Category Archives: Generation Procurement

Is Your Personal Brand Picture Perfect?

Employers are increasingly using social media to hunt down their next employee. So what’s your personal brand saying about you?

Your Personal Brand

Today, a staggering 90 per cent of UK employers use social media to find employees. As we all know, a large proportion of roles are never formally advertised, with employers preferring to rely on references and people they “know” to fill important roles.

An important secret you need to know from the recruitment industry is about ‘passive’ candidates. These are people who are not actually applying for jobs, but are seemingly happily engaged in their current roles, as opposed to those who have actively applied for the role. These passive candidates are actually the most valued candidates.

So, the question is how will these silent employers “know” you, if you aren’t out networking, connecting and promoting yourself on social media?

The Importance of Networking

I had the perfect example just this week when a headhunter called me for some recommendations for the Head of a Digital Procurement Marketplace. It was a very senior job, paying in the high $200,000s.

I have worked in this profession for more than 15 years and am very committed to networking. I am fortunate to have met thousands of procurement professionals, have more than 5,000 connections on LinkedIn, and am an active participant in the 12,000 strong Procurious community.

Now, when I was asked for recommendations, who do you think came to mind first? Someone I met ten years ago when eMarketplaces were all the rage? Or someone I saw sharing information on LinkedIn or Procurious earlier in the day? The latter, of course.

In order to help you understand the importance of your network and online profile in helping you get that next job, let me share how my mind worked when trying to think of some suitable candidates.

Standing Out

I started thinking through the thousands of events and meetings I had attended and personalities that had stood out – I came up with a few names.

Next, I started reviewing my online social networks. First I found people who had the right skill set and experience, then I started looking at people’s profiles in depth. This was quite a lengthy process, so I used some filters. This is who didn’t make the list:

  • People without a photo on their profile.
  • People with limited connections (sorry, to me, its hard to think how anyone in procurement could have fewer than 500+ connections).
  • People whose work history hadn’t been updated or was very scant.
  • People who, when I googled them, weren’t mentioned anywhere, hadn’t published anything, or spoken at an event.

If people met any of these filters, I wasn’t going to recommend them. I would imagine many other senior people like me would use the same process. I know recruiters definitely would…

Why? Because my personal brand is on the line when I recommend someone. I only want to recommend people who are “in the loop” and up to date with what is happening in the world. And those are the people who are building and using their networks.

‘Picture Perfect’ Personal Brand

For this reason, all your work history, successes and contact details are important to include on your social media profile. But I want to particularly stress the importance of an impressive profile picture.

Our mission at Procurious is to change the face of procurement. So many images of procurement out there today reinforce a very old, brown cardigan-clad image. We want to replace those images with fresh, global images of being “the smartest guys in the room”.

Make sure your headshot is just that, a headshot where people can clearly identify you as you. Make sure your attire and demeanour are professional and represent how you would look turning up for a job interview – no selfies, no wedding photos, no hazy screens, favourite cars, or children. You laugh, but we see a lot of crazy things on Procurious, which is why I’m making this point.

Personally, I think of a shot of you speaking or in action in a professional setting can be powerful to promote you as a thought leader. These are tough photos to get, so a plain vanilla corporate headshot will also serve you well. Using the same photo across all social media can be powerful as your ‘personal brand’ is consistent and is reinforced each time someone sees you.

After all, a picture is worth a thousand words.

This blog is part of a speech Tania made at the eWorld Procurement and Supply Conference in London on 2 March 2016. In her next instalment, she will share why being first with the news will help you be a first mover.

The Fine Art of Negotiation

Your negotiation skills come into play practically every day in the procurement game. But that doesn’t mean there isn’t room for improvement.

Strong negotiators master verbal, written and non-verbal communications. They’re assertive, approachable and know what they want.

And while procurement professionals are relying on their negotiation skills more than most, there’s always room for improvement to ensure you’re getting what you want during the negotiation process, regardless of whether you’re the buyer or seller.

Getting the Right Result

Strong negotiators rely on specific skills including patience, self-confidence and creativity. This is according to Australian business and leadership coach Cheryl Daley, who focuses specifically on the art of influencing others.

“People don’t often believe they have strong negotiation skills, but it’s a skill we all need in life, particularly in business. There’s always better ways to approach negotiations, but we often fall into the same rut and forget about the importance of looking for new ways to get the result we want when negotiating,” Daley says.

Negotiations often become a power-play between two parties, but the aim should be for everyone to walk away feeling good about the outcome, she says.

Long-Term vs. Short-Term

Anyone about to enter into a negotiation of any kind should start by determining the type of negotiation it will be.

“The type of negotiation will have a huge impact on the way you approach it. A buy and sell negotiation with someone you will deal with once, will be a completely different situation than if you’re entering into something you believe will be a long-term partnership,” Daley explains.

