Category Archives: Career Management

Stakeholders Are Your Customers. Ignore Them At Your Peril

If you fail to meet the expectations of key influencers, projects will be delayed, will only be partially workable or at worst, doomed.

Stakeholders can and will influence the outcome of your project, especially if they are likely to be directly affected by it. If we fail to meet the expectations of key influencers, projects will be delayed, will only be partially workable or at worst, doomed.  

Who are your stakeholders?

Stakeholders are any of those individuals that can impact your activities by:

  • removing obstacles and championing  your goals
  • by slowing down or blocking your activities  
  • influencing others about your project –positively or negatively

Many of your stakeholders may not initially be obvious.   They can be:

  • End-users of the product or service
  • Line managers, executives and support staff
  • Procurement team members and co-opted subject matter experts 
  • Suppliers and their subcontractors
  • Government agencies and the media
  • Customers and society at large

Why is stakeholder management so difficult?

Stakeholders have conflicting priorities and often are not working towards the same goal. Personal ambitions may trump the company vision.  You may be the messenger bearing bad news or saying no to their proposals. Seasoned procurement people use their persuasive skills to win support from stakeholders.  This can be the difference between success and failure.

Because stakeholders will change over time, we need a systematic approach to identify and prioritize those influencers.  A stakeholder map is a simple analysis tool we can use to identify which key people have to be won over.

A simple shareholder map

This map provides a guideline on how to manage stakeholders based on their interest and their influence:

Figure 1   The stakeholder analysis grid

The Greens

Stakeholders with a high level of influence in your specific project and who also have a high level of commitment and support must attract the most focus.   They are usually easily identified and are easy to engage. They usually include line managers and end-users.  Ensure you continue to maintain their support through good communication and monitoring their needs. These people can be used to influence others.

The Oranges

This is an important group to manage and may include senior management, e.g. CEO or GM. Keep them satisfied.   Increasing their interest or commitment to your project through regular updates can be very helpful.

The Browns

These customers are your supporters. Keep them informed, their enthusiasm may be infectious and they may have more influence in the future.  Less time is needed to maintain this group. 

The Purples

External stakeholders such as the media and government may fall into this group so it is not necessary to spend too much time there. But keep them in the loop and monitor them as they may move into another group!

Identify all key stakeholders and plot them in the grid in Figure 1. 

Steps to follow to ensure success of any initiative:

  • Concentrate your time on working with key stakeholders who can make or break the initiative. Make sure every stakeholder has an appropriate way to participate and offer input.
  • Understand and manage their expectations. Identify any potential adversaries early in the process and manage them directly by allocating key tasks to them. Persuade those people who may not be immediately supportive. 
  • Under-promise and over-deliver.  Think like a salesperson.
  • Keep everyone well-informed and build strong relationships with the people who support the project.  Recognise and reward positive behaviours to preserve the relationship and buy continued support. 

Dealing with difficult stakeholders

The first step is to clearly identify those stakeholders and work out what motivates them and what is causing their resistance. Ignoring difficult stakeholder behaviour is not recommended; take time to immediately identify the cause of their objections and the underlying issues. People want to feel understood and feel that their opinions matter.

Engage directly with the person directly without others present. This leads to more clear and calm conversations. Actively listen to what they have to say and don’t close communication channels because you don’t like what you hear.   Remain fair, objective, and professional, and remember to keep the project objectives within focus. Try to find common ground by asking open-ended questions.  

Why projects fail: communication is the key

Lack of frequent and accurate communication to and from stakeholders is probably one of the main reasons for the failure of projects.   Another is not listening to the needs and concerns of the key stakeholders, both internal and external. 

When to communicate with stakeholders

  • before the launch of a project to get buy-in. Early engagement is important.
  • at regular progress meetings held to keep everyone updated. Report back on progress (or lack of it) and milestones achieved.
  • before implementation to ensure alignment with the process and the proposed solution
  • at the end of a project to establish lessons learned

Stakeholder management is the process that we use to identify key stakeholders and win their support.  We use the analysis grid to prioritize them by influence and commitment. Understanding what motivates them is the first step to getting them on board.    

3 Ways To Make It Big In Procurement and Supply Chain

Tom Derry, CEO – ISM shares his three top tips for early-career professionals who aspire to be a CPO or Head of Supply Chain in a leading organisation.

The next generation of CPOs and Heads of Supply Chain will need to be “next-level” talent.

“It’s easy to point out a few critical success factors for people who have risen to the very top of the profession,” explains ISM CEO – Tom Derry.

In this article Tom shares his three top tips for early-career professionals who aspire to be a CPO or Head of Supply Chain in a leading organisation.

1. Align yourself with the best in the business

One of most important things to do during the early years of your career is to align yourself with the best talent out there. “If you’re just getting into the field or are early on in the field discover who has the best reputation, who’s the best leader and who’s regarded as being leading-edge and running a great organisation” Tom suggests. It’s also advisable look at the company’s reputation. “It’s clear that certain companies have created an awful lot of talent in our profession, disproportionately more talent to other companies.” So find those great leaders, at those great companies and that’s going to be a launching pad for you.”

