How (And Why) You Need To Hire Diverse Candidates

Diversity of all types in hiring is important – and more beneficial than you’d think! Here’s why and how you can hire more diverse candidates.

Diversity is nothing new, and we all know that it’s important. But somehow, knowing doesn’t always lead to action when it comes to hiring, especially at leadership levels. From a gender perspective, less than 10% of all supply chain executives are women, and candidates who identify as BIPOC (Black, Indigenous or People of Colour) also remain underrepresented. Beyond this, the pay gap in procurement remains very real, something that may worsen as we undergo what experts call a ‘pink recession’ as a result of the fallout from the COVID-19 pandemic. 

As leaders and hiring managers in procurement and supply chain, it’s our job to fix this. But how? Here’s exactly why diversity is so important, and some important steps you can take to ensure you hire more diverse candidates for your team: 

Why is diversity so important? 

Many of us know that diversity is important because hiring people that best represent what our society looks like is the fair and just thing to do. But beyond simply being the right thing to do, did you know that diversity has some incredibly important benefits for your team? 

As a function concerned with cost (and cost savings), diversity can deliver tangible business benefits to procurement: research shows that diverse teams are, on average, 15% more profitable. Diverse teams also offer a range of different perspectives on issues, which has been proven to benefit risk management.  Diverse teams also solve problems faster, are more innovative, and are better at engaging with stakeholders. In a nutshell, hiring from a diverse candidate pool pays off – big time! 

How to hire more diverse candidates 

When people talk about diversity, usually they are referring to characteristics such as gender, race, or sexual orientation. But diversity can – and should – mean so much more than this. Diversity can refer to anything from a candidate’s religious beliefs to their background or even the industry they have previously worked in. 

Any diversity is good diversity, yet hiring for diverse candidates can require hiring managers to rethink elements of the hiring process. Here are four ways to hire more diverse candidates: 

Tip 1: Pick one metric to focus on 

When it comes to diversity, there are lots of different characteristics to consider. In order to be effective though, experts recommend that you focus on one area only (whether it be something like gender, or perhaps even hiring outside of your traditional candidate experience profile). Once you pick an area, assign a SMART goal to it. 

Tip 2: Review and update your candidate sourcing mechanisms 

In order to attract what we think will be the ideal person for our team, we are often very specific with the requirements we say we need. Yet in doing so, we can turn other candidates off in a myriad of ways – from those who think they may not have the exact experience we need, to women or BIPOC candidates who may not feel they fit the description. 

It’s important to work with a recruiter to create a job advertisement that can attract a variety of talent, and this may mean using language or descriptions we haven’t used before. For example, some words such as ‘ambitious’ can be considered more masculine, and may be off-putting to a female audience. If you want to check your language, this tool can help you decode it.

Tip 3: Try blind shortlisting

Think you don’t make assumptions about candidates? Think again. All of us are guilty to some degree of unconscious bias (social stereotyping), but this can really stand in the way of diverse hiring.

This can be somewhat avoided though through doing what is called blind shortlisting. When you are shortlisting candidates, ask the recruiter to remove identifying details such as names, addresses and even previous companies (replace it with descriptions such as ‘a global mining organisation’). Removing identifying information can help you more fully judge a candidate on their merits, as opposed to making assumptions. 

Tip 4: Try intelligent shortlisting

Have you ever written a job description for someone in your team, only to realise that you yourself wouldn’t have the required skills and experience to do the job? The ideal set of skills we need on a job can be quite different from what’s really required, and intelligent shortlisting can be a way to circumvent this. 

Intelligent shortlisting can be achieved via your ATS (talent management system) or simply by surveying those around in your team. Take a look around you and see who really has what experience. You might be surprised. 

As the complexity and risks inherent in global supply chains increase, it is going to be even more important to hire a diverse team. So important, in fact, that doing so is one of our Big Supply Chain and Procurement Ideas for 2021. And when it comes to diversity, Ronin Ltd recommends that there is soon going to be a certain type of talent in the market that we all need to focus on attracting. Discover what it is, alongside our other big ideas, in our compelling whitepaper 100 Big Ideas for 2021.

Negotiating With Empathy & Respect Doesn’t Make You Weak

Stop fearing negotiations! Learn how to reframe them from conflict to mutual respect and empathy, save face, and both walk out winners.

