All posts by Procurious HQ

Procurious Big Idea #19 – Purity of the Supply Chain

Listen to Danielle Stewart, Chartered Accountant (an interloper by her own admission), tell how her Big Idea was borne out of a shopping trip to London’s Westfield Shopping Centre with her daughters…

More needs to be done to combat this so-called fast fashion culture, measures need to be put in place to ensure the workers that manufactured the goods are well looked after.

See more Big Ideas from our 40 influencers

Collaborative robots will soon support human workers

The ground-breaking humanoid robot will increase safety, efficiency and productivity in the workplace.

Development of one of the world’s most advanced collaborative robots begins today as part of an EU-wide initiative involving Ocado Technology and four of Europe’s leading technology research institutions.

Under the SecondHands project, Ocado Technology is coordinating a consortium of universities to create an autonomous humanoid robot. It will use artificial intelligence, machine learning and advanced vision systems to understand what human workers want and offer assistance with difficult maintenance jobs. For example, it will hand tools to human maintenance technicians and manipulate objects like ladders, pneumatic cylinders and bolts, abilities which cannot be found in any commercial robot. The objective is to increase safety, efficiency and productivity in the workplace.

“The ultimate aim is for humans to end up relying on collaborative robots because they have become an active participant in their daily tasks,” explained Dr Graham Deacon, Robotics Research Team Leader at Ocado Technology. “In essence the SecondHands robot will know what to do, when to do it and how to do it in a manner that a human can depend on.”

The initiative, which will span five years, and is expected to use seventy two person years (equivalent to 855 person months) of research effort to complete, aims to break new ground in robotics. Key areas of focus, include: 

  • Proactive assistance: the robot developed under the SecondHands project will have cognitive and perceptive ability to understand when the operator is in need of help, understand how this help can be given and provide relevant assistance
  • Artificial intelligence: The team will enable the robot to progressively acquire skills and knowledge needed to provide assistance. In fact, it will even anticipate the needs of the maintenance technician and execute the appropriate tasks without prompting
  • 3D perception: Advanced 3D vision systems will allow the robot to estimate the 3D articulated pose of humans and offer support when it is needed without being asked
  • Humanoid form and flexibility: A humanoid shape and human-like flexibility will enable natural collaboration between humans and the robot. It will feature an active sensor head, two redundant torque controlled arms, two anthropomorphic hands, bendable and extendable torso and a wheeled mobile platform

The SecondHands project, so-called because the robot will literally provide a second pair of hands to human workers, is part of the European Union’s Horizon 2020 Research and Innovation programme, which includes one of the worlds largest civilian robotics programs.

As coordinator of the project, Ocado Technology will work alongside University College London, Karlsruhe Institute of Technology, La Sapienza University of Rome and Ecole Polytechnique Federale de Lausanne. The technology firm, which powers Ocado.com, will build a special testing facility in Hatfield where the robot will be subjected to rigorous real-world trials.

UK’s competitive position in advanced robotics research strengthened

The development of one of the world’s first autonomous robots comes amidst research by Boston Consulting Group that identifies the UK as a leading adopter of industrial robots over the next decade. The BCG research complements findings by the International Federation of Robotics, estimating that the global market for industrial robots was worth $9.5bn in 2013.

Ocado Technology taking a lead in robotics research in the UK

The development of this bleeding edge robot puts Ocado Technology at the forefront of companies working on advanced robotics in the UK. The company currently employs ten robotics experts, from leading robotics research institutions, such as The University of Edinburgh and Imperial College London.

‘Soft hand’ grasping skills

In addition to the SecondHands project, Ocado Technology is also working on a second, complementary, Horizon 2020 project: ΣΩMA (pronounced “SOMA”) will see the firm partner with a number of universities to explore new ways for robots to physically interact with their environment. It is hoped this will create a ground-breaking robotic hand which can be used in conjunction with SecondHands.

Emulating a human hand, the robotic gripper will know when to grasp softly – such as when picking an apple – or to grip more tightly, such as when lifting a bottle of water.

Chris Sawchuk: How Procurement Is Elevating Its Role

‘We have to be more flexible, we have to be more agile, to react to these sorts of things…’

Watch our third Big Ideas Summit keynote (part 1 of 3)

Watch Chris’ keynote in FULL here

Looking to the future, Chris Sawchuk, Principle and Global Procurement Advisory Practice Leader at The Hackett Group, spoke about organisational agility and the need for organisations to adapt and move quickly in a constantly-changing business environment.