2. Be courageous

“There are a lot of metrics of dubious value that we often pay attention to in the profession that have outlived their usefulness.” Tom says. He advises professionals to try and link what they’re doing day-to-day with what’s driving value for the firm – whether it’s bringing new products online, introducing new features to new products, driving top line revenue growth or increasing earnings per share by reducing cost. “Speak the language of the business and link explicitly what you’re doing to driving those kinds of outcomes.” This will help you to gain respect because that’s how we keep score in business and those are the measures that matter the most.”

3. Be competitive

“Businesses are about competition,” asserts Tom. “It’s about competition between firms but, frankly, it’s also about competition within the firm to gain resources to win the opportunities for promotion and advancement.” Tom believes it’s important to understand that you are competing, you’re being regarded by your superiors in the firm in terms of your output and your productivity. “You’re in a competition for advancement – maybe it’s advancement within the firm, maybe it’s advancement in another firm but you have to recognise that and put your game face on every day. As they say in sport: leave everything on the field. At the end of the day someone may outcompete you if you’re not taking that approach.”

Part Five of Tuesdays with Tom is available now. Click here to sign up and hear ISM CEO Tom Derry discuss top tips for aspirational early-career professionals, how high profile leaders can become talent magnets in supply management and the latest data on salaries.

Your Procurement Resolution: Don’t Settle For Best-In-Class

What better time to set and start tackling key objectives for 2019? Your new year’s resolution is to be better than best-in-class…

In this time of personal New Year’s resolutions, it seems appropriate for leaders to also consider a resolution for their departments. For Procurement leaders in particular there couldn’t be a better time to do so. In recent years, the function has made tremendous progress in transforming into a strategic value driver.

Yet, as leaders broadly acknowledge, this transformation journey still has a long way to go. A recent study by the Hackett Group found that only 63 per cent of procurement organisations have even developed a plan for digital transformation and 33 per cent bluntly stated their service does not meet customer expectations. A Forrester study on enabling smarter procurement found only 22 per cent believe their reporting and analysis is where it should be and only 22 per cent that they have the required agility to respond to changing requirements.

So what better time to set and start tackling key objectives for 2019?

My recommendation is to set an aspirational resolution that reflects procurement’s true potential. One that is distinct from your MBOs, which are likely based on continuous improvement of performance aimed at closing the gap with best-in-class.

The problem with best-in-class

There is nothing wrong with benchmarking yourself and striving to improve performance to match the best of your competition. Organisations should do so, especially if still early in their transformation journeys. Success will result in greater value to those organisations. But achieving best-in-class performance won’t result in procurement becoming truly strategic, and may actually hinder progress in the long term.

How is that so?

Look at it in the context of the World Cup (or the upcoming Superbowl). Every team in the tournament earned its spot by being the best in their region. Hence, each team can be said to be best-in-class. Yet only one is the champion and that team doesn’t win by playing at the same level as their best-in-class peers but by playing better, doing something critical differently. Best-in-class is not a competitive advantage in sports, nor in today’s increasingly winner-take-all market. It is a stepping stone on the path to true greatness.

If leaders are to build competitive advantage and truly drive strategic value, they have to think beyond best-in-class and view that as an interim objective on their transformation journeys. Leaders must ensure that the people and technology they embrace to navigate those journeys have the capability to take them the full way, and not become a constraint at some point.

Yes, your top competitors are doing this right now

What exactly does going beyond best-in-class entail? Is anyone actually doing this? Yes they are. Your top competitors are extending their competitive advantage even as you’re reading this. Below are just a couple of examples:

  • Revenue: A leading Telco leveraged the flexibility of our platform to create a private marketplace where suppliers can bid for used mobile phones in mass volumes, generating hundreds of millions of dollars each year
  • Innovation: In 2014 Meritor launched a three-year initiative to drive massive value by transforming their supply chain in what can be thought of as a drive to achieve best-in-class. They then followed that with a new initiative to unlock massive innovation through a unique approach to new product introductions, configuring our platform to their ideas. The result? Their stock price rose from $4.45 to $13.30 at the end of 2016 and much further since, far ahead of competitor growth.

Note that in both of these examples the teams implemented best-in-class processes and wanted quick value. It should never be a compromise. But they kept the ultimate objective in mind and brought on the right talent and technology to take them to the next level when ready.

The talent challenge

In any meeting with CPOs I have attended in recent years, the top pain point raised is attracting and retaining top talent. Talent that is up to the task of driving successful transformations, to best-in-class and beyond.

The above examples illustrate an important point about talent, and the symbiotic relationship with technology. What good is top talent if your systems are too rigid for them to bring their best ideas to life? Out of the box best practices are important, but that shouldn’t mean constraining yourself from doing a few strategic things differently.

Meritor has a great team with great ideas. So when deploying software, they took embedded best practices but ensured they had the flexibility to easily configure once they were ready for that next phase. This empowered them to realise a unique and innovative approach that supported their financial success.

