All posts by Stephen Ashcroft

Why Is a Project Procurement Strategy Absolutely Necessary?

An effective project procurement strategy is based upon a shared understanding of the role and purpose for the procurement process.

Project Procurement

Frequently, there are different perceptions of this at senior management, project management, end-user, and supplier levels.

A shared focus needs to be built upon an alignment of perceptions and understanding around what the project requires from a well performing procurement process, which is consistent with the agreed aims and objectives.

A procurement strategy that is successfully integrated, and implemented, within the Project’s cascade of objectives and performance measures, is recognisable by the following five characteristics:

  1. Clear “buy-in” from senior and broader project stakeholders to the benefits of embracing an agreed role and purpose for the procurement process, and how people need to interact to ensure that outcomes are achieved in a satisfactory manner.
  2. Competent, professional commercial people playing a key role in the process, at the right interaction points, to ensure delivery of clear solutions from supply markets that meet project needs.
  3. Key suppliers and contractors who treat the project as genuine ‘preferred customers’.
  4. Processes, systems, measures and enabling structures that support delivery capability along the entire procurement process cycle.
  5. Capacity and capability that’s available at the right pressure points.

Setting out the Objectives, Goals and Guiding Principles

Strategy documents need to outline two key facets — the objectives of the strategy, and the goals which are necessary to achieve these objectives.

The goals describe what will actually happen, and objectives describe what will be achieved as a result. The guiding principles reflect the core values on which the strategy is based, and which will inform all the actions which are planned as a result.

Procurement will:

  • be transparent;
  • be driven by desired results;
  • create the most economically advantageous balance of quality and cost;
  • reduce the burden on administrative and monitoring resources;
  • lead to simplified or routine transactions;
  • encourage open and fair competition; and
  • follow all appropriate regulations and legislation.

These values in turn translate into key performance indicators that can be used to assess the quality of results.

Setting the Objectives 

There’s no short, definitive list of subjects to include in procurement strategy objectives. Priorities change over time – strategies need to be reviewed and revised to reflect changes in circumstance and focus.

Subjects to consider include:

  • Operating Structure – is it fit for role and purpose, influencing where it should and as it should in a devolved environment? Do end users know what’s available to them by way of contract access and the procedures that they must follow, and are these procedures benchmarked against best practice, reviewed and updated as required? Is there clear project leadership of the procurement process?
  • Expenditure Analysis – is project expenditure on bought-in goods and services analysed in such a way that amounts spent, with whom, on what, and by whom, are understood, under control and spent optimally?
  • Maximising Value – how is it intended to maximise value through procurement activity, the use of competitive tendering and established collaborative contracts, and the deployment of procurement professionals?
  • Supplier Strategy – does the project have a strategy for dealing with suppliers and markets, such as buying local and compliance with relevant Regulations? Is there available guidance to suppliers on elements of the procurement policies (sustainability, SMEs etc, key contacts and signposts), and core values?
  • Social Responsibility – how does the project plan to take account of its social, economic and environmental responsibilities through procurement e.g. sustainability, health, safety and welfare, environmental management, equality, ethical procurement, working with the local business and social communities?
  • The Use of Procurement Tools – is there a strategy for operating the most appropriate, efficient and effective Purchase to Pay systems and procedures including use of procurement cards, e-tendering, e-auctions and an e-procurement platform and are the benefits of such use – reporting, planning, measurement and cost control – clearly explained and understood?
  • Supplier/Contract Management – are key suppliers identified and, if so, who are they and why are they key? What is the Project approach to supplier and contract management and what are the plans for monitoring supplier performance and managing improvements?
  • Performance Reporting – are there mechanisms/indicators in place whereby performance monitoring within the procurement process is routinely reported to senior management? Do such mechanisms include benefits and savings reports, customer and supplier feedback on the effectiveness of procurement performance?
  • Risk Management – are key risks and dependencies relating to procurement process, legislative and regulatory non-compliance identified, understood, monitored and appropriately communicated across the Project?