From a procurement standpoint, Chris argued that it means learning from the likes of Uber and being more customer centric and delivering value beyond cost savings, while being more active in promoting itself as a function.

Procurious members can find Chris’ full keynote here. Not a member yet? Register for free.

Google reports progress in removing conflict minerals from supply chain

Google has reported on the company’s continued commitment to removing ‘conflict’ minerals from its supply chain.

In a report (which makes up part of the level of disclosure required by the US government to eliminate the sale of raw materials from West Africa and Asia to fund violence and terrorism), the tech giant filed significant improvements in its performance over the last year.

The firm can now say with some certainty that 57 per cent of its facilities do not pull on ‘conflict’ minerals to support production. While this figure may appear meagre, when you consider that last year the firm could only manage the same claim for 36 per cent of its facilities, it’s clear to see that significant progress has been made.

Apple too has shown similar improvements in this area, with the firm reporting in February of this year that 60 per cent of its facilities met a requisite level of compliance as opposed to only 30 per cent in the previous year.

These moves further highlight the fact that both consumers and governments now see supply chain activity as a direct reflection (and responsibility) of the buying organisation.

The Apple Company came under intense scrutiny earlier this year when a BBC inquiry and television show highlighted both slavery and questionable environmental practices taking place within the firm’s downstream sourcing activities. Read more here.

How to Achieve Award Winning Procurement – Learn from the Experts at Lloyds Bank

In the latest in the series of articles on the CIPS Supply Chain Management Awards winners from 2014, we look at Lloyds Bank.

Lloyds-TSB-branch-014

Lloyds Banking Group is a financial services group with millions of UK customers and with a presence in nearly every community. A household name on the high street, the Group thrives based on how well it serves customers, on relationships within the communities that it serves and on helping Britain prosper.

Whether through retail banking, financial services or investments, there are probably few people in the UK who haven’t interacted with a part of the Lloyds Banking Group during their lives. What many people may not immediately associate with the Group is a very successful procurement function.

However, over the past three years, and against a backdrop of great public scrutiny and a recovering economy, the function has played a key role in the successful achievement of Lloyds’ overall business goals. Under the banner of ‘Simplification Sourcing’, a procurement programme was developed with the aims of reducing cost to the bank and improving the overall capability of the procurement function.

The function achieved their goals, but also put measures in place to ensure that the changes and processes would be sustainable in the future. Last year, the team was recognised with the CIPS Award for the ‘Most Improved Procurement Function’.

Andy Collopy, Operations and Property Sourcing Director, talks to Procurious about what the award means for The Group Sourcing team within Lloyds and what’s next for the function.

How did you get started in procurement?

It’s the old cliché but I kind of fell into Procurement back in 1996 as part of an organisational change. I moved from a Logistics role into Procurement and have never looked back. I remember the conversation as if it were yesterday – “We are removing a layer of management in Logistics, Andy, so your job has gone. We think you would be good at Procurement. Do you want to give it a go?” The rest, as they say, is history.

Procurement hooked me in from day 1 when I completed my first deal, negotiating the new pallet contract. I soon realised the power of Procurement when I saved the company more money in an afternoon’s intensive negotiation than I had in 2 years in Logistics through incremental efficiency.

What prompted you to submit a nomination for the award?

The main reason was that the timing was right.

Lloyds embarked upon a Simplification journey in 2011, which ran until the end of 2014 (we are now in Simplification 2 – the sequel!). We felt as though we had achieved a great deal in the 3-year programme, and getting recognition for this from external sources, as well as from our internal stakeholders, was an important part of recognising our achievements.

I have always been a fan of the CIPS/Supply Management awards since I was part of the GSK team that won the Best Use of Technology award back in 2003. I also had the honour of being on the judging panel in 2009, and saw all the hard work that went into both the submissions and judging. I was keen for us to compete against the best.

The CIPS/Supply Management awards evening is always a great evening too, to recognise great work that the function does and catch up with old colleagues.

What is the ‘Simplification Sourcing’ programme?