Realise your true potential

So as we enter a new year, filled with endless challenges and opportunities I encourage you to set a procurement resolution. One that, if achieved, will set you on the path beyond best-in-class, to building a competitive advantage. One that will empower your talent to truly make procurement strategic and realise your true potential.

Don’t Let Your Action Bias Take Control Of Your Career

What is this motivating force that continually drives us? The answer could be – action bias.

Recently I found myself in unfamiliar territory; I had reached the bottom of the barrel. There was no big project to immediately sink my teeth into. I had achieved the unthinkable, I had achieved the workplace equivalent of clocking Facebook, there were no more stories to load.

Like any staffer worth their salt I was able to quickly fill that barrel back up but the level of discomfort that I felt stuck with me. It boarded on anxiety. I started pondering… what is this motivating force that continually drives me? The answer could be – action bias.

Action Bias

The term Action Bias comes from a 2007 study of penalty kicks in football “an analysis of penalty kicks shows that the optimal strategy for goalkeepers is to stay in the goal’s centre. Goalkeepers, however, almost always jump right or left. This implies that a goal scored yields worse feelings for the goalkeeper following inaction (staying in the centre) than following action (jumping), leading to a bias for action.”

A large part of my driving force within the workplace can be characterised by ambition, the desire to do a good job, to achieve outcomes, to deliver and “complete” but also to keep busy. It’s the last part that made me reflect.

Is keeping busy always a good thing?

We all have colleagues in the workplace that are constantly busy, the never ending flurry of shuffling papers, or the ghost colleague that is always in meetings and seemingly only comes back to the desk to sigh. Rationally we know that being busy doesn’t correlate directly to the quality or output of a person’s work but as a society we generally buy into the belief that being busy is a good thing.

The other recognisable “busy bee” is the creative thinker, the fire type, the fast paced ideas guy or gal. The negative association with these action orientated people is that they can shoot first and ask questions later, they jump to conclusions and engage in solution mode before deep analysis has taken place. While this is most certainly not a bad thing, it can be if done 100 per cent of time.

It could be proposed that the drive and motivation behind being busy is really just a societal acceptance of action bias.

So what happens when we stop? What happens when we take time to think?

What are the alternatives to being busy?

Looking at the items in the barrel, I realised that the new additions were improvements and value add’s and the bonus is that they are now captured in my work programme amongst the demand driven projects received directly from the business. The tendency towards action bias worked for me in this instance but I don’t think it should be my default.

Being busy can be characterised with a certain type of pace; moving fast and being stressed.

But, when you break it down being busy is about working towards a goal at a consistent pace that delivers the results you require. By reframing busyness in this way you can see the fast action and stress as a symptom of the belief system – be kinder to yourself. It is important to schedule time for strategic thinking and brainstorming that extends beyond the near future.

It is important to find time to think of new projects that deliver value to the business. It is important to think beyond the scope of “work” and perhaps the most shocking of all, it can be as simple as going for a walk and getting some fresh air.  Taking time to pause and go for a stroll in the sun is perhaps the most productive thing that we can do.

Best Of The Procurious Blog – Critical Factors When Selecting Your Suppliers

Procurement exists in a dynamic, fast-paced, constantly changing environment. So surely the reasons we use to select our suppliers and supply partners would change over time too? Wouldn’t they?

It’s been over three years since the Procurious network was canvassed on what critical factors they look for in their suppliers. The world has moved on a-pace in the intervening period and it’s interesting to take an inward look to see if procurement has developed at the same pace, particularly in its supplier selection processes.

Gone are the days of the cheapest price (or at least they should be!). Gone, and consigned to a very dark part of history, are the days where supply decisions were made over lunch or in private meetings, and related more to who you knew than what you knew, which golf course or members’ club you were part of. Or even (sharp intake of breath) what you might be offering the buyers in return.

Even the list below, the key factors highlighted last time out, may have been superseded. So what are the new criteria? Or, if they are still the same, why is this the case?

Cost and Quality vs. Social Value and #MeToo?

If we take a look back at the responses from the network in 2015, we find ourselves looking at a list with a number of the usual suspects on it:

  • Cultural Fit – including values
  • Cost – covering price, Total Cost of Opportunity/Ownership
  • Value – value for money and value generation opportunities
  • Experience in the market and current references
  • Flexibility
  • Response to change – in orders and products
  • Quality – covering products and service quality and quality history

In addition to this, some that didn’t make the top 7 as it was included trust and professionalism, strategic process alignment and technical ability. There’s nothing that looks out of place on the list. In fact, they’re all eminently sensible and fair criteria to be considering.

The problem is it that it reflects a very traditional view of procurement.

Given the changing environment that procurement operates in, wouldn’t we expect to see these criteria changing too? In the past couple of years, geo-political instability has dominated the landscape and shows no sign of disappearing soon with Brexit and a potential trade war between USA and the rest of the world just two examples.

But what about the other factors we need to be considering? Social value has jumped to the top of many organisations’ lists, increasing work with SMEs and Social Enterprises. And let’s not forget an increased focus on harassment, discrimination and equal opportunities following #MeToo and campaigns like Procurious’ own ‘Bravo’.