The sexy part of procurement is often seen as the negotiation phase

It’s the part of the project where the junior employees (who have done all the grunt work) are pulled off the project and senior management dusts off their suits and are rolled in for the “heavy lifting”. The outcome of which often goes one of two ways: either champagne is popped at the close of negotiations or, alternatively, someone mysteriously disappears to “seek opportunities elsewhere”.

But, negotiations are built off a myth. Let’s explore this by starting with a question.

What’s your reaction to the thought of having to lead a negotiation?

If you said “panic”, you wouldn’t be alone. 

We can all relate to this scenario: your stakeholder is happy with the procurement process that’s been completed … but there’s one thing. The pricing needs to be negotiated and some of the terms need to be pushed back on. Actually, there are a few areas the business owner has decided need to be sorted before the contract can be signed.

This is the point when terror can creep in. You don’t know if you’re ready for an all out war with the supplier – in fact, you’d be happy to concede some points if you gained ground on some of the more important areas.

Negotiation is wrapped in a myth and it’s time we bust it open.

Negotiation myth

Negotiating is typically seen as:

  • Something you have to learn through a course
  • A persona you have to become, leaving your “normal” self at the door
  • Hard, serious, take-no-prisoners approach
  • Directly correlated to your career success or failure
  • Confrontational
  • A considerable investment in time, effort and resources

Time and place

There are projects that do warrant an approach outlined above, where the stereotypical negotiation style needs to be adopted but it’s not needed for all negotiations. There are other areas of traditional negotiations that are important too, like negotiation plans, checklists and planning / rehearsing meetings.

Here’s an idea: what if we started to adopt a negotiation style that was built on mutual respect, where it doesn’t matter what the other side represents or may be plotting? What if we bring our authentic selves to the negotiation table?

Saving face

Saving face is a concept used to describe the facet of a person’s image that they want to retain: it’s connected to their identity and dignity. Nobody wants to be made a fool of or shown up. Saving face is about respecting that human desire. In negotiations, if there is awareness of saving face it can lead to better outcomes as both sides retain their image and reputation.

Negotiating with empathy

Here are some alternatives to the stereotypical negotiation blood bath:

  • Don’t call it a negotiation. Pick up the phone and structure a conversation around finalising the contract. “We’re almost at the finish line, I just want to run a couple of things by you to tidy up some loose ends so we can proceed to signing.”
  • If it’s about price, be honest. You’ll save a lot more time if you can give percentage thresholds where your business would have more comfort. “Look to be honest, you’re at least 10-20% above where our CE would feel comfortable proceeding. Other bids have come in closer to our mark but it’s your methodology and solution we’re seeking to proceed with.”
  • In New Zealand they often open meetings with the Maori custom of a mihi which shares who they are, where they come from, which acts as an offer to create a mutual meeting space where all are equal. Could you start the meeting with an informal conversation to shift the environment? Or share something from your own culture?
  • If you’re struggling with someone on the other side of the fence try something that will speak to the person they are, not the role they are playing. Flattering their experience in their field can act as a good way in “clearly you have extensive experience in this area, [begin your point]…”
  • Empathising with their view to show you hear and understand them. “We can see that it’s important to your business to guarantee continuity of supply and we can understand where you’re coming from. We need to ensure x,y,z. Is there a mutual place we can agree on?”
  • Syntax is important. An old tip from the pros is to use the word “and” instead of “but”. The latter implies that you are about to contradict what you just said and also disregard their point of view. “And” implies that you are joining two views together.
  • Research active listening and practice it for a week or so before your negotiation meeting. 

The tips for moving negotiation towards empathy and away from confrontation are centred around respect principles. Give it a try and share your tips in the comments below.

Costs Increasing? Doing This Will Show Your CPO You’re Still Adding Value

Help turn your CPO’s frown upside down by benchmarking your performance and demonstrating your value. Learn how to here.

Suppose you wanted to own the fastest car in the world. When you were shopping for that car, would you simply ask: How fast does it go? Or would you instead need to ask: How fast does it go in comparison to all other fast cars? That’s the thing about having something the fastest, or indeed, doing something well at all: it isn’t done well if it isn’t done well in comparison to something else. 

The same is absolutely true when it comes to supply chain management. 

At any one time, it’s likely that something in your supply chain will be changing in a less-than-favourable way, and this will irk your CPO. But a great way to show that you’re still adding value is to invest in supply chain benchmarking, which is critical to success and one of the big supply chain and procurement ideas.

So what is supply chain benchmarking, and how can you get started with it? 