Simplification Sourcing was the brand name for the programme. There were 9 key elements to the Transformation programme:

  • Vision & Strategy – Set out the 3yr strategy for Group Sourcing as part of the overarching bank strategy to be “Best Bank for Customers” and “Helping Britain Prosper”
  • Internal Client Management – Ensure that everything we do in Group Sourcing is closely linked with our internal clients’ goals and objectives through strong relationship management, with financial benefits interlocked into the Business Units P&L
  • Business Sourcing Process – Execute sourcing activity through an integrated process that starts with business needs, marries this with the supply market capability to deliver an optimal outcome for the bank in terms of competitive advantage, risk management and responsible business
  • Supplier Management – Apply segmentation to effectively manage all our suppliers from a basic risk and conduct assurance perspective, as well as work with our strategic suppliers to deliver value beyond the basic contractual terms
  • Contracts & Legal – Working seamlessly with Legal to deliver an end to end contracting process that ensures correct terms are used, negotiated and stored
  • Sourcing Transactions – Enabling the “Right Way to Buy” through user friendly Requisition to Pay processes and compliance management
  • Risk & Quality Assurance – In an increasingly regulatory environment, providing control on all aspects of Procurement from basic supplier assurance to checking the quality output of sourcing plans and supplier management rigour
  • People – Building human capability through tailored learning & development programmes, as well as key talent management and succession planning
  • Change Management and Communications – Embedding sustainable change through a co-ordinated change and communications programme to ensure that key messages and deliverables land with colleagues, stakeholders and suppliers

Has it lead to greater collaboration between procurement and the rest of the business?

Definitely. I do think that we had a real need in Lloyds to change the bank, both in terms of how we serve our customers, as well as fundamentally restructuring the cost profile of the bank. This sense of purpose galvanised people around a common goal, and Group Sourcing under Michael Whitby’s stewardship seized this opportunity to play a pivotal role in the future success of the Group.

The past 3 years has elevated effective third party spend management to being one of the key levers in the bank’s forward success. We find now that we have created the ‘pull’ factor with our stakeholders, as they understand what we can do for them. Our aim now is to keep this momentum and build upon it.

What was the most critical part of the plan for procurement?

Given the need to fundamentally restructure the cost profile of the bank, a key element of the plan was to deliver significant savings in the third party spend profile. Group Sourcing achieved £560m savings over the 3-year period. The key part of this was the interlock with the business’ bottom line, which saw a 16 per cent reduction in the Group’s cost base over the period, which was a key commitment given by the bank to the City back in 2011.

This achievement should not be under-estimated, given that in many organisations I have worked in; Procurement struggles to justify its savings to key stakeholders such as Finance. This is not the case at Lloyds. This credibility has created the space to allow Group Sourcing to start to influence the wider agenda of the Group.

How have you ensured that the success you have had is sustainable?

A key part of the programme delivery was to ensure that what was created was enduring. From a process perspective, we achieved this through robust change management at the time and built the key infrastructure to be able to monitor progress moving forward and address any potential deterioration. Performance Dashboards exist for all the main elements of the sourcing process e.g. contracts, supplier management.

The more challenging element has been embedding cultural change with our colleagues in Group Sourcing. Behavioural change is a key challenge in any organisation from my experience and it takes time.

In developing the capability of the team to meet the targets we set ourselves, we have focussed on the softer skills of influencing, engagement, relationship management and authentic leadership, as well as the traditional elements such as negotiation and effective project management. This work is never done however we have seen a step change in a number of our colleagues over the past 3 years, which has been great to see.

What’s next for the function?

A good rest! No, only joking. As I mentioned earlier, as we closed out our successful Simplification 1 programme at the end of 2014, we quickly ramped up for Simplification 2. Some of this involves sustaining what we achieved in Simplification 1, but we are also looking at new elements.

While Lloyds has always focussed on its customers, our intensity to get this right under our key aim, which is to become the “Best Bank for Customers”, means that we are increasingly looking at how to achieve this. Procurement is beginning to play a key role here, bringing market insight from our strategic suppliers to the Group to stay ahead of the competition.

This can be seen in a number of ways such as suppliers helping Lloyds re-design its processes from a customer perspective i.e. end to end customer journeys, to bringing new and innovative ideas to the Group to support the ever growing Digital Banking agenda.

Where do you see the future of the profession as a whole and how can social media play a role?