What Does the Network Say?

When asked their opinions on what the critical factors were, the Procurious network highlighted the following:

  • Previous Safety Performance
  • Service Delivery
  • Efficiencies
  • Cultural Fit
  • Price/Cost
  • Flexibility
  • Ethics
  • Quality and Consistency
  • Supply Chain
  • Financial Stability
  • Environmental Policies
  • Communication

I’ve highlighted in bold the criteria that appear in the previous list that also appear in the new one. As you might expect, they are the common criteria that procurement are known for, and may be expected to deliver as standard.

It doesn’t appear that other factors in line with Sustainability, Social Value and Equal Opportunities (to name but a few) are getting much of a look in. However, we’d need a much bigger sample to be sure. And that’s where the wider knowledge base comes in.

Procurement’s Response

Having a trawl through the latest articles on supplier selection and key criteria two things struck me. One, there were very few articles, blogs, thought leadership posts or even research papers from the past couple of years. The most recent one I found was from early 2017 and even using a broad range of search terms, it was difficult to find anything relevant.

The second, and perhaps most surprising/concerning, thing was how few mentioned any different criteria for suppliers. Only one article I could find mentioned Social Responsibility or Environmental Performance/Sustainability. The remainder still focused on the criteria commonly found in a Commercial or Technical/Quality evaluation. The most common criteria still were:

  • Years in business and financial stability
  • Price/Cost
  • Quality and Delivery
  • Reliability
  • Communication
  • Cultural Match

What does this say about procurement? Is the profession still falling back on the old favourites when it comes to supplier selection? Or could it be that traditional “thought leadership” is no longer leading the way, and organisations are working differently without shouting it from the rooftops?

For me, it’s a combination of all of the above. There’s no denying that it’s hard to separate procurement from cost and quality (after all, it’s what we’re there to do). And why wouldn’t professionals use criteria that are both reliable and easy to measure, particularly when time and resources are tight?

Getting our Message Across

Speaking from experience, however, there are areas in which overall value is much more prevalent. In the Scottish public sector, organisations are mandating Community Benefits for contracts above a certain value. These can cover everything from creating apprenticeships to financially supporting community projects.

In addition, Local Authorities have started to mandate evaluation of ‘Fair Work Practices’ in all procurement exercises. Again, this can cover a multitude of elements, such as paying the living wage, no zero-hour contracts, equal opportunities and good training and development. Suppliers are being forced to consider these criteria to the benefit of their employees and the wider society.

There is good work going on in procurement, but maybe we aren’t making the most of communicating our message to the wider market. And if communication is one of the key factors in supplier selection and subsequent relationship management, it’s high time the profession started telling suppliers what is important to us and seeing what they have to offer.

Best of the Procurious Blog – 3 Ways To Increase Your Procurement Salary

Another day in your procurement job, another day moaning about your unsatisfactory salary… If you want things to change here’s how you take control!

I’ve always said that I’m extremely happy working in Procurement, and there’s no question that it’s great to be doing a job that I’m passionate about.

But no matter how much enjoyment we get from our work – money is always important and a key contributor to our chosen career path.

Of course, you and I would both be happy to double our monthly income; so I thought I’d outline three pieces of advice to help you get there!

  1. Get paid for your value, not your time

Do you have a clear understanding of how your current salary was calculated? Is your employer buying your time or buying your skills?

Many procurement professionals make the mistake of thinking they are paid per working hour. But the main consideration for your employer shouldn’t be  “how hard is this person working?” but rather  “how much value is the person generating for the company?”

So my first piece of advice to you is this: Start thinking about what value you are creating for the company – start measuring it! If you measure your results and your ambitions you have a much stronger argument when it comes to salary negotiations.

Take a look at these two scenarios. If you were to approach your manager to discuss a pay increase, which one sounds more authoritative?

A) I have worked overtime and several weekends during the past six months. I don’t give enough attention to my partner and family. So I think I deserve a salary increase of +20 per cent.

B) I have finalised three major RFQ’s within our category during the past 6 months and  I have reduced prices by 12 per cent per year for our company! I think this performance justifies a salary increase of 20 per cent.

Try to use the employer’s language as in scenario B. Find the arguments and KPI’s which you know they will value the most and think about how you can add influence in these areas. Then all you have to do is impress them with your results!

2. Take more responsibility

Do you enjoy responsibility  or do you avoid it at all costs – letting others make key business decisions for you?

Both behaviors are quite natural. After all, people are different. But ask yourself, what is the main difference between you and your manager at work? Why do they earn a significantly higher salary than you? Many managers have less knowledge and skills than their co-workers and employees, but they are still respected more by the top-executives. How does that always happen?!

The simple answer is that your manager has the responsibility for a much bigger area of the work.

The rule:  greater responsibility = greater salary.

So don’t allow yourself to hesitate when it comes to taking on responsibility. Don’t just wait to be asked, be proactive.

“I heard that our Procurement department plans to run the value stream mapping for Category XYZ. Can I lead this project as I know the processes and steps for VSM?”

