just because something is in writing, you may have to follow up with questions. The potential client will answer the questions and distribute all those questions and answers to anybody who may have submitted a bid or proposal. The second thing that you do with the government is that they are not going to just come out and have a select group of people who they may be looking at as providers, unless they are very specific. They are going to have to include potentially up to 200 different firms who do what you do and that you are in competition with.
Mr. Tanel: I think it has helped me out greatly. It is kind of funny – I got into the logistics field because I worked my way through college. I went to St. Johns, and I was a full-time undergraduate going during the days and I worked the night shift. I was a stocking person for Abraham and Strauss. I happened to have someone who took a liking to me. He was the director of operations, and he had served in the military. During my sophomore and junior year, I ended up joining the ROTC program. Somewhere along the line, I got promoted to a supervisor, which I was happy to do because I made more money. Once I got in there, I learned a couple of things, and I think they have probably helped me tremendously in what I do and what I try to do when I try to help people out by being a mentor. Number one, you learn leadership and teamwork skills. Back as a 101st airborne division company commander in charge of 240 people, I was 25 years old. I had a mix of men and women, and it was just beginning for the military to integrate females and males in the same unit, not separate units. I think you become trustworthy and you learn how to be dependable. You also have a strong work ethic. On my worst day, I can probably outdo most people. You learn to deal in a dynamic environment, and you have to make decisions regarding rapidly changing circumstances. You learn how to do things with a get it done attitude. You have to be resilient. One of the first leadership tenets you learn in the military is that to become a good leader, you have to have been a good follower at one time. I always have a hard time understanding how somebody is going to become a manager or leader, yet they have never taken direction or orders and they have never been a follower. Before you can give orders, learn how to take orders. I think I also learned a long time ago, you manage things, you manage resources and you manage information, but you do not manage people---you lead them. I think people forget about those two distinctions. I think that people are hung up trying to get things done, that they do not learn that the easiest thing you can do if you are leading people is to lead by example, as well as learn how to communicate well. A few tidbits that I bring forth from my military service; and I think I have tried to move them into what I do as a boss on a regular basis.
CEOCFO: What do you look for in people who work with you? What are the intangibles you want and need?
Mr. Tanel: It is kind of ironic. When I was talking to one of my people who is now officially retired said, “Some of our guys talk about retiring but still love what they do”. I look at our staff, and 90 percent of them are people who have been known by someone at CATTAN or we have known over the years and have been recruited or recommended. The key to that is that our people do well working in teams. I place a lot of emphasis on the people who have strong backgrounds in functional expertise as well as industry or related experiences. We always look at our people to make sure they are certified in a functional discipline, they have been there in the real world, and they have firing line experience. That is what makes us what we are. One of our mantras is, “Let our experience work for you.” That means we are hands-on, and we practice what we teach. One of my favorite historical figures I have been reading a couple books this past year about is Teddy Roosevelt. One of his favorite things to say was, “The best executive is the one who has sense enough to pick good men to do what he wants done and self-restraint enough to keep from meddling with them while they do it.” One of the great things for me is that I do not have to spend a lot of time managing our people that we have. They pretty much manage themselves, and they are natural self-starters. I think that having been around the block is what I look for in people as well as actually having done what we are professing. I think that is a great selling point for us as well. I was just talking to someone a while back, and I said, “I feel like I’m Mr. Phelps from the TV show Mission Impossible. He used to look through the staff pictures of the people available and ask who would be most applicable for the mission at hand.” By way of example, sometimes I am lining up a person and I say to myself he is a great project manager, but he might not be the best person at writing a report. I will put him with someone else on the project who I know is good at writing reports and tell that person to volunteer to write the first draft. I try to mix up the people as needed. Always align your assets to the mission and to the clients’ needs, and I think I do that pretty well.
CEOCFO: What is next for the company?
Mr. Tanel: To be honest with you, business has been somewhat stagnant since 2008. I think the rule of a supply chain just changed dramatically, and organizations are focusing on it, but people are not actually doing things. I think everybody is waiting to see if the economy is going to turn around or if things are going to get better. They know they have to do some type of supply chain transformation. I think the term that I have heard many times is the “New Normal”. I think what is difficult for people today, and for our business as well, is that everybody relied on what happened historically in the past to project to the future. Today there is more weight given to what is going on presently, and nobody can make those predictions. Donald Rumsfeld, former Secretary of Defense, “Reports that say that something hasn’t happened are always interesting to me…” as I remember in answer to a question at a press briefing, and he continued, “Because, as we know, there are known knowns; there are things we know we know. We also know there are known unknowns; that is to say we know there are some things we do not know. But there are also unknown unknowns-—-the ones we don’t know we don’t know.” That is how I see business today. There is that uncertainty, and everybody knows to expect the unexpected, but it is like they are all waiting for something to happen. People are talking about how businesses are sitting on billions of dollars of cash, but they are afraid to spend it because they do not know what is going to happen next. Just look at the economy. Every time you turn around, the economy is getting better, but then it is not. I think that leads to uncertainty, but also a lot of ambiguity. For those us in business, I do not know where we are going to be five years from now unless things get turned around.
CEOCFO: Put it together for our readers. Why pay attention to CATTAN?
Mr. Tanel: I think over the years, we at CATTAN have established a reputation for functional expertise, analytical abilities and good operations oriented tactics. The other thing is common sense. We are positioned to help that person or organization that will be asked to understand and manage global supply networks, which have become increasingly complex. It requires skills that we have in understanding the different types of issues. They become even more daunting, because now we are talking about things that cross borders. Many of the problems people have are supply chain related. Our familiarity with the concept of supply chain celerity—rapidity of motion or action—is a necessity for companies as today’s supply chains move at a higher velocity than in the past and extensive supply chain communications require you to be more agile and responsive to your customer’s needs. The timely and accurate exchange of information is more important than ever. There is little or no tolerance for errors or bottlenecks—and anything that is not immediately corrected can result in costly delays, penalties or potential cessation of activities for your organization’s suppliers, transportation providers, and trading partners.
information. We have a lot of data out there, but that does not always mean
people are getting the information. You hear terms like big data and
analytics. It is nothing more than being able to take a deep dive down to
find out that data becomes information when I put it into a usable format or
report, and that report or format allows me to gain knowledge, and knowledge
is the ability or the power to get things done. I think that is where we can
add some value to clients. I think we are positioned to do well and help
organizations. It is just that those people and organizations may not be
willing to spend the money and take the time to do it.
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