This is a really interesting question. I often read articles that say Procurement won’t exist in 10yrs time as a distinct function, or category management is as strong as it ever was. My sense is that being in a position to leverage the market, and blending this with stakeholder intimacy is the most effective formula.

Third party spend continues to grow as a percentage of the overall cost base of most corporations, so the need for effective Procurement will not go away. So we are in a good place in my opinion.

I sometimes have interesting conversations with senior stakeholders, where they are willing Procurement to take the lead, yet often see reticence from the function. My view is we need to be more confident in our capability as I was all those years ago in that first pallet deal!

In terms of social media, Procurement is a laggard here. I do think that we need to up our game and embrace this medium, especially with our suppliers. This area has so much potential, and we need to push our technology partners to come up with innovative ways to interface with suppliers in both an open and confidential way, given the nature of what we do.

For more on the CIPS Supply Management Awards, and the Procurious Knowledge Partnership with CIPS, visit our website

Regulation, relationships and waste leave a nasty taste in the mouth

All facets of the food supply chain came under scrutiny this week, but all for very different reasons. From relationships with suppliers to a sustainable way of cutting down on food waste, the supply chain that impacts us all is working hard to stay ahead of the game.

Conservative estimates put weekly food spend for families in the UK at £58.80, making for approximately £3,050 per year. In the USA, the figure is an average of $127 per week ($6,602 per year). However, it could be argued we could all do with taking a keener interest in where our food is coming from.

The often-cited examples of the Tesco horse meat scandal, the Nanna’s berry re-call in Australia and the potential large-scale issue of undeclared peanut use have all highlighted that organisations need a greater focus throughout their supply chains.

Poultry Supply Chain

New measures have been announced by a number of UK retailers to reduce campylobacter levels in chickens.

Between February 2014 and February 2015, the Food Standards Agency (FSA), found that nearly three-quarters of all chickens tested positive for the campylobacter. For those of you who are unfamiliar with this particular parasite, it’s the biggest cause of food poisoning in the UK.

In light of this, UK retailers have begun working with supply chains to reduce instances of the bug. Measures include rapid surface chilling, on-farm testing, new scientific research and the sharing of best practice, all aimed at increasing the levels of biosafety and reducing infection rates.

Supply Chain Exploitation

A recent report in Australia has highlighted ‘slave-like’ conditions in the food supply chains of some of the country’s biggest retailers. Four Corners, a ABC network programme, found that the biggest culprits were some labour hire contractors, using migrant workers with expired or invalid work visas.

It is widely believed that these practices are linked to supermarkets’ ‘race to the bottom’ on pricing. Increasing price pressures have lead to other companies in the supply chains looking at alternative methods to bring costs down.

Supply Chain Practices

Unethical practices and organisational responsibility have been pinpointed in a new report published regarding Wal-Mart’s supply chain. In the report, the Food Chain Workers Alliance (FCWA) alleges that Wal-Mart has not made good on promises to improve labour and ethical standards in its supply chain.

The report also details a number of violations of Wal-Mart’s own sourcing code of ethics in relation to workers, environmental impact and treatment of animals. Although Wal-Mart has yet to respond to the report, it is hoped that it may compel the retail giant to make changes to its supply chain.

Relationships and Regulations

Many of these issues can be traced back to the importance of having good relationships in the supply chain. At the British Meat Processors Association annual conference last week, BMPA president Peter Mitchell, argued that good supply chains are vital to the success of the meat industry.

Mitchell also argued that closer relationships with the FSA and UK government departments, as well as tighter regulations, were vital to the future of the meat supply chain.

Malcolm Johnstone, president of the Food Storage & Distribution Federation, also cited regulations in relation to meeting the exacting standards of the UK food industry. He called on the members of the Federation find new ways of managing facilities in line with regulations to increase efficiencies and keep pace with the market.

Food Waste

And finally, to finish on a positive note, Tesco have been in the news for good reasons as they announced new measure to combat the volume of food waste its stores produce.

A partnership with Fareshare, a food distribution charity, will link Tesco to local charities in order to hand over some of the estimated 30,000 tonnes of wasted food. Initially this will cover 10 stores, but Dave Lewis, Tesco CEO, hopes to roll this out across the UK and in other countries where Tesco operates.

The company is also backing proposed legislation in the UK to ban supermarkets from throwing away food that is approaching its best-before date, instead giving it to charities.

