We recently ran a poll on LinkedIn. We asked the network how they really felt about meeting someone from the Procurement profession. Over 2,700 saw our poll, but only 21 brave souls felt safe in sharing their views.
We can’t help but imagine that had a non-Procurement professional run this poll, it might have led to a much better turnout. The results are for you to see below.
Of the 21 votes, the last two options (guarded and tense), which portray procurement in a more negative light, received 57% of the votes. Moreover, less than 1 in 3 people were delighted to see us. Ouch!
We either send shivers down the spines of those who dare to meet us, or at the least put them on high alert on what they should/shouldn’t say in our encounters.
The conclusion is clear. The Procurement profession needs a facelift and has probably needed it for a very long time.
As a fellow Procurement professional, I will share 4 things I do to instil safety in those who interact with me whilst on duty.
4 Ways to improve the Perception of the Procurement Profession
Here are 4 things that need to happen for the negative perception of the procurement profession to change.
1) Acknowledge we have no special language
Have you ever eavesdropped on two Technical Architects talking to each other? I don’t blame you if you haven’t; it’s a pointless exercise if you aren’t gifted with tech skills yourself. Unlike technology and other specialist areas, Procurement does not have a language of its own.
Everything we do and think about, can be easily explained and easily understood by the common man. A capable Programme Manager (our usual key stakeholder), for instance, would understand all the procurement basics.
What we are getting at here is that the skills and understanding we bring to the table are not that rare and inimitable. Therefore, if your ideas and thoughts are communicated in simple English it won’t be difficult for others to understand. And we certainly don’t have to labour any point, because our stakeholders get us.
What’s amiss, however, is that we don’t get them often. If supporting an ERP implementation, do you understand that Data Migration precedes Cutover, precedes Go-Live, precedes Hypercare…?
As Procurement professionals, we can sometimes confuse our “authority” as a reason to not invest enough in understanding other stakeholders. The more collaborative attitude is to upskill yourself so that you understand the language of the categories you support, even if that means diving into dull technology details.
Upskill yourself so that you understand the language of the categories you support.
2) Procurement risks don’t trump every other risk
On the whole, us procurement lot aren’t a greedy bunch. However, one thing is for sure. We often like our stakeholders to believe that procurement risks trump everything else. I have certainly been guilty of thinking this!
This doesn’t come from a bad place. We are all just so passionate about procurement matters, that we are perhaps a little biased in thinking the procurement function takes precedent. Nevertheless, displaying an attitude that we are special, fosters an unhealthy relationship with our business stakeholders. With a tarnished reputation already, this isn’t something we want.
Are you aware of the challenges that other departments in the organisation are facing? If not, you should. Even more so if some of these challenges are a direct result of our stakeholders applying our Commercial advice.
In the procurement profession, we focus on the organisation avoiding a penalty, a fine, or an adverse audit finding, for instance. However, other parts of the organisation are seeking to protect the organisation from other risks and issues. Regularly reaching out to understand the organisation’s issues will improve collaboration and help mitigate risks throughout the whole organisation.
To be regarded as a true business partner, we need to adopt a systems thinking mindset. Plus we should give our stakeholders the benefit of doubt, who might be acting contrary to sound Commercial practice. They may be acting in that way not to wind you up, but instead to protect the organisation against risks that you may not understand.
Procurement risks don’t trump all other risks in the organisation. Ensure that you are regularly speaking to stakeholders across different departments to understand their risks as well.
3) When thinking about suppliers, don’t always think of a stick
The thought that suppliers are a necessary evil is old school – and certainly not the case today. Suppliers bring a whole host of advantages. For example, they allow you to focus on your core competencies.
Moreover, on balance, a specialist supplier of ERP technology will be able to attract higher quality talent than an organisation whose core business might be engineering and construction.
It can certainly be tempting to think of building all competency in-house. However, from the perspective of the employee you are targeting, you will not be the most appealing employer out there. Sorry to break it to you!
The simple reason for that is that a high-calibre technology professional might see a career path if joining a tech hub, but they may not see anything beyond the current assignment in joining your organisation.
Remember that suppliers need to be incentivised to deliver their best to you. Although suppliers rarely refuse work even if you beat them very often, you may be missing out on them turning up their A-team or going that extra mile – unless they feel valued. Essentially, treat others how you would want to be treated.
The best way to think of supplier personnel is that they are an extended workforce who don’t have to be afforded employment rights.
Mounting evidence suggests that collaborative contracting practices improve project outcomes. Find out more in our blog post: What is Collaborative Contracting? [And why is it so useful?].
Suppliers offer tremendous value to the procurement department. Nonetheless, to get the best work out of them they must feel valued and respected.
4) Don’t be penny wise and pound foolish
The biggest cost savings will usually come from turnkey productivity improvement programmes, say, for example, robotic process automation, that requires high levels of investment. Naturally, it also means increasing your level of spending on external suppliers to get many-fold benefits.
A ‘spend more to save more’ approach may seem counter-intuitive to us in procurement, but the opposite is short-sighted. If the only goals you accept from top brass of your organisation’s leadership is a quarterly or annual savings target, it goes to show that the top management does not see Procurement as strategic.
I remember being tasked once, to ask all suppliers in my remit to drop their prices by 20% because our profitability was low. This ended up being a futile exercise. Neither was our ‘Why’ compelling, nor was there anything in it for our suppliers to lower their prices.
The best prospect of achieving long-term savings is by working in collaboration with your business stakeholders to identify programmes that can be commissioned that take out substantial costs. Not only is this the best way of achieving savings, but this is also a sustainable practice. The approach of trying to shave a few pounds off suppliers’ day rates or asking for wholesale price reductions, is sadly only a finite game.
If you want to learn more about managing supplier relationships, head over and listen to our podcast episode Managing Supplier Relationships – The Benefits of a Healthy Relationship.
Investing in turnkey productivity improvement programmes will lead to the biggest cost savings in the long run.
Our survey confirmed what we already suspected – that procurement professionals aren’t perceived well by others in the organisation.
The 4 techniques we have listed will help others see procurement in a more positive light – improving collaboration and transforming the odds of digital transformation success.
At Mindful, we provide Commercial consultancy that is supportive of our client’s major programme objectives.
With our Virtual Commercial Services, we offer a cost-effective option wherein we pair up with your organisation’s designated Commercial Manager to transform your commercial service to programmes from good to great.