What is supply chain benchmarking? 

When you aspire to own something like the fastest car in the world, the metric you use to measure its speed is pretty simple. The car either goes faster than all other cars, or it does not.  

Anyone who has worked in procurement and supply chain, though, knows that things in our profession are unfortunately not always that simple. At any one time, there will be a number of trade offs that make meaningful comparisons more challenging. 

Despite this, supply chain benchmarking – or the act of comparing your performance to various available indices – can help establish that even if things might not look so rosy in your category or area, they actually are. Benchmarking also has other important benefits, including helping you and your team identify gaps, innovate, and focus on continual improvement. 

One commonly used index that may help you compare your performance against others is the SCOR method (of which benchmarking is just one part). You can use the SCOR approach to assess your business based on three pillars: process modelling, performance measurement, and best practice. 

How can you get started with supply chain benchmarking? 

Benchmarking can sound daunting, and there is no doubt that it can be a little time-consuming, but the benefits are certainly worth it. In order to get started with benchmarking, experts recommend: 

  1. Start with internal benchmarking: Sometimes, excellence can be sitting right in front of you. For that reason, especially if you work in a large organisation, it’s important to start your benchmarking internally. What are other business units doing better, both locally and globally, and how can you imitate their successes? 
  2. Review available indices: There are many available indices against which you can measure your performance, and it’s important that you choose one that makes sense for your organisation. For example, Gartner offers many different indices, as does Benchmarking Success. You can also use the methodologies detailed in the Supply Chain Index.
  3. Analyse your findings: No one knows your business like you do. So after you’ve finished your benchmarking, ensure you analyse your findings. Pay attention to lessons learned, but also take the time to understand why it might not be possible to be the best of the best in every metric for your particular business. 

But should you track all of your spend when measuring against indexes? Anklesaria Group recommends you should only track a certain amount. Discover what that amount is, and many other game-changing ideas, in our compelling whitepaper 100 Big Ideas for 2021.

7 Reasons to Hire on Contract for Supply Chain!

There’s more to short-term contracts than covering someone’s maternity leave: there are very good reasons to employ contingent labour – for you and the contractor alike! Sam White from Argentus unpacks the strategies behind Contingent Staffing.

Economists have done a lot of analysis on the rise of the so-called “gig economy.” More workers are using short-term contracts and other forms of employment to provide additional income to supplement or replace permanent jobs – think Uber, DoorDash, etc.

But more and more companies in a variety of industries are also bringing on high-skilled contingent labour for white collar positions in a number of impactful business functions like Technology, Procurement and Supply Chain. 

These roles typically have similar compensation to permanent employment, with the exception that they’re on a fixed term (typically three, six, twelve, or eighteen months). Working more independently and “hitting the ground running” faster than perm employees, these workers work in consultative fashion to expand Supply Chain and Procurement capability for their clients, and then move on to the next contract.

For many of the top performers, contract work is no longer a stop-gap to permanent employment – it’s an opportunity to work in a variety of industries and projects, and broaden their experience.

So what situations are these companies using contingent staff for?

There are a variety of business cases that corporate leaders are making for contingent staffing, recognising it as a strategic and cost-effective tool in their hiring arsenal. 

We put together this infographic to show some of these use cases. It places a special focus on our recruitment specialities of Procurement and Supply Chain, where our clients have increasing needs.

We start from the less strategic, more common reasons for hiring contingent staff, and move into the strategies that the most innovative business leaders around are adopting today.

This article has been republished here with kind permission from Sam White at Argentus. What’s been your experience with contracting and the gig economy, as a worker or in hiring staff? Let us know in the comments below.

“Your Procurement Project Has No Budget. Prove You Need One.” Too Harsh Or Just Right?

Been asked to justify every single expense for your procurement project? Here’s how to implement a strategy that works to do this.

Picture this (and maybe you don’t need to because it has already happened): you’re successfully managing a procurement project – one which you consider to be critical to the organisation – then the unthinkable happens: The CPO approaches you and says “Times are tough and we’re cutting costs. As of today you have no budget. Prove to me why you need one.” 

It sounds extremely harsh; not to mention unrealistic! But is it? Reevaluating everything from the group up is one of the big supply chain and procurement ideas we think will change everything in 2021. But how do you successfully adopt such an approach, and what benefits can it bring? 

What are the benefits of working from the idea of a ‘zero budget?’ 