Do any of you work in the food supply chain? Do you have any examples of good practices that could be shared? Get in touch with Procurious and let us know.

Meanwhile, here are some of the procurement and supply chain headlines from this week.

Amazon Just Changed Its Iconic Shipping Boxes

  • As reported by Time magazine, Amazon now gets the honour of reportedly being the first company to use its packaging to advertise an un-related product. This marks the first time Amazon has allowed a third party to feature on its delivery material, reports the LA Times.
  • The company is rolling out ads on its delivery boxes in bright yellow to boost the new Minions movie from the Despicable Me franchise.
  • Boxes began being sent to customers last week. There are three different types of ads.There’s also a link on the box to a Minions page on the e-commerce site.
  •  While Amazon has used its packaging in the past to market its own products, this is the first time that it has done so for a non-Amazon product.

Read more at SupplyChain247

Cath Kidston promotes supply chain director to COO role

  • Cath Kidston has promoted its director of global supply chain and product development, Geert Peeters, to the role of chief operating officer.
  • The move comes after what the home furnishings and fashion brand described as “three successful years” of managing the business’s global supply chain.
  • Peeters’ supply chain career to date spans more than 25 years, and he has previously held senior roles at the likes of Levi’s, Bacardi and VF Corporation.
  • Commenting on his promotion, Cath Kidston CEO Kenny Wilson said: “I am very pleased to be recognising the significant contributions that Geert has made in helping Cath Kidston grow to where it is today.

Read more at Essential Retail

Shadow banking boom pushes China to edge of debt sustainability

  • Booming shadow banking growth has pushed China to the outer limits of its ability to service debt and keep its economy functioning smoothly, though spillover risks from a bursting of the credit bubble are containable, experts said on Monday.
  • With total leverage in the Chinese economy now topping 280 per cent of gross domestic product, it was clear that credit quality was deteriorating, Primavera Capital Group founder and chairman Fred Hu told delegates at a Fung Global Institute forum. “It is not yet the end of the world, but it is approaching the limit of debt sustainability,” Hu said.
  • Debt sustainability, the ability to service debts, is a key measure of solvency. Analysis by the McKinsey Global Institute earlier this year showed debt in the Chinese economy had roughly quadrupled between 2007 and the middle of last year to US$28 trillion, leaving it with a debt-to-GDP ratio more than twice that of crisis-wracked Greece.

Read more at South China Morning Post

The case for exempting projects from open procurement

An opinion piece from Public Finance.co.uk says that the proposed Garden Bridge across the Thames is an object lesson in how political initiatives can rub up against technocratic process. Reforming EU procurement legislation could allow big ideas to bloom.

It continues: Open and transparent procurement is an important defence against corruption, kickbacks and simple waste, but the European regulations set technocratic process against political accountability.  Mayors and other politicians will be approached with bright ideas from time to time. Surely they should have political space to judge how bright these are, and to implement them, subject to safeguards and controls – not least, the electorate’s ability to eject politicians who pursue vanity projects?

Read more at Public Finance

G7 leaders urge tough line on Russia at Alpine summit

  • Group of Seven (G7) leaders vowed at a summit in the Bavarian Alps on Sunday to keep sanctions against Russia in place until President Vladimir Putin and Moscow-backed separatists fully implement the terms of a peace deal for Ukraine.
  • The Ukraine conflict and a long-running debt standoff between Greece and its European partners dominated the first day of the annual meeting hosted by Chancellor Angela Merkel at Schloss Elmau, a luxury Alpine hotel in southern Germany.
  • Merkel is hoping to secure commitments from her G7 guests to tackle global warming ahead of a major United Nations climate summit in Paris in December.

Read more at Reuters

The Devastating Effect of Unsustainable Palm Oil

Palm oil is one of the most widely used products in the world, but its increasing demand has led to large-scale, unsustainable plantations, causing devastation to large parts of growing countries. Indonesia is one such place.

Earlier this year, Jordan Early wrote an article for Procurious in which he asked whether or not it would be possible to get to the stage where all palm oil would be produced sustainably.

Jordan cited the example of PepsiCo, one of the high-profile organisations using palm oil in a number of its products, and Sum of Us, who were highlighting the potential unsustainability in the PepsiCo supply chain. PepsiCo have since stated that they are working towards sustainability, but other large organisations are lagging behind.