“Can I take the responsibility for mapping new suppliers in South Asia, as I already have many business connections there?”

This approach to your work will stand you in good stead to get a significant salary increase when the time comes to negotiate.

Generate profit  for the company

In my experience most organisations consider their procurement department to be the cost centre of the business. Others regard it as a support or service function and,  in the worst cases, they dismiss procurement pros simply as buyers.

But you and I both know that procurement  has an enormous impact on an organisation’s profit.

Whatever your savings are – they contribute to the gross profits of the company. As we say at Future Procurement organisations: “one dollar saved is one dollar earned!”

So how can this knowledge help your salary?

Senior management in your organisation may not understand the value procurement brings to the business and they certainly won’t be familiar with your individual responsibilities and deliverables. They even may not understand the role of Procurement organisation…

But top management of any company cares about profit, this is the language they understand.  So modify your messaging and communicate the extra business profits that are connected to your procurement role.

To sum up; if you want your salary to increase you need to add value to the company, take more responsibility and concentrate on proving the profit you contribute to the company.

Remember; your employer will never care about you more than you care about yourself – it’s sad but it’s true!  Throughout my corporate career, the  biggest salary increases were never initiated by my boss.

Your salary is your own responsibility and if you don’t like it – it’s your problem to fix.

So get out there and fix it!

Best Of The Procurious Blog – Is It Time To Make A Career Move? Mind the gap

When things get bad at work do you find a way to fix it or consider a career move?

The bad days are becoming more frequent, the work is no longer challenging and your procurement career seems to be floundering.   The question arises: what must you do to kick your work life into action?   If you have a general feeling of being undervalued or not being fairly recognised for your achievements, now is the time to take stock. Work takes up at least 40 hours of your week.  Life’s too short to be miserable, this is decision time.

It is unlikely that your current situation will improve much unless there is a radical change in management or strategy.  The options are:

  • Move into a new role at your current employer or
  • Move on to a different employer in a similar or different role 

Assuming that procurement is still the place you want to be, there are some steps you need to take whether you plan to stay with your current employer in another role or move on to new adventures.

Do a personal gap analysis

Take a deep, introspective look into yourself. The aim is to identify the knowledge gaps between the skills you need for your chosen direction and those that you currently have.  What changes should you begin making to prepare yourself for the kind of job you want? As Abraham Lincoln said, “The best way to predict the future is to create it.”   Be realistic about your current capabilities.  Then go and fill the gaps.

Consider further education   

There’s no doubt that further education and continued professional development play a part in opening up opportunities. The reality is that most the attractive roles require some tertiary education or certification, especially in a tight job market. If you are lagging in this area it may be an opportune time to upgrade.   If your current employer can subsidise your work-related studies, take advantage.    No funds?  There are lots of free training available, there’s no excuse.  What about a Massive Open Online Course (MOOC)?

 Learn the new skills

There are roles that didn’t exist ten years ago and those are where experience is in short supply.  The application of I.T. technologies to procurement problems is growing fast:  consider data analysis and warehousing, supplier relationship management (SRM), and procure-to-pay (P2P).   Also, both the public and private sectors struggle with issues of fraud, corruption and conflict of interest. Companies need people who can exercise constant vigilance over supplier risk, governance and contract compliance.

Sustainability issues are placing new demands on procurement leaders and their teams.  “Green” procurement is a growth niche where there is a limited number of experienced applicants and pressure is building on companies to limit their negative impact on the environment.  Focusing on fields that concern you (and the consumer) and those that play to your strengths will deliver the most work satisfaction.

Get a grip on the numbers

Whatever direction you choose, advanced analytical abilities are becoming mandatory.  An in-depth understanding of financial ratios and the triple bottom line can give you the edge over others competing for similar roles.  If you don’t know what macros or what a cash flow crisis is, now is the time to find out. If your current company offers in-house courses that can enhance your computer skills, sign up.

Influence and persuasion

A survey conducted recently by Accenture amongst global CPOs noted that traditional areas of knowledge and experience are less important to success than the ability to develop and sustain high quality internal and external relationships.  Stakeholders can influence your project’s success or failure.  Good stakeholder management just means being able to win support from any and all interested and affected parties such as end-users, subject matter experts and key suppliers.

Attitude is important, that much is clear.  It seems behaviour and demeanour can impact on career progression as much as technical know-how.  Always do what you promise to do.  To paraphrase  J.F.Kennedy,  don’t think about what your stakeholders can do for you, think what you could do for them.

Communicate your successes

Keep an on-going record of what you have done well, e.g. reported cost savings, accolades you have been given, and positive feedback received from internal customers.  This information can be used to enhance your CV.  Don’t be shy to share your successes; it’s a good confidence booster.

Moving employers   

Moving on to another employer or launching yourself as a consultant or contractor may be a choice, or it may be thrust upon you.  Protecting yourself fully from downsizing and “restructuring of the workforce” is pretty much impossible.  Don’t despair. Review your achievements to date, fire up your CV and take yourself to the market.    Sometimes you have to take a step backwards to move forwards.