It’s a well-established fact that most of us in procurement are trying to save our companies’ money right now, but we’ve all equally acknowledged that simply asking our suppliers for a blanket discount is not only inappropriate, but just won’t deliver the savings we need. So what should we do instead? 

One effective cost control method is to imagine you simply don’t have a budget for the procurement project you want to undertake. To start this process, you meticulously analyse every single line item in your project, and attempt to justify its existence. This strategy, which is effectively the opposite of relying on historical purchasing patterns, enables you to rethink and justify everything you’re doing – and hopefully figure out how to control costs more effectively in the interim. 

This approach, which does require a considerable amount of time and effort, has in years gone by been dubbed ‘too harsh.’ But how about during years like the one we’ve just had? It may well be realistic, appropriate and, most of all, needed. 

How do you restart the planning process for your project with no budget?

If the idea of justifying every single line item cost in your procurement project sounds like a lot of work, it’s because it is. But it certainly isn’t no pain for no gain, as the level of analysis required enables you to innovate and cut costs in ways you never would have imagined. 

In order to implement a such a strategy, experts recommend the following: 

  1. Get into the mindset of ‘you have no budget. Prove to me you need one’: As harsh as this sounds, this is the exact mindset you will need in order to truly justify every single expense. 
  2. Get management’s buy-in: The analysis required to implement such an approach will likely take time (it may take weeks or even months), so buy-in from the CPO and above is necessary. 
  3. Know that training and dedication will be required: When committing to such an approach, there is no point trying it, and then reverting back when it’s too hard. It’s an all-or-nothing approach and you need to see it to the end for it to be effective. 

In addition to the above, there is one essential question you need to ask yourself when implementing this strategy, and it might be a truly uncomfortable one. Discover what it is, and many other game-changing ideas, in our compelling whitepaper 100 Big Ideas for 2021.

Why Procurement Will Soon be One of the Most Sought After Professions

As jobs disappear and the roles of tomorrow don’t even exist today, what makes Procurement and Supply Chain professionals so hot in demand?

We’ve seen in the past year how easily the entire global job market can be disrupted. With luck, businesses and economies will recover, but there’s nothing “normal” about where they’ll be in the coming years. Thanks to industry 4.0, work as we know it is on the cusp of big change — in fact, some experts and futurists are hesitant to even predict what kinds of work will exist twenty years from now. What we do know is that it won’t involve many of the jobs we’re so familiar with today.

It’s not just manual labor that is likely to go away. Doctors, lawyers, and even police officers will also see their professions being increasingly automated. The outlook isn’t bleak, it’s just uncertain. But what practical information can we take away from that … and what does it have to do with procurement?

The vital nature of procurement in business

Let’s start by answering the question, “What is procurement, anyway?”

Procurement is the sourcing and purchasing of goods and services for business use from an external source. All businesses use a variety of products, services, and supplies in their day-to-day operations, but most of them don’t manufacture or create those things themselves. Instead, they buy them from other businesses, and procurement specialists are the people who oversee this process.

Take Apple, for example. Apple “produces” millions of devices per year, but manufactures very few. Instead, the company relies on a complicated web of supply chains from which it gets goods and labor. Woven together, these various supply chains create the things we recognize as Apple products and services — everything from iPads to Apple TV+. It’s not just electronics and technicians that Apple needs, either; it also has to have desks and chairs for its employees, paper and appliances for its internal business services, security guards and parking lot attendants for its headquarters, and the list goes on.

Procurement is obviously a big part of doing business. But what makes it one of the most desirable fields for younger workers to target?

In 2019, the ILO Global Commission on the Future of Work boldly predicted that “Today’s skills will not match the jobs of tomorrow, and newly acquired skills may quickly become obsolete.”

While the future of many jobs is unknown, procurement is one that’s here to stay. Aspects of the profession will undoubtedly change, and it will certainly be bolstered by exponential technologies like artificial intelligence and data science, but overall, the skills that underpin successful procurement practices today will remain relevant throughout the foreseeable future.

Largely, those skills consist of cognitive flexibility and critical thinking, good decision-making, emotional intelligence, and an innovative mindset. And those (surprise) are among those that experts and employers alike say will be most important during the next decade.

X-Factors that make procurement so dynamic

The desirability of procurement as a profession goes beyond job stability. As much as anyone else, the people overseeing where goods and services come from have a unique opportunity to influence a company’s profitability, sustainability, and ethics.

