And if that isn’t enough to entice you to watch along, we’ll leave the final words to those from some past events.
Big Ideas Sydney 2018 – Live from the sidelines
Question: What does it take to be an influencer in an organisation?
Big Ideas Chicago 2019
Question: What’s the most exciting social or environmental change you’ve been able to drive in your career?
Have we enticed you enough already?
If you’re ready to hear Woodward’s electrifying keynote speech plus much more then register here now.
The let us do the leg work while you gather intel and new ways of
thinking to drive your business forward this year.
Make 2020 the year of the new idea. We are.
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Negotiating your salary can be scary… but not doing so can be an even bigger risk and really add up over time.
Money. We all might agree that it doesn’t buy happiness at work and it’s far from the most important benefit in our jobs, but still, it’s a big indicator of the value we bring. And while as procurement professionals, we’re more than happy to put on our poker face, sit at the negotiating table and secure the best deal for our business, many of us are less inclined to employ these tactics when it comes to our own pay rises.
Negotiating for ourselves is challenging, and research shows an incredible two-thirds of us never do it. In a perfect world, we wouldn’t have to – our hard work and effort would be automatically rewarded. But our jobs, just like our supplier negotiations, are about business, so it follows that we’d need to regularly present our business case to secure the best deal.
Doing so can be scary, but not doing so can be even scarier and over time, really add up. An example: a study conducted by Linda Babcock showed that only 7% of women attempt to negotiate their salary, as opposed to 57% of men. Over a career, this can make a huge difference – the same research showed that people who asked were able to increase their salary by over 7%.
But even if we know we should be negotiating for ourselves, doing so can be a completely different beast. So if you want to increase your procurement salary this year, here’s how we recommend you do it:
Step 1: Beforehand – Thoroughly prepare
A salary negotiation is like any other big-ticket negotiation in your procurement career and as such, you need to be prepared. Although salary can feel very personal, when you’re preparing you need to keep it professional and build a business case for what you’re going to ask for. Here’s how you do that:
Understand your market value
Before you enter any negotiations, you need to know your numbers, and salaries are no different. But where do you get this information from?
Websites such as Payscale can be a great starting point when it comes to salary ranges. It can also be extremely helpful to talk to specialist procurement recruiters, such as those from Procurious’ recruitment partner, The Source, to understand what your market rate should be.
After you’ve researched your range, land on exact value, ideally at the top end of the range. Why? Research shows that if you do this, you’re scientifically more likely to get closer to this amount, and when you select a number at the top of the range, you give yourself more room to negotiate.
Once you’ve discovered your market rate, think about what you’d like to ask for as an entire package, in case the business simply isn’t able to afford the raise you’re asking for (or equally, if you value other benefits just as much). Perhaps you’d like to negotiate for more annual leave? Different flexible work conditions? Travel or different projects? Ensure you know what you’re after and have prioritised it according to your preferences.
The last part of knowing what you’re after is considering the ‘bare minimum’ you’d accept. If you can’t get a raise, will you be ok to accept the changed benefits you’re asking for? Is nothing an acceptable outcome, as long as you know you can try again next year? Deciding on your ‘bare minimum’ can help you know when to acquiesce your negotiations.
Prepare your business case
Now you’re clear on your value, it’s time to show it through preparing your business case. Many people make the mistake of defaulting to their personal circumstances or effort expounded in their business cases, but you should always focus on purely business outcomes and results.
Your business case needn’t be long, in fact, it could be simply one page, but on it you should include:
Your accomplishments, focusing on the value you added vis-a-vis the strategic priorities of your department (and even the business as a whole)
Any awards or other recognition you’ve received
Customer, stakeholder or co-worker testimonials (if you don’t have any of these, ensure you proactively ask for some).
A plan to achieve future objectives of the business and department.
Once you’ve put together your business case, practice your pitch. Know inside-out how you’re adding value, and be prepared to answer any questions your manager might have (without getting defensive). Confidence will be a big part of your success, so practice definitely makes perfect.
Get your timing right (if you can)
Some companies mandate that salary negotiations and performance reviews go hand-in-hand. But from an HR perspective, there is always room for ‘out-of-cycle’ pay rises where they’re deemed necessary, so if possible, try to pick your timing when you’re negotiating. According to the Harvard Business Review, the best time to negotiate for a rise may be three to four months prior to your performance review, before your boss has decided what rises might be given out (NB. Team salaries often come from the same budget ‘bucket’ so getting in ahead of time might ensure there’s more available for you).
The first rule of picking your timing is choosing a time, obviously, when your boss isn’t stressed or where you don’t have thousands of impending deadlines. Beyond this, research shows that you should choose a Thursday or Friday to negotiate, as in this part of the week people are usually more amenable to negotiation and compromise.
Step 2: The meeting – put your best negotiation skills on
Remember the nerves you felt in your first supplier negotiation? Undoubtedly, you’ll feel those one-hundred fold when negotiating for yourself. As such, consciously employ these tactics to ensure you present your best pitch:
Get your confidence on
Some people think of confidence as something you do – or don’t – have, but in reality there’s lots of things you can do to make sure you look and feel more confident.
