PROCUREMENT AVOIDANCE BEHAVIOUR -- PROCEED AT YOUR OWN RISK!

After many years of ensuring that business stakeholders, both internal and external, find that engaging with the procurement team is of immense value, I am still astounded at the number of people who still espouse the "avoid procurement at all costs" philosophy. 

There are several elements to this Procurement Avoidance Behaviour which will be discussed over the next few blog entries

1. Suppliers thinking working around procurement is a good idea
2. Internal departments seeing procurement as non-value add and they are better dealing with the "buy" directly
3. Procurement organizations that are not working hand-in-hand with their clients and suppliers to enhance the overall business.
4. Procurement organizations that are not marketing their value proposition effectively

Suppliers 

Recently I was told by a salesperson that he is working directly with the end client in an organization and that this end client does not want to have procurement involved because they aren't working on his behalf and a deal struck with another firm a couple of years ago by procurement is affecting his bottom-line.

This salesperson had developed a whole approach, protocol and had buy-in from this end client and the next move was for the end client to "spring" this on the head office (this was a company that had a US parent from where the procurement decisions had been made) and for the end client to insist that this is what is best for his part of the business.

The salesperson was excited about undoing the loss of the business that had occurred a couple of years before. In other words, he had drunk the end client's Kool-aid.

I suggested to him that he had made himself the meat in the sandwich of a family feud and that this was not going to end well. Did he know what the contracts were with the other supplier? Could the Canadian market be split-off from the rest of the deal? Did his end-client know how the rest of the organization had benefitted by Canada being as part of the mix -- that is, even if it is costing him slightly more, how is the rest of the business benefitting? Did he realize that by working behind the

scenes and not having established any relationship with the US Procurement team, or having made any effort to find out  what their current business drivers were  -- he couldn't effectively position his firm for future business? (note he had lost the business three years prior, but hadn't made any effort to maintain a relationship -- read a previous blog of mine on this Where Have You Been). Did he realize that procurement members could help him, but if you cross them, by bypassing them, sending a message that you don't respect their input,  that a) they have long memories and b) they can make you look foolish by pointing out all the things that you don't know.

If you are a salesperson reading this, you might be thinking, "of course she's saying that, she's one of them!" But the reality is distinctly different.

I won't dispute that there are some procurement teams that don't get it, that are so rule driven and so enamoured with meeting their savings metrics that they forget that they are an enabler to the business, they should provide insight, innovation in deals and negotiation expertise. They should ensure that the company maximizes and leverages their buy. They should introduce new suppliers to their end clients who may provide a different approach which may be beneficial and help on the revenue side. They should work hand-in-glove with the business to ensure the best outcome overall.

But you know what? More and more procurement teams do get it! It is often the suppliers who are still behind the times and buy-in to the "end-client" who may have an agenda which is counter to the overall business.

To the salesperson with the scenario above, I strongly suggested that he convince his end-client to engage with procurement and that jointly, they present the planned approach. Not as a fait-accomplis, but as wanting procurement's input. 

Even if the proposal doesn't fly, he will find out things he didn't know (e.g "our current contract goes for another two years") and  the salesperson will have established himself as procurement friendly and family feud "agnostic." 

And this sets the foundation for a better relationship, one with procurement, as well as the end client and possibly business in the future.

The other way? Well, let's just say proceed at your own risk -- because it is truly a mine-field.