Environmental impact

Green, sustainable, or eco-procurement is a growing part of the field, and it centers around building supply chains that cause minimal damage to the environment. This can mean identifying opportunities to work with providers who are conscious of waste reduction or energy conservation, for example. In the case of individual suppliers, the impact might seem marginal, but as procurement policies increasingly reflect our collective push toward sustainability, providers that aren’t eco-conscious will slowly get pushed out in favor of competitors that are. It’s the procurement professional’s privilege to lead that charge.

Diversity and inclusion

It’s not feasible, in most cases, to force an equality mindset onto a business or other organization — nor would it be effective. The pathway to lasting change involves creating an environment in which the businesses that already embrace equality rise to the top, and those that don’t are required to face the organic consequences. This, too, is something procurement professionals have a special ability to influence. Just like with sustainability, a company’s procurement department can create a ripple effect in the industry at large simply by giving preference to suppliers that embody the company’s own ethos regarding diversity and inclusion.

Powerful trajectory

Much of the reason that Apple has achieved such amazing success even following the death of Steve Jobs lies with the fact that Tim Cook is intimately familiar with the importance of procurement to the business model. Cook was hired by Jobs as Apple’s Chief Procurement Officer in 1998; by the time he took the top executive office in 2011, Apple’s supply chain was widely held to be the best among big tech firms. The skills and knowledge that make a good procurement professional, in other words, serve as a strong foundation for success on an even bigger scale — in Cook’s case, it was the biggest scale in the world.

Looking ahead

As jobs disappear, consumer needs evolve, and the work paradigm shifts, the ability to “go with the flow” is becoming increasingly important. Not only is procurement an area that benefits from that ability — it can also impart it. In return for bringing their skills to the field, professionals who choose procurement will be rewarded with the chance to usher in large-scale change, guiding not just companies but entire industries and economies in worthy directions.

Stephen Day is Chief Procurement Officer at Kantar and an accomplished International Executive, with expertise in operations management, supply chain, and more.

Tired Of Small Orders Delivered In Huge Boxes? Technology Has The Answer

Ever had something the size of a credit card delivered in a box that could house the whole telephone exchange? Jonnie Penn describes how AI is cutting packaging down to size, literally.

You order a new phone case online, and it arrives in a box bigger than your fridge. Then you have to dig through packaging material to find the case.

It’s a common experience. In fact, 73% of consumers have received packages that were twice as big as necessary.

Not surprising, 40% of the average shipping box is wasted space, according to one estimate.

Not only is it annoying, more than half 54% reported they would think twice before ordering again from a company that had excessive space in their packaging. 

It’s frustrating for customers, it’s expensive for businesses and terrible for the environment. Since we’re all shopping online more, isn’t it time something was done?

Luckily, technology has the answer.


One company, PackSize, created a machine that automatically detects the item you’re shipping, then folds a cardboard box to the perfect size. 

That means more boxes per truck for a more efficient load and less carbon footprint.

And the right-sized boxes cut down on packing materials, saving USD $0.50 materials per box. Goodbye plastic air pillow packaging!

Smarter boxes also means better protection and less damage, says PackSize. 

That’s important when the average package is dropped 17 times before it arrives. 

How does it work?

PackSize combines clever automation with artificial intelligence (AI). It assesses the size of a product, then chooses the best fit from hundreds of possible box dimensions.

It’s just one way AI is changing our industry for the better.

In fact, McKinsey identified supply-chain management as one of the top sectors that will benefit from significant cost decreases due to AI
Where exactly will these changes be felt? The 2019 Global AI Survey isolated spend analytics, logistics-network optimisation and sales and demand forecasting as three areas in which AI high performers have reported savings in the supply chain sector.

Customer demands are changing

The idea of this highly sophisticated technology might seem scary.

A lot of people in supply chain are worried about the robots taking their jobs. But actually, technology is needed to meet the changing consumer demand.

“Customers want products and services in their hands more quickly; they expect a more personalised experience and all this at a lower cost,” says Vikram Murthi of Llamasoft

“Which means more customised products and services, faster order fulfillment times and super efficient delivery. This will require an entirely new way to architect, design and manage supply chains across broader ecosystems, new technologies and new roles and skill sets.”

How AI is changing supply chain

Everyone throws around terms like AI, but what does that actually mean for supply chain? 

“Tech leaders herald artificial intelligence as ‘the next electricity’ or fire,” says Jonnie Penn, an artificial intelligence expert at the University of Cambridge and keynote speaker at the 2020 Big Ideas Summit. 