This got me thinking, not about criticism or finger pointing, but education on this subject for procurement professionals. So that’s what I’ve decided to do here.

The Product

Palm oil comes from the oil palm tree, a crop that is grown exclusively in the Tropics. What makes it a popular crop to grow is the high yields it produces in comparison to other vegetable oils and the lower cost to growers.

While the oil’s most common use is as a cooking oil in developing countries, it is also used in a number of household products – from lipstick and soap to detergents and even ice cream. Increasing demand has led to increasing global production, with plantations spreading across Asia, Africa and Latin America.

Replanting with oil palm trees is a good option for many farmers and landowners, not only because of the higher yields, but also due to incentives offered for producing the crop for export. The Indonesian Government has been reported in the past as offering tax incentives and interest rate subsidies.

Effects of Unsustainable Growth

However, this growth has also led to unethical practices, creation of an unhealthy monoculture in some countries and widespread deforestation, leading to loss of habitat for a number of endangered animals, as well as land and livelihoods for indigenous and local populations.

It has been reported recently in Indonesia that thousands of hectares of peatland are under threat, due to companies clearing the land for oil palm plantations. The deforestation has polluted local water supplies and the situation is likely to worsen when the companies burn the ground to reduce the soil acidity before planting the oil palms.

In addition, local villages that have relied on the peatland for a source of water in dry seasons and a livelihood are struggling and face the prospect of being moved on from their home.

Part of the issue comes from a lack of strong regulation when it comes to licenses and permits for plantations. It’s felt by many in Indonesia that new regulations need to be issued by President Joko Widodo, as current ones offer no legal consequences for contravention.

Changes to be made

In spite of all this, it’s hard to argue against the idea that palm oil has had a positive effect on the economies of countries it is grown in, particularly when planting has been conducted in a sustainable fashion.

In 2008, as the demand for palm oil increased steadily, Indonesia exported $14.5bn worth of palm oil products. The country has also seen more than $20bn worth of investment from banks and financial institutions since 2008.

And there appears to be a change happening at an organisational level too, with Wilmar International, the world’s largest trader of palm oil, announced a ‘No Deforestation, No Peat land, No Exploitation policy’ – a move that many hope will encourage other traders and refiners to follow suit.

The Role of Procurement

As with many aspects of sustainability and ethics, the role of procurement is to ensure that supply chain practices are conducted at the required high standard. For palm oil production, it is about ensuring that strong practice around sustainability, including deforestation and ethical issues such as the treatment of local populations, are fully enforced with all suppliers.

It is a matter of both organisational and personal responsibility to ensure the practices and behaviours are correct. Consider taking the CIPS Ethics Test on an individual basis and opening dialogue with your suppliers to ensure that they understand what your organisation expects.

There may also be events in your region you can attend, similar to this one at the Melbourne Law School, which look to generate discussion on topics like regulation of the palm oil industry and what can be done to help countries like Indonesia.

If you are interested (and a procurement professional in Asia), you can contribute to a new book that is due to be published next year. Sustainability in the Asia Pacific’ intends to open the discussion of ‘pragmatic perspectives’ in sustainability accounting to support corporate decision makers in improving corporate sustainability management practices. Check out the website to see how to contribute.

Do you source products containing palm oil? Have you seen any good you can share? Or bad practice and how you dealt with it? We’d love to hear from you and get a dialogue going in this area.

I’d like to thank Dominic Gray for helping me with my understanding of this topic and providing sources of information.

5 Things Procurement Organisations Should Start Doing Now

By Kay Ree Lee, The Hackett Group 

Stop paying lip-service to your internal customers: Here are five things Procurement organisations should start doing now to meet and exceed internal customer requirements.

“Procurement needs to be more proactive versus the Business initiating projects”

“Procurement needs to be an integral part of the team”

“Consult the Business before implementing any process improvement”

“Procurement needs to issue the POs in a timely manner. Waiting 3 days on a PO is unacceptable”

These are some comments we’ve recently heard when conducting a Stakeholder Survey (Voice of the Customer) as part of a broader Procurement benchmark for different clients. We often hear that Procurement is focused on meeting and exceeding customer requirements, but benchmarks from Hackett’s Procurement database shows otherwise.