“The longer-term negotiation processes in the business world can take months or even years. These usually involve higher stakes, and can involve a discussion back and forth for some time until everyone has an outcome they are happy with.”

Set Your Goals

Be sure to set the goals in your own mind, before the initial discussions with the other party, so you don’t feel disadvantaged from the outset, Daley says.

“Be prepared to do some personal preparation before the first discussion with the other part. Always be polite and create a dialogue that doesn’t position one party as the ultimate winner and the other one as the loser. Be firm, but not aggressive. Stay calm, because the moment you lose it, you’ve lost the battle.”

Knowing what the other person’s weaknesses are will really help. It’s easy to be steamrolled by the other party if there’s no connection or relationship in place, so take the time to get to know them, and how you can help them achieve what they’re aiming for.

“It will always be more difficult to negotiate if you don’t first ask a few questions of the other party first to determine whether you’re able to solve their problems during the negotiation process. Otherwise, you could find yourself at a disadvantage,” Daley adds.

Not All About Price

Meanwhile, licensed Buyers’ Agent Nicole Marsh reminds us that negotiation isn’t always just about price. Often, negotiating other terms for real estate buyers such as a longer settlement, being able to move in on an earlier date, or the vendor leaving behind the white goods is enough to get the deal over the line.

“Long term partnerships may require each party to make concessions to make it work and may involve more problem solving skills to get the deal across the line,” Marsh says.

On the other hand, when a negotiation does come down to price, it’s important to set a ‘walk away’ price so you don’t agree to a higher price than you can afford, she says.

“It’s never too late to look at how you approach your negotiations, and consider adding new skills to your repertoire,” Marsh says.

Top Tips for Negotiating

Marsh also shared her top tips for negotiating:

  • Be firm, but not aggressive.
  • Strive for solutions that work for both parties.
  • Stay calm. Stick to the issue, and don’t become hostile or frustrated.
  • Don’t take it personally.
  • Pick a mutually convenient time and place for the negotiation to take place.
  • Put details in writing.
  • Consider whether you need legal advice.

Going to Negotiation Training? No, I Learned Last Week

In the final article in this series, I consider how our stakeholders outside of the procurement function consider negotiation. After all, everyone can negotiate, right…?

Mangostar/Shutterstock.com

As seasoned buyers many of us will have been asked the question; “Can I join your next negotiation?”

Nearly always the request is well meaning and indicative of a willingness to learn the art which is core to our profession (despite my belief that buyers fall back on the perception of their own negotiation skills too easily). It is also, I feel, always unintentionally dismissive of the skill itself.

Unwritten within the question is the inference that the invitee assumes learning to negotiate can be done within a few hours, and perhaps even in a single sitting. “I’ve attended the training course, now I need to take the test”, is the secondary call. Those of us practising negotiation for all of our careers know all too well that during every negotiation, even the most experienced and skilled of us make mistakes, and value egresses to the other party outside of our control and planning.

Of course, being the type of individual who is passionate about developing people, particularly in the area of procurement and business management, I seldom refuse a request and attempt to install the observer in to the next appropriate negotiation. Many readers will also recognise that this often means waiting several weeks or months as “good, old fashioned, round-the-table, face-to-face” negotiation happens less and less in today’s technology driven world.

Perpetual Conditioning

Without question, we are “negotiating” during every email, phone call or meeting that we have with our negotiating counterparties – or “conditioning” as we like to call it. We negotiate by requesting our leaders to set out our message to their senior counterparties.

We set out and plan our negotiation, conduct detailed cost and market analyses, plan the room layout, the attendees, the tone of the questions and who will ask them, our critical requirements and our tradeables, and lots more besides. And after all this work, unseen by the requestor, we execute the negotiation, hopefully in the allotted time. However, I contend that the single most critical success factor in any negotiation is ensuring you are negotiating with the correct party. Note: I say party, not person.

Having the correct person in the room is important, too. Most of us will have learned a valuable lesson at some point in our careers by experiencing frustration and delay at a counterparties repeated requirement to refer to more senior colleagues. “Surely you expected that question and prepared a response?!” is our, often silent, cry.

But, my point is not about having the correct person in the room, it’s about negotiating with the correct party. Negotiating is tough enough with a counterparty that is willing and hungry to reach a resolution. Negotiating with a party who simply does not have to negotiate; a party who does not need to concede and does not believe he will lose is the toughest of all. And this, invisible to the prospective negotiation observer, is where the high performing buyer excels.

This type of negotiation started a long time; ago often months and sometimes years ago. Recognising a growing dominance or complacency of any given counterparty, the skilled negotiator develops hunger. A hungry competitor who may or may not force the complacent of dominant supplier to move position and concede value. It actually doesn’t matter whether the incumbent moves position or not, the high performing buyer now has options.