“These bold claims convey that AI will be disruptive, but not why or how such technological change will unfold. “

AI at work

That’s why AI makes most sense when you see it in action, Penn says.

Like Attabotics, a Canadian company specialising in high-density vertical storage using machine learning and 3D robotics. 

Their compression system reduces warehouse footprints by up to 85%, a reimagining that promises new micro-fulfillment centers around the globe. 

Or Caterpillar using ship-board sensors to calculate that cleaning the hulls of their eight ships more frequently (e.g. every six months rather than every two years) reduced drag and minimised energy waste. 

“That insight saved them five million dollars per year,” says Penn.

Saving the planet

Clever application of AI could also go a long way for sustainability.

“Since 80 percent of greenhouse-gas emissions are due to supply chain management, this pressure will not abate in the decade to come,” Penn says. 

“Even small gains made through AI could mean large steps towards the UN’s 2030 Sustainable Development Goals.”

Jonnie Penn is a Rausing, Williamson and Lipton Trust doctoral scholar researching artificial intelligence at the University of Cambridge.  Follow him on Twitter at @jonniepenn

This One Surprising Trait Will Help Increase Procurement’s Visibility In The C-Suite

Could this be the end of charts, diagrams, and facts & figures? Master this trait to increase your visibility and be remembered like nothing else!

Increasing the visibility of procurement in the C-suite is something that is constantly on every CPO’s agenda. But how do you do it? Work harder? Save more? Negotiate better? The answer very well could be none of the above. 

Heralded as one of most coveted up-and-coming leadership skills, the one surprising trait that may help you increase visibility in the C-suite is the ability to tell a story. Yet sharing ideas with the C-suite is a learned skill, and you need to hire (or be) the person who can explain these ideas in a compelling way. Here’s exactly why storytelling is so important, and how to tell a good story (or hire someone who can): 

Why is storytelling important?

Have you ever found yourself forgetting facts, but remembering a story? If so, you’re not alone. The human brain is hardwired to remember stories, so much so that we are 20 times more likely to remember something if it’s in story form. Think about that for a second. Your CEO will be far more likely to remember your presentation if you take your graphs out and put a story in instead! 

Beyond that though, stories are important for a number of reasons. Firstly, they are far more likely to change opinions and behaviour than simply data and facts. Secondly, they are far more engaging, and hence more likely to capture the attention of whoever you are talking to. Finally, and perhaps most importantly, research shows that people find stories more trustworthy. With evidence like that, it’s hard to imagine presenting data ever again! 

How to tell a good story

It’s clear that there are multiple compelling reasons to become a better storyteller, or to hire someone who is. Storytelling is definitely a learned skill and not something that should be left to marketing, so if you are hiring, ensure you look out for the examples below when asking a potential new hire to describe their experiences. But if you’re not hiring, it’s absolutely possible to better your own storytelling ability. Here’s how to make your stories really shine:  

  1. Share something personal: Clearly, discussions with senior executives are no time to be discussing your personal life. But by sharing an anecdote or a little bit of personal information from the work you do, you can help create a more human connection. For example, perhaps you have an interesting supplier story you can share? 
  1. Write your story first: Spent hours on your slides, but no time preparing your pitch? That won’t work if you’re storytelling. If you do plan to insert a story into what you’re doing, make sure you draft it first so you can deliver it confidently. 
  1. Know who you’re talking to: Do you know nothing about the executive you’re talking to, besides their name? This won’t help your story, unfortunately. If you can find out something personal about them, perhaps something about their interests or even their concerns about the business, you can look to personalise your story to make it more impactful. 
  1. Bookend your story: Despite the fact that people are more likely to remember stories, they can still be forgetful – in fact, people are far more likely to remember the first and last thing you tell them than anything in the middle. For this reason, try to bookend your story by starting with an exciting anecdote and closing with something your audience can resonate with.
  1. Insert a joke or a surprise: Let’s face it, presentations can be a little dry sometimes. To lighten the mood and add intrigue to your story (where appropriate) add a joke or a surprise. It can help draw your audience’s attention back to you. 
  1. Get outside your comfort zone: Storytelling can feel uncomfortable at first, and that’s ok. Practice makes perfect, so ensure you take a risk and try to get outside your comfort zone. You never know how much visibility it could give you. 