The best a person can do to rise above the mainstream is to have a good attitude, stay relevant, keep up with trends, communicate well and keep the networks alive.  Sometimes the current environment is not going to deliver the options you need. Then it is time to move on.

Best of the Procurious Blog – Five Best Negotiation Scenes In Film And TV

How much can you learn about negotiation by sitting on the couch watching movies? Plenty.

Shutterstock/ Fer Gregory

Want to become a better negotiator? You could diligently read up on the subject or attend some negotiation training courses, but for the couch potatoes amongst us, you might just learn more by watching some of your favourite films.

Negotiation scenes come in many varieties in film. Often they’re in the form of a hard sell (think Leonardo DiCaprio selling dodgy stocks in The Wolf of Wall Street), or a hostage situation (Tom Hanks negotiating for his freedom in Captain Phillips) or other life-threatening situations such as Mel Gibson trying to talk a suicidal man down from a ledge in Lethal Weapon.

But when it comes down to the nuts and bolts of haggling, the following five scenes give illuminating examples of how to win – or lose – in a high-stakes negotiation.

  1. Sticking to your final offer – Nightcrawler (2014)

Jake Gyllenhaal’s character Lou is trying to sell a video of a crime scene to Nina, a TV news manager. Watch for:

  • Lou being willing to haggle down to a certain level, after which he refuses to budge.
  • The power shift in the negotiation from Nina to Lou (aided in part by Lou’s creepy intensity).
  • Lou throwing in a number of extra conditions when he knows he has Nina beaten.
  • Best line: “When I say that a particular number is my lowest price, that’s my lowest price, and you can be assured that I arrived at whatever that number is very carefully.”

  1. Doing your homework before a negotiation: True Grit (2010)

In this Coen Brothers film, 14-year-old Mattie Ross (played by Hailee Steinfeld) shows what horse-trading is all about – literally. In order to raise money to hire a Deputy U.S. Marshal to help her track down her father’s killer, she approaches an auctioneer named Stonehill with two demands – that he buys back the ponies he sold he father, and that he pays her $300 for a horse stolen from his stable. At first, Stonehill laughs in dismissal, but Ross’s perseverance and detailed knowledge of the relevant law wears him down until he yields to her demands – plus a little bit more. Watch for:

  • The moment Stonehill mentions the valuation of the horse and hence kicks off the haggling process.
  • Mattie’s threatening to walk out on the negotiation and go to the law, causing Stonehill to adjust his offer in panic.
  • Best line: “I do not entertain hypotheticals – the world as it is is vexing enough.”

  1. Negotiating across cultures – Snatch (2000)

Warning: strong language.

When boxing promoter “Turkish” and his partner Tommy approach Irish Traveller “One Punch” Mickey O’Neil to ask him to participate in a fight, the prospect seems simple enough. The only problem is, Mickey (played by Brad Pitt) has an almost unintelligible accent. His price is the purchase of a fancy caravan “for me Ma”, and then proceeds to list off all the features he wants included in the deal … while Turkish and Tommy can’t understand a thing. Watch for:

  • Mickey’s impossible-to-understand list of caravan features. The video clip below includes subtitles, but cinema audiences had no such assistance when this film was released.
  • The bewilderment on Turkish and Tommy’s faces as they realise they don’t know what they’ve actually agreed to. The cultural barrier between the Irish Travellers and the other characters in the film is a running theme that goes far beyond the tricky accent.
  • Best line: “Did you understand a single word of what he just said?”

  1. Coercion – Ocean’s 11 (2001)

“Frank”, played by the late Bernie Mac, has been tasked with sourcing the transport needed for the team to undertake the crime of the century. The dealer names his best offer, and Frank appears to accept. So far, everything seems to be going smoothly … until the handshake. Frank extends the grip to a full 60 seconds, apparently crushing the car dealer’s hand while chatting amiably the whole time. The car dealer, desperately uncomfortable and in pain, abruptly drops his price before freeing his hand. Watch for:

  • The range of emotions playing over the car dealer’s face as he realises he can’t free his hand.
  • Frank’s feigned surprise and gratitude when the dealer drops his price.
  • Best line: “If you were willing to pay cash, I’d be willing to drop that down to seven-SIX-teen each.”

  1. The power of silence: 30 Rock (TV series 2006-13)

By simply sitting in near-silence and looking stern, grumpy babysitter (Sherri) is able to make Jack Donaghy so nervous that he doubles her pay for working half the time. Donaghy (Alec Baldwin) comes into the negotiation with his usual swagger, but Sherri’s silence causes him to blabber and rapidly cave. Appalled at his own performance, he confronts Sherri a second time. Watch for:

  • Sherri’s tactical silence when Jack pauses to let her speak.
  • Jack rolling his eyes when he realises how badly he came out of the negotiation.
  • Best line: “I made every mistake you can in a negotiation. I spoke first, I smiled … I negotiated with myself!”

Want to suggest some other films or TV shows with great negotiation scenes? Leave a comment below!

Best Of The Procurious Blog – How To Tell You’re Working For A Psychopath

Psychopaths are present in every workplace. And the higher you go in the organisation, the more likely you are to encounter one.