Negotiation 101

Do not misunderstand my point here. I am not describing the time-served tactic of “play one off against the other“. At the start of this negotiation there simply were not two parties to play off against each other. Success in this negotiation is the culmination of hard fought manoeuvring, which ultimately makes the dominance of the incumbent supplier irrelevant.

Manoeuvring which creates a credible threat to the incumbent where previously there was none. All of a sudden the negotiator has options. All of a sudden the BATNA (Best Alternative to Negotiated Agreement) just got a whole lot better and a positive result will ultimately be obtained.

I am also conscious that my use of the word manoeuvring may be perceived negatively. It is not meant to be so. In the world of complex, multi-national negotiations with poor market dynamics, limited competition and high switching costs, I use the word merely to explain what is necessary to extricate an organisation from contracts with under-performing suppliers.

In this sense manoeuvring is meant only in a positive and necessary sense and it may occur for years before tangible results. But as high performing buyers, manoeuvre we must, unless of course, we are content with negotiating brilliantly with the wrong party. 

Read more articles from me on Procurious here and here.

Jim WillshawJim Willshaw (MBA, MCIPS, MIIAPS) is an experienced procurement professional acting as a consultant, speaker, coach and trainer to leading organisations all over the globe.

5 Must-Have Attributes of Successful Procurement Leaders

Not all successful procurement leaders have the heady designation of Chief Procurement Officer (CPO). Forget the title, it is just a label. What is important is that for any person to lead a procurement organisation, he or she requires a basketful of skills and abilities.    

The good news is that no one person in a leadership position in procurement is in possession of all these skills. Most technical skills, such as strategic sourcing and contracts management, can be learned over time through training and experience. The jury is still out on whether behavioural traits, like the ability to lead teams and communicate effectively, can be developed.

Many recruitment advertisements ask for attributes using undefined phrases such as “good communicator”, “visionary”, “innovative”, “collaborative”, without knowing what they really mean. Here are five main attributes that procurement leaders need:

1. Ability to Drive Change

Many mid-sized organisations are grappling with the transition from a tactical function within the Finance Department, to a strategic function within the supply chain. The main objective will continue to be cost reduction, sometimes combined with or expressed alternatively as value creation.

Managing change is difficult. It needs a firm hand and a strong will, while being calm under pressure. The ideal person to manage the transformation may be a new hire from another industry, or a seasoned executive from another function in the business. What is important is that he/she has a track record of influencing top management and internal stakeholders across all functions.

Dapo-Ajayi

Dapo Ajayi, CPO at AstraZeneca, came into procurement management from the sell-side of the business. She has paid her dues, having worked in a variety of senior marketing and branding roles in multiple countries over a period of 10 years.

2. An Affinity for Leading People

It is generally accepted that a collaborative and participative style is a preferred trait. Although traditionally successful, an autocratic approach now doesn’t work, particularly with the under 30’s. Retaining top performers is a constant battle.

Leaders will spend a fair portion of their time on competency development and building teams, as well as understanding what subordinates want and need from their managers to perform well. Because cross-functional teams are established features of best-in-class procurement organisations, leaders also need to nurture non-procurement members and earn their trust.

3. Talk Less, Listen More

For many CPOs, one of their goals is to gain the trust and support of their main internal customers or stakeholders. The key to understanding their problems is to listen intently and absorb their concerns without making knee-jerk assumptions and providing instant solutions. The desired result is to develop open relationships with peers and provide workable solutions for their users in line with corporate objectives.

The successful leader will develop a high level of skill in influencing the more difficult stakeholders and persuading them of the value that professional procurement adds.

Opening two-way communications, across all available channels, can increase cooperation and support from peers in other functions or divisions.

4. Global View, Local Focus

It is becoming increasingly important for procurement leaders to have had global business exposure. This can either be from working in virtual teams or preferably by having completed international assignments. Progressive firms are looking for those with process-driven experience, often in similar sized companies from other countries.

When recruiting from outside, people from management consulting firms, and those with re-engineering experience within the supply chain, are regarded as attractive candidates. Know global, think local.

5. Expertise in Procurement

Last, but not least. To have any credibility with top management, internal and external stakeholders and subordinates, leaders need to have some or all of the following knowledge and experience:

  • Category Management – By understanding the concept of leveraging spend across multiple commodities to deliver cost savings and create value, the leader who has shown results this way will be ahead of the competition.
  • Problem solving – Our prospective leader needs to be able to focus on the root cause of an issue and devise and test various possible solutions.
  • Procurement technology – A familiarity with the relevant available systems and tools will provide opportunities for speeding up and automating some routine functions or even outsourcing them.
  • Negotiation skills – Everyone has some experience of negotiation in their everyday lives. Upgrade those skills and get as much practice as possible.