MRA Global Sourcing believes that all hiring managers should prioritise the skill of storytelling. Learn more about this, as well as many other game-changing ideas, in our compelling whitepaper 100 Big Ideas for 2021.

How To Ask Suppliers For Discounts The Right Way

Before you even think of demanding a discount from your suppliers, try these avenues first – they’re far less treacherous routes

An essential part of procurement’s job, and something that will always be required of procurement, is to negotiate the best supplier deals for the business. And as much as we talk about strategic procurement (and this is really important), procurement’s success will always be measured by cost savings. Those savings are not the only way our success is measured, of course, but they are one of our raison d’etres.

So we know we need to save money for the business, but what is far from settled is how. Is a demand letter appropriate, especially in this year’s challenging business environment? Or should we use a more relationship-based approach? We’ve tackled the topic from a number of angles this year, so here is the very best advice from industry influencers and experts.  

What not to do

While the exact mechanisms of what to do when asking for supplier discounts is up for debate, there is certainly some consensus on what not  to do. When a post from Procurious Founder Tania Seary asking whether it was ok to send your supplier a demand letter asking for a discount went viral earlier this year, the procurement community seemed to be united on the fact that this wasn’t ok. 

In a nutshell, many people thought that this approach was a little arrogant, and that it gave the impression that you were a ‘big brand, doing it just because you can.’ And while this approach may have been acceptable 20 or 30 years ago, now it most certainly is not. 

More than that, though, many people didn’t like the idea of generic demand letters simply because they didn’t work. Discounts depended on good relationships, and demand letters did not cultivate those, as one procurement professional noted: 

“Customers depend on suppliers and vice-versa. It’s a big ecosystem, and [we all need to remember that] if you squeeze out small suppliers and competition lessens, costs will inevitably increase.” 

Keen to hear what everyone else said? Here’s the original article. 

Developing strategic supplier relationships

When it comes to asking for discounts, the consensus seemed to be that doing so through establishing strategic supplier relationships was the best way to succeed. But how exactly do you do that?  

Joe Lazzerini, Manager at Corcentric, enlightened us on how we can establish these successful relationships, and there are many more avenues to doing so than you might think. 

According to Joe, many of us take the attitude of ‘if it’s not broke, don’t fix it.’ But when it comes to relationships, we shouldn’t be taking this attitude, but instead always be looking for the opportunity to improve relationships, streamline processes, and change cost models. In a nutshell, we need to challenge the status quo. 

This starts, he believes, with asking your suppliers the simple question of: ‘What can we be doing better?’ 

Beyond this, we should aim to improve on the following with all of our suppliers: 

  • Trust and loyalty (treat your suppliers as much more than just vendors) 
  • Technology and automation 
  • Adherence to payment terms
  • Communication plans
  • Creation of a dedicated Supplier Relationship Manager 
  • Internal alignment between Procurement and Supply Chain category leaders

Continually improving the above will drastically improve our relationships with our suppliers, which will, in turn, enable us to ask for further discounts. 

Potential areas for discounting

If great relationships enable us to ask for a discount, should we then just ask for one? Not quite, says Corcentric’s Joe Lazzerini. In fact, there’s so much more to discounting than simply hammering down the unit price. 

When asking for a discount, Joe recommends that you do as much preparation as possible, including considering how you can make discounting a win-win, and remembering that you need to collaborate, compromise, and at all times work with a partnership in mind. Here are 9 talking points to begin your discussion about cost optimisation: 

  • Contract length 
  • Reduced future cost increases with caps
  • Rebates 
  • Volume thresholds 
  • Delivery costs 
  • Payment terms
  • Ancillary charges 
  • Better reporting, more transparency, communication plans, etc. 

You can read more of Joe’s game-changing advice here. 

Relationships are always the right way 

This year, more than every other year before it, we’ve learnt that relationships, partnerships and people form the basis of success in just about everything we do. Asking for a discount is no different: if you first focus on developing a strong strategic relationship, everything after that will be more successful. 

How To Say Goodbye To Negative And Contentious Supplier Negotiations

Negative and contentious supplier negotiations ruining everything for you? Here’s how to negotiate in a positive and effective manner.

We’ve all been privy to supplier negotiations that have gone awry. The supplier begins to look uncomfortable. They avoid eye contact. Perhaps they even break out in a sweat, despite it being a sub-zero day. Alternatively, they get angry or perhaps they don’t say much at all, but then your relationship takes a nosedive and never recovers. They become the bane of your existence and you start wondering how the best deal could have turned into the very worst. 

