Let me begin by saying I don’t, never have, and probably never will work in procurement. I’m a Business Development Executive and much of that time is spent on the phone. I talk to people on a daily basis about our eProcurement software, PROACTIS. For the past year and a bit my one and only job has been to make contact with procurement professionals to understand what they want from a procurement system and explain what we do.
So outside of talking about PROACTIS, what ‘added value’ can I bring to procurement professionals reading this post?
The way I see it (bear with me while I spell out my credentials), who in the UK will have spoken to more CPO’s than me this year? Who in the UK will have spoken to more Heads of Procurement? How about P2P analysts, sourcing specialists, vendor managers…..outside of the procurement profession, it’s very probably no one.
So, what have I learnt?
Well. A lot. But my one overriding thought, day-in, day-out, is……my job is not so different to the people I’m calling. At this point I’d forgive you for thinking ‘How on earth can smiling and dialling all day come anywhere close to running a function which has more demonstrable impact on the bottom line than any other back-office function?’
We are both evolving
Our jobs are changing. In marketing it’s getting tougher and tougher to speak to people on the phone. Now it’s email, it’s Inmail, it’s giving value first, it’s social-selling. It’s about building better relationships, in short, it’s evolving. Procurement – from what I understand – is no longer beating suppliers down, it’s no longer extended terms and price-cutting. It’s about building better relationships and it’s evolving.
We both negotiate
Internally and externally. My aim when I make contact with people is to arrange a first meeting. Prospects are busy and need convincing my business is worth an hour of their time. My boss is busy and needs convincing prospects are worth an hour of his time. You need to sell why a supplier should work with you at that price, with those terms, for that length of time. You need to sell new suppliers and systems to the CFO, the CEO, the business unit heads and the end users.
We want value
We want what’s best for our business. It’s what everyone wants but no one’s quite on the frontline like we are. I want customers who need our solution and the business wants our customers to pay a fair price. You want suppliers who give you the goods and services that you want, you want the best supplier engagements, and you want to pay those suppliers a fair price.
The right tool for the job
The one main difference I see is I have a system which I record everything I do in. Email addresses, phone numbers, details of discussions I’ve had. How people want to be contacted, when they want to be contacted, and the systems they have. I have notes on what people people’s challenges are and what they want from a procurement system. If I want to send a bulk email to a specific set of prospects it’s very easy. It’s called a customer relationship management (CRM) system and I couldn’t do my job without it. I can’t bear to think about the amount of business I would have missed out on if I didn’t have it.
So imagine this. While I have all this information at my fingertips you have a list of suppliers on an Excel spreadsheet a consultant drew up in 2008. On that list you’re not sure whether you deal with Widgets plc, Widgets & Co or Widgets & Partners. You’re not even sure if Widgets (In whichever guise) is still in business. Where I can very easily get together a list of prospects and collateral for a targeted marketing campaign, you have to type up an RFP in word and send it to the next half a dozen companies who give you a sales call. When we win a contract, it’s electronic. We get updates on that customer. When they’ve paid their bill, when they haven’t, when it’s up for renewal. Your contracts are stored under people’s desks in regional offices. You have a vague idea of who they’re with and what they’re worth, but you’re not sure. Imagine you’ve negotiated a new contract saving the company hundreds of thousands of pounds, only to find out the incumbent contract has overrun and you’re tied into another three years; same price as before.
Imagine what your savings could have been?
I’m not a senior member of staff and yet I have all this functionality at my disposal. You are responsible for how your business buys – it’s an important job – and have nothing. It’s unfair and you know it.
You’ve told the FD and they don’t see the value, ‘isn’t it your job to ‘do’ procurement’?
If you’re struggling to prove the value, as you might expect, we’re here to help. There are tools that can do this for you, and they’re available from Touchstone Spend Management.