What is likely is that you did not make the decision to become a leader in the procurement function, but guess what? Here you are, ready to launch! Opportunities are emerging for new types of leadership roles that did not exist a decade ago. Find one that suits you.

Is Procurement Ready for the Mobile Revolution?

The Mobile Revolution is firmly upon us, but procurement seems to be behind the curve when it comes to adapting. Why is this?

Mobile Revolution

Download GEP’s white paper on the role of procurement in the mobile revolution here.

“In all my time in procurement I have never seen a procurement person using an app.”

This was a quote passed to me by a colleague who was discussing our mobile procurement software strategy with the prospective customer.

You might be forgiven for thinking that this was some sort of dismissive statement, indicating perhaps an underlying Luddite tendency, “We’ve never used procurement software like that before so don’t see why we should start now”.

But, as it turns out, quite the reverse was true. This particular comment was made by someone enthusiastic about the prospect of a different way of employing technology, and the subtext was really, why is procurement so far behind the mobile revolution curve?

Procurement Inertia

This is a fair point. Human Resources and Sales Operations have been blessed with state-of-the-art technology solutions for some time. SaaS, and now Cloud, are de rigueur for our colleagues elsewhere in the business. But procurement still largely lumbers along with an online/offline hybrid of on-premise systems, spreadsheets and email.

As the quote implies, the inertia in procurement is not a result of lack of innovation or drive amongst the community. There is certainly a desire for a better, more efficient means to execute many of the processes and tasks encountered on a daily basis by the procurement professional.

The lag in evolution of the use of procurement software is largely a result of the legacy of direct materials management and ERP systems. Direct categories are so mission-critical that the systems used to handle planning, inventory and production are fine-tuned and locked-down to make them robust. But this in turn makes them inflexible, and the business becomes totally dependent on them.

When indirect categories are procured using the same systems, this intractability becomes a hindrance to progress and innovation. However, the ERP companies have no real interest in breaking the mould.

Technological Change

Expecting a sea-change for indirect procurement to come from that direction is probably in vain.

Decoupling the indirect categories to take advantage of up-to-date procurement technology solutions is a start. Inevitably, this requires deep thought and the investment of considerable brain power, but the results can speak for themselves.

New levels of efficiency, innovation, opportunity realisation and, of course, savings can result directly from the adoption of a new way of working with procurement software.

In a sense, that quantum jump of improvement can result solely from a procurement software system being simply better than the legacy system. Certainly, smart, professional individuals are able to force old-fashioned and outdated processes into something workable. But unleashed from such restrictions, those same people can really start to motor.

The Mobile Revolution

Mobile, app-based technology is a part of that picture. The only reason our guest has never seen a procurement person using an app is because the procurement software industry itself has been mired in the same inertia and legacy of on-premise solutions.  Well, most of the procurement software industry.

Mobile technology is going to have a huge impact on business-to-business operations and procurement is a key part of that. To find out more about state-of-the-art procurement software visit www.smartbygep.com.

GEP have shared a white paper on procurement’s readiness for the mobile revolution with the Procurious community. Download it at gep.procurious.com.

The Power of Networking

Networking is a breeze thanks to the proliferation of social media platforms out there, but when it comes to networking in the flesh, some of us freeze. Here’s how to handle it like a pro and make the most out of the opportunity. 

Networking-Event

Depending on your point of view, networking events can either be viewed as a waste of time, or present a huge opportunity for procurement professionals. While you may not always be in the mood for heading out to a networking event, there’s no denying that a good reliable network of contacts is various industry groups is paramount.

Sydney PR professional Catriona Pollard says some people are a little nervous about networking because they’re not entirely sure what is expected of them.

“Bear in mind that networking isn’t about going in to the centre of a room armed with a megaphone and blindly talking about yourself. Networking is about building relationships, not just promoting what you do. Remember, people are more likely to do business with people they trust.”

Facilitate the Introductions

Focus on building relationships and think about how you might be able to help others. For instance, if someone you’re talking to is struggling with AdWords and you know a great contact, you can introduce them. This will pay back in kind, Pollard says.

“It’s as simple as asking a series of open questions so that people talk about themselves, she says. Get the ball rolling by asking how their week has been and what they’re doing on the weekend, and go from there,” Pollard says.

Also be sure you’re turning up to an event that will provide you with maximum networking opportunities.

Think about it from a marketing perspective to consider who your audience is and whether you want to align with peers or potential business targets. If you’re more likely to pull out at the last minute, set yourself some networking intentions to get along to one event a week, or month. Also set some intentions about the event, such as having five good conversations and exchanging business cards, or meeting at least one person you want to have a follow-up coffee with, Pollard says.

“You need to apply some strategic thinking to find the events that will best meet your own business targets. Look up the website and look at their past events, the type of audience the event usually attracts, how many people usually attend, the style of the event and who’s hosting it, Pollard says.