ACTION: develop and adopt a clearly documented procurement strategy in terms of measurable and managed contributions to the achievement of procurement, and ultimately Project, objectives.

Stephen Ashcroft BEng MSc MCIPS is a procurement learner stuck in the body of a procurement veteran, and with over 20 years’ experience still sees the glass as half full. Check out this article, and more, on ThinkProcure.

5 Crippling Beliefs Keeping Suppliers in the Poor House

Suppliers may feel they don’t get treated fairly in the procurement process. But are there actions they could take to attract procurement’s attention?

Customers and Suppliers

This article was first published on LinkedIn.

Before the jackpot of the internet, purchase research involved, for me, accessing supplier directories such as Kompass (who are still going strong), putting up with pesky sales reps with inadequate brochures extolling the virtues of their products/services, trawling exhibitions, and leaning on colleagues and contacts.

Now, not so much. Although I’m still leaning on colleagues and contacts!

A while back I was involved in putting together a Preferred Supplier List for a bunch of equipment spend categories. The starting point was finding ‘someone’ to research suppliers online globally.

Here’s what drove me bananas as I tried to collate a long list of suppliers to invite to enter a procurement process:

1. A belief that ‘build it and they will come’.

Getting on that front page of Google is critical. Of course, I’m a professional and searched and searched pages. I was focused on finalising, quickly, my long list of ten or twenty suppliers, per category. Those early pages were my key hunting ground.

2. A belief that the lingua franca of international business is [insert local language].

Are you wanting to sell your goods internationally? Language content options are a must have. I’m being open. If there wasn’t an English option I moved on. Maybe a missed opportunity for me – and definitely a missed opportunity for an aspiring supplier.

3. A belief that website content full of fancy jargon and TLAs* will get the sale.

Tell me in ten words or less what you offer and who you help. Right up front on your first page – front and centre. I’m happy to take a deep dive into the details later on my ‘journey’, but for now I just want assurance you sell the category of equipment I’m interested in.

4. A belief that it’s all about social media engagement.

Contact details – your phone number and email. Please. Everywhere, every page, very visible, consistent and definitely including an email address, which, ideally, is a local market email addresses that doesn’t say [email protected] Make it as easy as possible for people to contact you directly.

By the way, thrilled with all those Instagram and Pinterest and other social media followers – how’s that working out for you? And while I’m here, are we absolutely sure about that contact form? I can see why YOU want my name, role, company, email, phone number, I’m just not so sure what’s in it for me.

5. A belief that having a unique, quirky website design will really drive business.

Let’s talk website design, which is not my thing. I’m just a victim of it from firms all over the world. When I’m buying internationally for a major client, I don’t want quirky (ok, maybe I’ll be accommodating if I’m buying creative services or wanting local supply chain).

Mainly, I’m craving surety that this website reflects an international supplier. Give me a nice clean corporate-looking website – make me feel comfortable and open to trusting you.

Am I asking for too much? Really? Please note, this is not an exhaustive list!

Action: Go have a look at your website, right now, and see if the 5 beliefs stand scrutiny. Your website is (probably) the first contact for your target customers – make it easy for them.

After all, you don’t want to end up in the poor house.

*TLAs = three letter acronyms; in fairness, Procurement’s not short of them either!

The 99 Names You Can Call a Procurement Professional

And can you guess why #30 is my favourite?

buyer_personas

This article was first published on LinkedIn.

It would appear (some) people in Procurement are very sensitive about their job title!

So, what’s the difference between job titles?

Not a lot by the looks of it; call yourself what you want when you want! No doubt, with many, it is an image issue. With others it’s trying to capture the essence of the job.

The fascination is the likely impact on non-procurement people who must be confused about the nature of the procurement role. Some see it as an administrative role, not engaged in any policy or strategic decisions. Others see it doing what Procurement is told to do by others who can select suppliers, negotiate and deal with contracts far better than Procurement.

A Definitive Answer

If you are looking for a definitive answer as to what to call a Buyer you will be seriously disappointed.