Working for a psychopath is no holiday. Here’s how to tell if your boss is one, or just a garden variety bully.

A human resources manager is more likely to know them as sociopaths, micromanagers or workplace bullies. I call them psychopaths, not to insult them or even to suggest that they might be chopping people up for fun, but because they share a common set of character traits with all those personality types and also with criminal psychopaths.

1. They are two-faced

A workplace psychopath has a two-faced nature. One face oozes charm and charisma, while the other is viciously mean. They work very hard at flattering those that have power over them, but present a very different face to the people that work for them. To most of their team they are manipulative and controlling. People who work for a psychopath see this face most of the time.

2. They have a pawn

Psychopaths will also recruit a pawn or two. These are people who the psychopath won’t attack, so long as they do their bidding. Frequently it is the pawn delivering the latest piece of manipulation rather than the psychopath themselves. This allows them to put distance between them and their victims and build in automatic plausible deniability if it goes pear-shaped. “No, Terry-The-Pawn was acting on his own initiative, it was nothing to do with me.”

3. They are excellent liars

They are convincing liars and they lie compulsively, often for no apparent reason. The truth to them is whatever needs to be said at that moment. It is whatever they judge their audience wants to hear. And they will have no compunction aggressively assuring you something happened which you know didn’t, often to the point where you will doubt your own memory.

4. They treat employees as dispensable livestock

They treat most people who work for them as dispensable livestock. And this usually causes the cattle (that would be you) unprecedented levels of stress, frustration and fear. When one victim burns out or leaves, they just move on to the next. They damage the health of individuals and the reputation of the organisation without any regret or shame. The workplace under a psychopath is in constant turmoil. Factions are rife, sick leave sky-rockets, staff turnover becomes endemic and productivity drops like a stone.

5. They can’t take criticism

They react to any criticism with aggressive denial or retaliation. If those aren’t options, usually because the critic has more power than them, they will feign victimhood or blame the victims of their actions. Punishment and threats have absolutely no effect on them. They will keep doing things their way, regardless.

In short, they are the classic malevolent workplace bully. This is not to say that all bullying in the workplace is done by psychopaths. Bosses can be mean but it is the frequency of bullying-type behavior that sets psychopaths apart from an everyday horrible boss.
In 2008, UK researcher Clive Boddy from Middlesex University set out to determine exactly how much workplace bullying was caused by psychopaths.

Boddy took a psychopathic checklist and embedded it in a management survey of Australian middle and senior managers. Almost six per cent of the respondents were working with a corporate psychopath as their current manager and thirty-two percent had worked for a psychopath at some time.

A further eleven per cent of respondents were working with managers who showed some psychopathic traits but were not rated at maximum in all categories.

The respondents also revealed how many times they had experienced bullying. Under normal managers, employees encountered bullying less than once a month (nine times a year), but the moderately psychopathic managers bullied employees more than twice a month (on average twenty-nine times a year), accounting for a twenty-one percent of all bullying. If that manager was a psychopath, the employee experienced bullying more than five times a month on average (64.4 times a year) and this accounted for twenty-six percent of all reported cases of bullying.

This means that, as an employee, you can, and probably will, be bullied in the workplace. If your boss is normal, bullying will happen once every six weeks or so. If you are working for a psychopath it will happen once or twice a week, or more. If the behavior described above is happening all the time then your boss is a psychopath. The bad news is that there are not many good options for solving it.

The exit beckons, but while you wait for the right opportunity, there are a number of things you can do to protect yourself and improve your position. Those strategies are the subject of the next part of this series.

Best Of The Procurious Blog – “Hey, Procurement…” The Rise of Chatbots in Supply Management

Procurement tech guru Bertrand Maltaverne explores the benefits, limitations and pitfalls of chatbots in procurement – with some animated examples!

“Hey, Siri,…”

“Alexa,…”

“OK Google,..”

Digital assistants are ubiquitous. We talk to them (Siri, Alexa, Cortana, etc.). We chat with them (Twitter, Facebook Messenger, Skype, WeChat, etc.). They are in our phones, in our computers, and even in our homes. Now they are also making their way into our offices!

Procurement professionals need to start taking notice, because chatbots present a valuable and unique opportunity to provide better services and experiences for internal customers and suppliers. They can also support and assist procurement professionals with their daily activities, becoming virtual colleagues or consultants.

Of course, as with any new piece of technology, it is important not to succumb to the hype and to be aware of the technology’s limitations and constraints before deploying bots everywhere.

Value = Outcomes AND Experiences

The term “Conversational Commerce” was coined by Chris Messina in 2015. In his article, he focused on how messaging apps bring the point of sale to you. He first introduced the idea of assistants that people could interact with to buy things from a company. This is precisely what Amazon did and has popularized with Echo (the hardware) and Alexa (the AI-based assistant that “lives” inside Echo).

The idea of voice or text-based interactions with a bot can be extended to much more than B2C and to “buying things”. The value proposition of such technology is to digitise interactions and conversations while also making technology more accessible.