Importance of Networking Diversity

Janine Garner, CEO of The Little Black Dress Group agrees.

A like-minded networking event limits the breadth of conversation, she points out. Ideally, you want to be in a room with a diverse network that consists of people with differing levels of expertise, age, gender and experience, she says.

“Lawyers sit in a room with lawyers sharing their legal experience from the industry of law. CEOs play golf with CEOs, fashion industry PR experts mingle with other fashion industry PR experts.

“Imagine instead, the colour of the conversation if instead you had lawyers, accountants, creatives, athletes, marketers and business owners discussing the various solutions to a problem. Imagine the different perspectives shared, the varying insights, the depth of conversation that would stretch thinking and push perspective wider,” Garner says.

Meanwhile, remember that going along with a friend isn’t a good idea, because you’re more likely to spend the entire event catching up rather than networking.

Leave Your Comfort Zone

People are very open to approaches when you’re alone, because everyone is generally in the same boat at a networking event. This can play to your advantage, points out the managing partner of Brown & Chase Talent Acquisition & Advisory in Australia, Nerissa Chaux.

“Attending events alone also pushes you out of your comfort zone and you don’t waste the opportunity by spending the entire event chatting to your friends,” Chaux says.

She’s attended hundreds of events, and says you can get the best out of networking by making sure that you’re attending events where people will generally be similarly-minded and your interests align, she adds.

“Also, arrive on time. It’s always great to be the first one at an event, as you have the best opportunity of meeting everyone who comes through the door.”

Also, don’t wait for others to introduce themselves, Brent Duffy, director of Sydney leadership consulting firm, Maximus International.

“Be genuinely interested in others. It should be an equal 50/50 conversation. Treat the event as if your CEO was in the room, and see it as an opportunity to learn and hear about different perspectives rather than trying to gain quick wins for yourself, Duffy says.

“People love to share their learnings. Asking for advice demonstrates humility, your ability to listen and be open minded,” Duffy says.

“It’s more important to be an attentive listener who comes across as authentic and trustworthy, rather than someone who speaks candidly or excessively about themselves or their business. True listeners are rare, and people will remember you for this,” he says.

Remember the Follow-Up

The follow-up is crucial to ensure actually attending the event was worthwhile. This can take many forms, depending on the connection that you’ve had.

Janet Culpitt has been networking as a small business owner of www.focusonwealth.com.au for 16 years, and now teaches others how to get the most out of networking.

She recommends connecting on social media the same day of the networking event. Also check out any other social media groups they’re involved with, and request to join those if they’re relevant to you.

Culpitt will choose to send an ecard, a handwritten note, send a text message or sometimes she will make a phone call to their office to leave a message of thanks for talking the other day with their receptionist.

“Emails are fine, but they’re so common these days that I like to mix it up with other communication tools.”

Stop…Millennial Time!

The Millennials are here and there is nothing you can do to stop them. Those born between 1982 and 2000 have surpassed the Baby Boomers in sheer numbers and are now the top consumers globally.

DavidNNP/Shutterstock.com

Hospitality is one of the most challenged industries when it comes to ‘Keeping up with the Millennials’, as it is typically a very traditional industry and change isn’t exactly its favourite word. Hotels in particular have been doing the same things, in the same way, for years now. They know change has to happen but more often than not they are quite uncertain as to what that change might be.

Marriott International for instance has gone from producing high-thread-count bedsheets to a YouTube Web series aimed at entertaining younger travellers. They also went on to buy Starwood Hotels & Resorts in a $12.2 billion deal because of its strong presence in the lifestyle brand category. W Hotels (part of Starwood) is all about edgy design, gourmet food and trendy public spaces — all features appealing to the Millennial traveller.

Redesigning for Millennials

A keen focus and demand for the latest technology, public areas with high speed WiFi for both work and play, as well as clever loyalty programs offering instant gratification, are all key to the millennial consumer.

“Millennials aren’t so interested in staying in their room, but congregating in compelling spaces with great design, music and a unique point of view,” says Jason Pomeranc, CEO of SIXTY Hotels. It’s why hotels like ACE and CitizenM are doing so incredibly well. They are first and foremost utilising their non-room space and creating inviting, cutting edge design hubs of interaction.

From major chains to small independent businesses, hospitality companies across the world are redesigning properties, spending a fortune on new technologies and even using Facebook Messenger for their Customer Service communications. It’s what Hyatt Hotels have done recently. In fact, there is a lot you can do from the app if you plan a stay at the Hyatt: check availability, make reservations, enquire about the view and even order room service.

How the Major Players Take Action

The reason for all this commotion – in the USA alone, more than 1 in 3 workers are Millennials, which amounts to some 83.5 million people. “They are becoming the earners, the spenders, the travellers, and importantly, the workers,” remarks Tina Edmundson, Marriott’s global officer for luxury and lifestyle brands.