There isn’t one.

I’ve been doing research into job titles for a project we’re involved with – and checked our client database and a quick google – and came up with these 99 different titles. Proliferation is the word, or perhaps obfuscation (an increase in the muddying of the waters – did you see what I did there?).

You might see why I like #30 so much ;)!

Set out below is a range of job titles used by Procurement professionals. As you’ll see there’s no commonality in them and they may clash with role descriptions other employees have who have nothing at all to do with Procurement. If you’ve come across any other Procurement job titles, let me know or add them in the comments.

That’s if you can get through the 99 here…

  1. Head of Procurement
  2. Chief Procurement Officer
  3. Head of Category
  4. Procurement Director
  5. Resourcing Director
  6. Category Acquisition Director
  7. Procurement Lead
  8. Resourcing Lead
  9. Category Acquisition Lead
  10. Procurement Partner
  11. Resourcing Partner
  12. Category Partner
  13. Category Sourcing Lead
  14. Category Sourcing Partner
  15. Procurement Manager
  16. Resourcing Manager
  17. Category Acquisition Manager
  18. Sourcing Manager
  19. Category Sourcing Manager
  20. Strategic Procurement Lead
  21. Head of Procurement Operations
  22. Head of Procurement Strategy
  23. Chief Category Officer
  24. Sourcing Specialist
  25. Resourcing Specialist
  26. Procurement Specialist
  27. Procurement Operations Manager
  28. Head of Procurement Projects
  29. Vendor Manager – Procurement
  30. Buyer
  31. Senior Buyer
  32. Sourcer
  33. Principal Procurement Specialist
  34. Service Delivery Manager
  35. Procurement Business Partner
  36. Resourcing Business Partner
  37. Procurement Consultant
  38. Executive Buyer
  39. Executive Procurement Manager
  40. Manager – Procurement
  41. Executive Category Sourcing Manager
  42. EMEA Executive Sourcing Leader
  43. Global Program Manager – Employer Branding
  44. Principal Delivery Consultant
  45. Strategic Procurement Manager
  46. Resourcing Advisor
  47. Sourcing Advisor
  48. Category Acquisition Advisor
  49. Lead Buyer
  50. Head of Projects – Category Acquisition
  51. Procurement Marketing Manager
  52. Resource Consultant
  53. Graduate Buyer
  54. Procurement Advisor
  55. Programme Manager
  56. Programme Lead
  57. Manager – Category Systems
  58. Internal Buyer
  59. In-house Buyer
  60. Global Category Selection Manager
  61. Corporate Buyer
  62. Technical Buyer
  63. Corporate Procurement Lead
  64. Technical Procurement Lead
  65. Category Buyer
  66. Lead Sourcing Consultant
  67. Executive Category Acquisition
  68. HR Manager – Procurement
  69. Lateral Buyer
  70. Lateral Procurement Manager
  71. Deputy Head of Procurement
  72. Director – Executive Procurement
  73. HR Purchasing Specialist
  74. University Purchasing Consultant
  75. Hybrid Buyer
  76. Direct Buyer
  77. Indirects Buyer
  78. Direct Procurement Specialist
  79. Category Sourcing Lead
  80. Category Scout
  81. Relationship Manager
  82. Director – Strategic Resourcing
  83. Category Identification Manager
  84. Procurement Strategy & Planning Manager
  85. Procurement Team Lead
  86. Procurement Team Leader
  87. Supplier Relationship Manager
  88. Category Attraction Consultant
  89. Procurement Officer
  90. Procurement Consultant
  91. Category Specialist
  92. Category Consultant – Executive Search
  93. Procurement Agent
  94. Procurement Executive
  95. Procurement & Engagement Manager
  96. Project Purchaser
  97. Category Attraction Specialist
  98. Lead Category Scout
  99. Resourcing Associate

If you think I’ve missed any of your favourites (and no doubt I have), please let me know in the comments – it would be good to grow the list and get your view.  Always learning!