No one likes negative and contentious supplier negotiations, and they often are the beginning of a poor partnership (not to mention relationship!). But are they necessary? Corcentric certainly thinks they may not be, and in fact, saying goodbye to this type of negotiation is one of the big supply chain and procurement ideas we think will change everything in 2021. But how do you do it? 

How to build trust in negotiations

The key to avoiding negative and contentious negotiations, says Corcentric, is to use trust-based and positive reinforcement based negotiations tactics. In order to build trust in negotiations, experts recommend six tactics: 

  1. Speak the supplier’s language

Supplier relationships are all about fostering an environment that feels like a win-win, and an important way to establish this in a negotiation is to speak the supplier’s language. What this essentially means is that you go beyond the facts of what you are being told and profile your supplier by trying to understand the perspectives, concerns, cultural and business implications, and even the less-than-obvious messages that a supplier might be giving you. 

In a nutshell, you listen a lot, and take the time to understand your supplier’s history, current business position, concerns, and even a bit about the person you are dealing with personally. A lot of this can also be industry-specific, and when learning about a supplier you also need to take into consideration industry norms and conventions, as well as industry terminology. Details that may seem small to you, include a unit of measurement (for example, a hectolitre), may be extremely significant to a supplier, so you need to be able to speak their language – literally and metaphorically. Doing so will help foster an emotional connection, and send the message that you’re committed to the supplier and the outcome, and will help build trust. 

  1. Manage your reputation

As many of us in the global supply chain and procurement community know, the world is certainly not as big as it seems. For this reason, your supplier’s reputation isn’t the only one you need to think about. 

Suppliers talk, of course, and what they say about you counts. So if you have a reputation for going hard on cost and squeezing out supplier profit, you had better believe that your supplier may already know this. Similarly, if you haven’t kept your word in a particular situation, or done something else detrimental that damaged your integrity, that supplier will have likely discovered this. In summary, if you’re known for any of these seven supplier negotiation fails, your reputation may be in trouble.

As such, always be careful of your reputation in the market. 

  1. Create an environment of mutual dependence

Regardless of your spend, if you’re bringing a new supplier onboard, it’s clear they will depend on you to some degree. And from your perspective, that dependence is power. But have you ever thought about it from the other perspective, insomuch as you need that particular supplier? 

Dependence is an uncomfortable psychological prospect, but research shows that its mutual existence does increase trust in a relationship. For this reason, try to establish the idea of mutual dependence by highlighting to your supplier the benefits of working with you and the positive mutual outcomes you’ll work towards. 

There’s significant evidence that procurement has already increased trust with the C-suite this year, so now it’s time for us to do the same things with our suppliers. 

  1. Make one-sided concessions

It’s something that many of us may feel uncomfortable with, but it is essential in gaining trust, and that is: make concessions. And not just any concessions: one-sided concessions. 

In negotiations, it’s difficult to not think that you, as the buying organisation, should have the upper hand. But in reality, what you are building is a long-term relationship in which you should be less focused on tit-for-tat concessions, and more on good outcomes. Before you concede, ensure that your organisation doesn’t suffer as a result, but you’d be amazed at what a single concession can do for trust in negotiations (and beyond). 

  1. Point out your concessions

Cringing at the idea of conceding? You might not like this news, but it’s a necessary evil. If you’re going to go to the trouble of conceding, you need to ensure that you deliberately point out what you have done. 

Why? Because pointing out your concession, including exactly how much you have given away and what that sacrifice will mean for your business (and hopefully, not just for your ego), shows that you are serious about looking after your supplier. Fortunately, doing this should also trigger their desire to look after you, further engendering trust. 

  1. Explain your reasoning 

Unfortunately, humans are simply not that trusting, especially in a situation which can be perceived as conflict, like a negotiation. For this reason, your supplier may assume the worst of you (and you the worst of them), before conversations have even begun. 

That’s why, when negotiating, it’s important to explain your reasoning for any demands you make. For example, say you require a certain percentage discount on volume orders. Instead of simply asking for this, explain that you need it to make your manufacturing feasible. Understanding your drivers will help give your supplier better insights into your business and how they might be able to help you. 
There is another, all-encompassing reason that we all need to avoid negative supplier negotiations. Discover what it is here, as well as many other game-changing ideas, in our compelling whitepaper 100 Big Ideas for 2021.

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