Friday, July 28, 2006

"This little piggy....."


We all remember the little ditty about the piggy going to market while they others either stayed home, had none and of course the one that whined all the way home!

The moral of this story it seems is the piggy that went to market was in fact that one that was most successful, as opposed to those that sat by the sidelines and expected things to be brought to them.

Similarly, in procurement, if you don't go out to the market you will never achieve the appropriate level of success in your organization. You will continue to be seen as an obstacle; a tactician; non-value add...the list goes on. The mistake most procurement organizations make is having the false belief that because we built it "they will come."

So where is your market and how do you go to it?

Obviously, the market is all the potential internal organizations within your corporation. You need to work these groups similarly as all the sales people whom you deal with daily from outside the organization.

You need to define your value proposition -- ask the question as to why it is of benefit to these areas to work with you -- what can it get for them? Most procurement organizations make the mistake of saying -- well we can get it cheaper -- only to find out that an internal client will say, "well actually I got it cheaper than your deal." Of course that is because they are focusing on price, not on the total deliverable cost! Identify your knowledge of the marketplace, the subject matter experts on your team, and the fact that you are about more than just price!

If it is a group or individual that is used to doing things on their own, ask to be part of their team -- don't force your way in. Indicate your team's willingness to be a participant -- the best way to demonstrate value is not by telling them about it, it is by showing it. Numerous times I have done this where the value was clearly demonstrated and then created client satsifaction, thus client loyalty.

Create Client Executive, Business Development type roles in your procurement organization. Similarly to the sales organizations, you cannot mine for more business if you don't have individuals focused on your clients. The individuals in these roles, live and breath with the internal clients, participate in their staff meetings, strategy sessions and sell the benefits of working with the procurement team. When you are seen as an extension of their organization and not a "separate" department, you will see how much activity begins to flow your way.

Just as with the suppliers with which you deal, you feel more comfortable in working with an organization if there is a level of trust regarding delivery, issue resolution etc. These client executive roles will build up that trust and the postive bottom-line impact that occurs from the utilization of these roles, will more than pay for their salaries.

So stop "wee, wee, weeing" all the way home. It is the pig that goes to market that brings home the bacon!

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