Here is how a few major players are taking action based on this research:

  • Marriott launched Moxy and AC Hotels specifically with Millennials in mind
  • Best Western unveiled Vib, a chic urban boutique hotel
  • Hyatt premiered Hyatt Centric, an affordable lifestyle hotel
  • Hilton will open Canopy next year in Iceland. Each subsequent hotel will be inspired by the local community in everything from design to food and drinks

“By 2025, these guys are going to make up three-quarters of the workforce,” says Guy Langford, vice chairman and U.S. leader of travel, hospitality and leisure at Deloitte. And this is the one aspect the industry still isn’t facing. Most of the back office operations have not changed in the past 10–15 years. For Millennials, each day at work is like going Back to the Past…The heavy use of paper, spreadsheets and antiquated software makes adoption within the Millennial workforce sector very low.

This in turn affects staff retention and therefore drives staff costs ever upwards. Offering Millennial staff the opportunity to continue their digital, one-click habits at work by implementing technology heavily focused on User Experience (UX), is an absolute must for productivity.

“We have to understand what impact they’re going to have in 10 years’ time,” says Langford, “so changes made now, for both the Millennial consumer and the Millennial employee, will see huge ROI.”

Smart Cities – Revolutionising Public Procurement in Barcelona

Barcelona – a city of churches, tapas and endless Gaudi landmarks – boasts an intriguing procurement initiative that is fundamentally changing public procurement methodology. 

The concept is new and the way changes are being made is a stroke of genius. Traditionally, public procurement initiatives have looked something like this:

  1. Determine the problem
  2. Determine a solution
  3. Develop a scope of work containing detailed specifications as to how the problem should be solved
  4. Go to market to see who can meet your specification.

Decision-making is generally carried out within the four walls of a government building and leads to nothing more than a race to the lowest price point between two or three large suppliers.

Turning Public Procurement on its Head

Barcelona has completely flipped this process. Rather than telling suppliers what they want, they are simply outlining problems that are present within the city (like bicycle theft or potholes in the road) and asking the public to come up with innovative ways to solve them.

By opening civic problems up to the cities entrepreneurs, Barcelona is leveraging a vast pool of innovation and creativity that resides within its city. The following quote by CityMart‘s (the organisation behind this initiative) CEO, Sascha Haselmayer, sums up the approach brilliantly.

“City governments need to get out of procuring by specifying the solution they want. They can’t possibly have enough knowledge to do that well. What they should do is specify the problem they want to solve and show metrics on what success looks like. And then allow the market to inspire them to find the best solutions.”

As well as suggesting product solutions, applicants to the BCN Open Challenge are encouraged to challenge current city regulations and services in order to address six of the city’s key civic problems. Essentially, the canvas is blank and creativity, freethinking and innovation are encouraged.

The response to this initiative has been astonishing. Since Barcelona published its six city challenges online, the initiative has received over 50,000 views and more than 100 official submissions. CityMart stated that a benchmark number of views for public procurement contracts of this nature would normally be around 7,000.

Boost for Small Business    

In a country whose economic woes are well documented, this initiative provides a vital lifeline to Barcelona’s small and medium sized organisations. CityMart claim that 98 per cent of all ‘open procurement’ projects listed on it’s website are awarded to small and medium sized organisations.

This is a significant contrast to traditional public procurement tendering practices; where long lists of specifications and pre-requisites along with protracted contract award cycles, rule out all but the largest and most established suppliers from winning public contracts.

When you consider that city and community spending globally accounts for $45 USD trillion a year (yes that’s right…TRILLION!), you begin to get an understanding of the impact this sort of initiative could have for small businesses across the world.

An Engaged Community

It’s not just small business that benefits from the new model Barcelona has implemented. The project is making huge progress in improving community engagement. The city defines its problems in conjunction with its citizens, encourages these citizens to suggest solutions, and then uses tax payer funds to provide a work space from where these problems can be solved.

If that’s not effective community engagement, we don’t know what is. The project’s tagline is ‘Open for business. Open for innovation’ and it certainly holds true.

While opening a city’s problems up to the public certainly encourages innovation, community engagement, and supports small business, it’s important not to overlook the financial benefits these projects can create.

Global consultancy firm McKinsey has estimated that city governments can reap savings of up to 10 per cent by opening up procurement contracts and leveraging innovative community based problems solving.

Don’t tell your suppliers specifications…ask them for solutions

All procurement teams can learn something from the work that is happening in Barcelona. Procurement professionals could all benefit from being a little less prescriptive in telling suppliers what it is they want. The power is in admitting that these teams alone can’t possibly come up with the best solution to every business problem they face.

But how can professionals possibly know what they want when they don’t know what’s out there? By admitting their ignorance and opening up problems to more people, it is possible to leverage the vast creativity and innovative power that lies within communities.