The chart below shares that 30 per cent of Non-World-Class (Non-WC) organisations rated Procurement as an Administrator while only 15 per cent of Non-WC organisations rated Procurement as a Valued Business Partner. So, if this is the stakeholder’s perception of the Procurement organisation, what are some things you can do quickly to change this perception?

What is the Current role of Procurement in supporting business success in your area?

Other than changes to the organisation structure, there are five things that we believe Procurement can quickly do to improve internal customer perception and exceed internal customer requirements:

  1. All Procurement resources should be customer focused and empowered
  2. Dedicate specific Procurement resources to Help Desk activities
  3. Start conducting monthly training to educate internal customers
  4. Create a monthly/quarterly newsletter and share recent projects, success stories and upcoming projects
  5. Create an internal website to share Procurement information: FAQs, contact information, approved suppliers, success stories, process documents, etc.

1. All Procurement resources should be customer focused and empowered

We often hear the comment that perception is reality – unfortunately, there is some truth in this. As Procurement resources are typically focused on assisting end-users with different processes in Procurement, all Procurement individuals (whether they are internal client-facing or not) should be customer focused which means being helpful in problem solving and troubleshooting, being proactive, being a good listener, and feeling empowered to fix processes that are broken.

The term ‘fit-for-purpose’ or ‘fit-for-risk’ comes to mind when addressing broken processes. As Procurement works to address issues identified by its internal customers, it should determine whether the process is adequate or overkill for what the internal customer is trying to accomplish based on the value and appropriate risk appetite of the organisation.

2. Dedicate specific Procurement resources to Help Desk activities

Procurement activities are a complex string of processes. As such, we should expect our internal customers to have plenty of questions related to the process, status of transactions, etc. Dedicating specific Procurement resources to answer questions from internal customers is one of many ways Procurement can help address and resolve questions in a timely fashion. However, it is important to note that the more knowledge the Help Desk resources have about the usage of Procurement technology, status of sourcing events, process for sourcing, and a broad understanding of Procurement, the better they will be at being able to provide first-contact resolution.

3. Start conducting monthly training to educate internal customers.

Conducting monthly/ongoing training to internal customers will help provide them with the knowledge and latest information to perform their jobs. Ultimately, this will also help Procurement. There are various types of training that can be provided to include:

  • How to create transactions
  • How to create spend analysis reports
  • How to identify approved suppliers
  • How to use e-catalogs
  • How to manoeuvre the ERP maze

During these sessions, it would also be helpful to document the various issues that each of the internal customers faces. By addressing these issues, Procurement will be able to 1) ensure that internal customer requirements are met and 2) improve internal processes.

4. Create a monthly/quarterly newsletter and share recent projects, success stories and upcoming projects

Most of Procurement’s work goes behind the scenes and rarely do we share our success stories for one reason or another. However, creating a monthly/quarterly newsletter will help provide our Internal Customers with additional information on how the Procurement organisation is able to assist, help identify new projects and bring to light creative ideas from previous projects. In addition, it is also a way of demonstrating value that Procurement organisations bring along with some shameless self-promotion.

5. Create an internal website

While the monthly newsletter is focused on sharing the latest news, an internal website is another way of allowing our Internal Customers to perform self-service. There are various reasons to create an internal website including:

  • Sharing of information with our internal customers
  • Providing them a portal to log issues
  • Providing them ability to self-diagnose and resolve issues

As a member of the Procurement organisation, our role is to help support internal customers by listening, understanding, meeting and exceeding their expectations. Being front and center to our internal customers is important. Hopefully, these 5 activities can quickly help your Procurement organisation change your internal customers’ perception.

Tania Seary: The Business Case For Creating A Procurement Network

“But sometimes I worry that large portions of the procurement profession are uncontacted…”

Watch our fifth Big Ideas Summit keynote (part 1 of 3)

Watch Tania’s keynote in FULL here

Tania Seary, founder of Procurious, started off with an statistic that there are 27 indigenous tribes in the Amazon region that are entirely disconnected from the rest of the world, comparing that to the often isolated procurement profession.

Tania looked at the impact of social media on the profession, and how it can help to create the community for procurement to allow us to work together, solve problems and ultimately create value for businesses. One of these platforms is Procurious.

Procurious members can find Tania’s full keynote here. Not a member yet? Register for free.

Watch: See more Big Ideas from our 40 influencers