Here are some of the benefits:

  • Gains in efficiency and effectiveness because of tailored and context-aware interactions. Chatbots remember everything, they know where you are, and can tap into data from all your other applications.
  • Less time and effort needed to learn how to use Procurement technology: conversations replace graphical user interfaces (everybody knows how to type or speak; no need to use explicit and codified instructions).
  • Interoperability and accessibility: users chat in the application or channel they prefer (SMS, Instant Messaging, Skype, Facebook Messenger, Alexa, Twitter, etc.). All bots leverage one common robust back-end system that processes and interprets natural language.

All in all, chatbots contribute to the creation of omni-channel and replicable but unique user experiences for stakeholders, suppliers, and for the Procurement teams themselves. Improving experiences is one of the pillars of the digital transformation of Procurement. In addition to delivering business benefits (savings, risk reduction, innovation, growth, etc.), it contributes to making procurement a supplier/customer/function of choice.

“Every time [customers] interact with a product, a service, a person, or an automated system, they judge how well the interaction helped them achieve their goals, how much effort they had to invest in the interaction, and how much they enjoyed the interaction.” Outside In: The Power of Putting Customers at the Center of Your Business by Harley Manning, Josh Bernoff, and Kerry Bodine

Use Case 1: Guided Buying (Chatbot as an Admin.)

This is a use case that is very close to B2C: a Procurement assistant is deployed to handle demands from the rest of the organisation in order to replace or “augment” traditional eProcurement solutions. Requesters interact with a bot that proposes solutions based on:

  • the needs identified during the conversation,
  • the Procurement strategy (preferred suppliers, preferred items, contracts in place),
  • other factors (purchasing history, real-time availability of products, context, etc.).

The approval process also happens via chat. If available, the chatbot adds the approver to the conversation, creating a group chat. Or, the Procurement Assistant opens a new one-to-one conversation with the relevant approver. Approvers can then ask the chatbot how much of the budget is left and then immediately approve/decline the request without leaving the chat. The same can happen for other process steps (order confirmations, goods receipts,etc.). The assistant initiates discussions to ensure the process is compliant and efficient.

Use Case 2: Operational Support (Chatbot As a Colleague/Consultant)

Chatbots can also be invaluable assistants in operational support. The most straightforward and immediate application: query management. A chatbot can become the single point of contact for internal and external queries about purchase orders, invoices, and much more. Several companies are already successfully using such capabilities in their Procurement portals to provide quick answers to a vast amount of queries, which leaves their teams with time to focus on  more complex requests and value-adding tasks.

It can even go further as the following scenario demonstrates:

Now, let’s compare what happened above with a scenario in the context of siloed organisations and where such technology wasn’t used. The purchaser would probably have learned about the earthquake on his way to work while checking the news on his smartphone. He would only have been able to assess the situation and prepare contingency plans once he arrived at work, losing valuable time. In may organisations this would take hours or even days because access to information is spread across multiple systems. This would result in a very different reaction time compared to the example above, where the cognitive agent reacted almost immediately after the event and prepared recommendations during the night.

Pitfalls and limitations

Relying on conversations instead of graphical  user interfaces has many benefits, especially for the mobile worker or casual user. However, there are limitations and challenges.

Voice-based conversations are the most natural ones and are also the most challenging from a technological perspective, especially in a B2B context. This is due, in part, to the international nature of business. For example, names of people or companies are not familiar words that a chatbot can quickly recognise, and to make things worse, they are often not in the same language as the one used to converse with the bot.

In addition to technical challenges like these that will likely be solved someday, there is a more human challenge: the conversational paradox. It explains why chatbots are still not widely used.  The paradox is that something very natural (a conversation) is done with another unusual counterpart (a machine), which turns the experience into a very unnatural one. So, when asking a chatbot something, the first questions people are confronted with are:

  • what instructions can “it” understand?
  • what words should I use to make sure I will be understood?

This represents  both a significant barrier to usage and a risk for adoption. It is therefore important to design and deploy chatbots with that in mind and:

  • not to use them as the only communication channel (it should be one among many others),
  • not to oversell the technology as being human-like (it inflates expectations and is a guarantee for failure),
  • to provide cues and guidance (like the menus/lists in the examples above)
  • to have a smooth and almost transparent hand-over to a real person if the machine fails to understand a user.

Conclusion

“By 2020, 30% of web browsing sessions will be done without a screen.” –Gartner

Conversational user interfaces are still a novelty, especially in B2B. However, they will become more widely used as technology makes further progress and people get more used to it. So, for Procurement, now is the time to investigate their potential as an additional way to provide a streamlined and personalized user experience both inside and outside of the function.

In addition to  delivering the right outcomes, experiences are also a crucial component of the value that the rest of the organisation gets from Procurement. Customer satisfaction is at stake.

The implementation of chatbots, like any other technology, has to be pragmatic, defined by clear use cases, and should not be viewed as a solution in itself. Chatbots will not solve all of an organisation’s problems, , but they can be used as a means to an end!

Time to learn how to say: “Hey, Procurement…”