So move your discussions away from specifications and prescriptive statements of work, be more creative and stop telling people what you want and start asking for solutions.

Passion from the Podium – 7 Speaking Tips for Procurement Pros

Apparently, the old underwear trick doesn’t work anymore.

Tania-CPO-Forum-14May14

Last year my son confided in me his nervousness about making a speech at his school assembly. I shared the old tip “pretend they’re all wearing just their underwear”. He replied, “Mum, that’s even scarier!”

And he’s probably right!

Public speaking is one of the most terrifying prospects we mortals face.

In my experience, there are just a few essential ingredients to becoming a screaming success on the stage. Here are my top public speaking tips for procurement professionals.

1. Talk about what you love – A lesson I learnt very early in my career was to only talk on topics you really know well, are comfortable with, and – ideally -passionate about.

Let me return to my (then) 8-year-old son’s school assembly presentation. He insisted that his topic was “Piranhaconda” (which, in case you missed it, is the sequel to the much better known “Sharktopus”). Both are B-grade (at best) movies that involve a lot of terribly clichéd, semi-clad, screaming women and tough guys with guns/missiles. Get the picture?

At the risk of being personally embarrassed at his selected topic for this highly competitive, academic audience, I encouraged him to talk about what he loved…(a movie about crazy hybrid animals) and he did a sterling job. Barely referring to his notes, he spoke with passion and was rewarded with a glowing review in the weekly newsletter (phew!).

My point here is, that no matter what your topic, if you talk about something you know and love, you are going to do a much better job. Your audience will be so much more appreciative if they feel passion coming from the podium.

So, spare the time to really think about your topic. Uncover and share where your real enjoyment is generated from. It may not be the technical details of your new eProcurement system or contract management process, but more about how you managed your team, and managed the change.

2. Also talk about the BAD stuff – A stalwart of my inner-circle procurement community is Santos’ CPO, David Henchliffe. He’s always encouraging The Faculty’s Roundtable members to share “when things go wrong”.

The quote “we learn from our mistakes” could not be truer. A mistake shared is a community lesson learnt. Everyone benefits. Sharing your failures also supports your authenticity as a leader. If you can show your vulnerability and humility you become a lot more accessible to people. Plus, let’s face it – nobody’s ever going to believe that your project/learning process was as perfect as some presenter would have us believe.

Tell your audience you overcame adversity – tell them how your number one supporter stabbed you in the back, tell them how your funding floundered, complain about moving goal posts, how your supplier stalled at the gate – your audience will love it! Why? Because (of course) this is their world too!

3. Write it down. That’s right – commit the whole darn thing to paper or screen! Why? Because it’s the only way you can guarantee you have really worked through your thinking. Many years ago, I remember hopping onto the stage with my dot points, confident in my subject matter, only to make a less than optimum impression when I ‘um-ed’ and ‘ah-ed’, circled back on previous points, and then took 200 words to say what I could have said in 20.

Writing out your whole speech gives you the opportunity to really think through your structure and how you want to effectively make your points. You can make your dot points from there and throw all the detail away once you’re clear about your speech.

Of course, the other MAJOR advantage of committing your thoughts to paper is that you can then fashion it into a blog, post it immediately on the day of your speech (ideally – exclusively on Procurious!), and encourage people who connect with or follow you to read and reflect on your thoughts. In this way, not only are you communicating to those in the audience, but you are also ‘amplifying’ your views through social media. A very nice ROI on your time!

4. Jettison the Jargon – Like you, I have sat through way too many procurement presentations that are strikingly similar in both their content and delivery. If we are going to individually and collectively ‘spice it up’ and enthuse our profession, we need to create a bit of a stir with our language and choice of vocabulary.

Why?

Because people stop listening when they hear repetition. You need to keep them listening by using different words and terms that make them think about what you are saying.

5. Make it Visual – Story-telling is now a well-accepted formula for successfully communicating a message. Use it! Kill the PowerPoint – it sends your audience into a semi-comatose state where they are more focussed on the timing of your next slide change, than what you’re actually saying. Use emotive and unusual photographs and infographics (that people can read from the back of the room).

6. Practice, Practice, Practice – I was surprised to read in the book “Talk like Ted” that the best Ted Talkers have rehearsed their speeches up to 200 times. They practise with friends, colleagues, anyone who will listen. And it’s not just about delivery, it’s about fine-tuning the words they use and simplifying them as much as possible to gain clarity. They write and re-write their presentations to ensure they are communicating what they really mean.

7. Make it quick – “Talk like Ted” also insists that speeches should be specifically 18 minutes only! Apparently that’s the magic number for giving your audience enough, but not too much, information! Audiences today are growing more and more used to the sound bite. Leave your audience wanting more, rather than being bored and switching off.

So there it is! Good luck with your next speaking engagement – I look forward to feeling the passion coming from the podium!

