Speak the procurement language

Gregg Barrett AN ARTICLE in a recent issue of Purchasing Magazine advises that how procurement operates and sells its usefulness to internal stakeholders is a topic that doesnt receive enough attention. A tactic highlighted in the article is to ensure that you speak the language of your internal customer. Says Purchasing: Buyers need to work with internal stakeholders on defining the value of a service and provider more than reducing costs. While it can be appreciated that the current economic environment has more organisations and employees thinking about reducing costs, procurement must differentiate its value based on more than just cost savings. In a previous article, I highlighted the thoughts of Supply Chain Digest on the findings of a study by the Economist Intelligence Unit on the state of procurement. The digests interpretation is that barriers remain to procurement moving up on the corporate ladder . . . [based on] disconnects in perceptions between procurement execs and other company managers. Procurement-related staff think the biggest barrier to procurement becoming more strategic is the lack of understanding or interest by other functions in that evolution. Conversely, executives outside of procurement think the biggest barrier is that procurement managers dont understand the business well. If you look further at the study and consider that 53% of non-procurement executives either agree or strongly agree with the statement that the procurement function is too focused on cost and not enough on value and another 40% say the same about the focus on policies versus innovation, procurement has got its work cut out. In his blog, Tim Cummins writes: I have found there is a great divide in the legal, procurement and contract management communities. It is between those who feel that they are fully accepted and respected by their internal customers (executives, business unit personnel, sales) and those who consider that their role is undervalued. As an example, the contracts group often complains it is involved too late, that the extent of its contribution is limited by a failure to consult it earlier in the process. Generally, group members significantly outnumber the members of the accepted and respected group. In these times, being undervalued can translate to being seen as dispensable. So what can be done to address the problem? There are several steps that need to be taken. Cummins highlights a couple of points from The Art of Woo: Using Strategic Persuasion to Sell Your Ideas.

The steps take the form of nine questions we should ask ourselves before we go into meetings or have conversations with customers: 1. How does this individual perceive the problem I intend to solve? 2. What is the pithy summary of my idea that will appeal to this person? 3. What roles does this person play in the decision-making process? 4. What is my goal for this encounter? 5. What is the basis for my credibility with this person? 6. Will my idea conflict with any of this persons beliefs? 7. How will my idea conflict with this persons interests? 8. Can I leave the relationship better than I found it? 9. What kind of public commitment from this person would best build momentum? Many times, the groups that feel undervalued turn out to be those who rely upon a perceived executive mandate, for example, related to compliance. While this may be an executive desire, they also want to close business or ensure speed of execution. What they expect from internal staff groups is not just that we will recite rules but that we will find solutions and ways to reconcile conflicting priorities. Cummins says this comes down to having a can do attitude, something other internal customers also look for. So if you want to be among those who feel they are accepted as a part of the core team, remember that we must all be salespeople. We must explain how our expertise or processes will help to achieve the goals of our audience better, faster and with less pain or aggravation along the way. Customers dont come to legal, procurement and contract management communities because of their inherent virtues. They come because they see it as necessary if they want to reach a desired outcome or result. So if you want them to come early, willingly and often, you must make them see how your involvement gets them the results they want. Those who base their existence in the organisations upon a necessary evil can expect changes. Existence in the organisation must be based on a strong and sustainable value proposition otherwise expect to be automated and/or outsourced. The last word goes to Tim Minahan. He says the most successful procurement organisations are equally competent at selling as they are at sourcing. And, as every good salesman knows, success requires you to align your solution or service to support what the customer needs.