5 Things You Need to Know About Working in Germany

When you think of Germany, pretzels, beer and BMWs are common stereotypes that come to mind. But there is much more to Deutschland than that – especially if you are planning to work.

A country built on research, innovation and its ability to attract foreign direct investment (FDI), with the biggest economy in Europe and the fourth largest in the world – who wouldn’t want the opportunity to work in Germany?

Not only home to many of the European and Worldwide market leaders, recent figures show more than 45,000 foreign companies are also conducting business there. Although many more factors have helped shape German industry, this structure has consequently had deep impacts on the Procurement (Beschaffung) role.

The Need to Know

Procurious founder, Tania Seary, recently had the opportunity to meet the leadership team from the German Association of Materials Management, Purchasing and Logistics (BME) in Frankfurt. BME have established themselves as a professional association for buyers and logistics, supporting members in developing new markets and the configuration of economic processes.

According to BME, there are more than 100,000 procurement professionals working in Germany, so here’s what you need to know if you’re looking to join them:

  1. Germans can be considered the masters of planning

Doing business in Germany without adequate cross-cultural awareness is a risky proposition, and businesses should ensure they carry with them an appreciation of both the business landscape and the culture. Hierarchy is highly valued in Germany, and there are often myriad procedures and policies which can slow things down, so having a bit of patience is crucial to the success of business negotiations.

The desire for orderliness spills over into the business life of Germans – surprises and humour are not welcome! According to the German Business Culture Guide, everything is carefully planned out and decided upon, with changes rarely occurring after an agreement is made.

  1. Get used to some straight talking

There are cultural differences at play. The German business culture is perhaps less instantaneous than in countries like the UK, and personal relationships that are developed slowly over time are seen as a more desirable way to do business. Don’t be surprised if you jump straight into business talk, as there is little time for small talk.

  1. A series of villages, not really a country

Germany is a country with a long history and vast cultural differences throughout. For a country of its size (only 357,000km² – Australia is 21 times bigger), it has 16 states and over 400 districts.

This means you’re going to need to recognise the contrasts across the country, especially as industry is fragmented and big companies operate often in small villages. Although complex, this presents a fantastic opportunity to learn how to work with, and understand, different cultures – a brilliant training ground for future leaders.

  1. If you’re a social media nut – this is a different landscape

By sheer numbers, social media is as popular here as the rest of the world. According to the EU’s “Passport to Trade” more than 75 per cent of all Germans over 14 years of age use the Internet in some way, and 90 per cent of 14 to 29 year olds are on social media.

What is different about social media in Germany is the popularity of the local, German-only networks, in addition to the global players. The most popular networks listed according to their number of users are (get ready – you may not have even heard of some of these):

  • Facebook
  • Google+
  • Xing
  • Wer-kennt-wen
  • MeinVZ/StudyVZ
  • LinkedIn
  • MySpace
  • Lokalisten.

Up until 2009, there were up to 15 million German-speaking users on a German language network resembling Facebook called StudiVZ. But Facebook eventually conquered Germany (as it has for most of the world), as it enabled users to socialise and interact with people outside Germany too.

There is a Russian joke that says:  “Twitter can’t be popular in Germany, because 140 characters are basically two words in German.”  There are certainly enough short words to compose tweets in German, but when you read that only 10 per cent of Germans use Twitter, it makes you think there might be some truth to that joke.

With words like “kraftfahrzeughaftpflichtversicherung” meaning ‘car liability insurance’, and “donaudampfschifffahrtsgesellschaftskapitaenswitwe” meaning ‘widow of a Danube steamboat company captain’, let’s hope Twitter changes to a 15,000-character limit soon!

  1. And your role in procurement…

Procurement is not the only function of choice – it’s one of hundreds – and, if you’re coming from a large multinational corporation, a word you need to understand and add to your vocabulary is “Mittelstand”.

We often throw in terms like MNCs and SMEs (small and medium-sized enterprises) around when asked who your employer is, but statistically what is the real difference?

Statistically, any business with fewer than 500 employees is classed as an SME. However, in Germany this would mean that 99 per cent of businesses would fall into this category.

So the Germans created the world “Mittelstand”, which can refers to both SMEs and much larger companies, if they are run in the same spirit. This typically means the owner or owners take business decisions largely on their own, but retain close ties with both the business and the employees.

This involvement with the business applies to over 3.6 million “Mittelstand” companies, providing more than 60 per cent of all jobs in Germany, and making up 53 per cent of the country’s GDP. So the chances are you’ve already conducted business with a potential employer.

There you have it – some top tips for working and doing business in Germany. And if you’re looking for a job there, or plan on working there in the future, good luck (or as the Germans say…viel Glück!)


Useful links:

Germany Job Seeker Visa

Working in Germany: Getting a German Work Permit

EU Blue Card Germany