One such thing is to employ what Harvard researcher Amy Cuddy calls a ‘power pose.’ A ‘power pose is where you stand tall with your hands on your hips and your chin and chest raised. Executing one of these, even if it’s in your office prior to your negotiation, helps raise testosterone, which in turn increases confidence and reduces stress.
You can also make sure you look and feel the part, says self-improvement researcher James Clear. To do so, choose an outfit that makes you feel your best, and make sure you enter the negotiation room with your head held high, eye contact and a confident smile. ‘The way you enter a room can dictate how the rest of an interaction will be,’ James asserts.
As you’d know from your supplier negotiations, you’re always in the best position when you’re armed with as much information as possible. Likewise, as counterintuitive as might seem, the first thing you need to do in your salary negotiation is to listen.
What have our key successes been, you might ask. Or alternatively, what’s the road map for the future and how will be measure our success? The answers to these questions may well cause you to adjust your pitch, depending on what your manager highlights as their most crucial priorities.
Now you’ve listened, it’s time for your pitch. When you’re discussing your achievements, keep everything professional and fact-based, referencing your business case as needed.
Use your pitch to present your ‘first preference,’ whether this simply be a pay rise or a combination of pay and other conditions. Don’t mention other options as yet – these are for later down the track if negotiations don’t go as planned. Also take care not to mention anything non-business related, as relevant as it may seem (for example, I need a raise as my rent has increased, or I need a raise because I learnt my colleague who doesn’t work half as hard earns more). Mentioning personal reasons for a pay rise will distract from the value you add to the business, which is what your salary is fundamentally about.
Step 3: The big ask – will you get the pay rise?
Once you’ve prepared to ask for your pay rise and presented your case, your work is almost done. But there’s still the hardest part – actually asking for the raise. How do you do that? Here’s some tips:
Skirting around the topic, waiting to be asked for a number, or putting too many words into your request can all, unfortunately, be a sign you lack confidence in what you’re asking. The best way to ask for a raise is simply to ask, referencing everything you’ve presented. Try something along the lines of:
‘Based on the evidence I’ve presented here today, including the research I did on market range, I’d like to request a pay rise to XX.’
Be positive, not pushy
If the first response you get isn’t a straight yes (it almost never will be), you need to resist the urge to sound pushy, beg, or get offended or defensive. If the initial response to your request isn’t positive, ensure that stay positive and continue to lead with the value you’ve added. If you manager wants to dispute or further investigate anything you’ve presented, simply say that you’re happy to provide further evidence.
This is especially important if you feel yourself getting emotional. Even if you have further evidence at hand, it may be better to present it at a later point when you’re feeling more composed.
Send evidence via email
From an HR perspective, it’s unlikely that even if your boss agrees with your request in principle, he or she will be able to approve it straight away. Also, he or she may need to provide evidence to senior management or HR as to why the decision is being made.
To get on the front foot with this, send your manager an email after your meeting, detailing your request and your business case. Ensure you give your manager a deadline for responding, so you’ll know either way how to move the negotiations forward, if need be.
Step 4: Dealing with a no
When we enter a negotiation, the last thing we want is to receive is a ‘no.’ Yet at the same time, we do need to prepare for this as a possible outcome. Here’s how you do that while maintaining your professionalism and your job (if that’s your intention):
See no as a path to yes
When it comes to salary negotiations, it can be tempting to see a ‘no’ as a personal indictment on your performance, but according to Forbes, it’s anything but this:
‘We’re often reluctant to negotiate past no, but we shouldn’t be. After all, it’s not really a negotiation if we’re asking for something our bargaining partner wants.’
‘Negotiation is a conversation whose goal is to reach an agreement with someone whose interests are not perfectly aligned with yours.’
If we wanted something from our supplier, would we take no as an answer? Probably not. Employ that same ethos in your salary negotiations.
Make a counter offer
The beauty of having pre-considered options for your negotiation means that if you get a no to your first request, you can proceed down the list. If you need to do this, continue to lead with value and sell the reasons why the benefits you’re asking for are beneficial to the business, for example, ‘Working a compressed working week has been shown to boost productivity, and I’m confident, given my track record, I can deliver that.’
Keep the conversation open
Did you know that some of the world’s most famous negotiations took years, and even decades to pull off? While you’re unlikely to want to wait that long for a pay rise, know that it might take some time to achieve what you’re asking for. Stay positive, make SMART goals (for example, I’d like to discuss this again in 6 months, when I’ve done XYZ) and continue building your business case.
Have you tried to negotiate your salary? Any other tips for success? We’d love to hear them – please let us know in the comments below.
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We looked in an earlier
blog at the benefits for large businesses of working with start-ups and
SMEs and how procurement could make a successful connection. Here we investigate
why procurement often has difficulties with small businesses and examine SME-friendly
procurement practices already in use in pioneering organisations.
Procurement doesn’t engage well with start-ups – why?
often gets in the way of establishing good relationships with innovative
seeking the next start-up to rejuvenate their business models are running
innovation labs and incubators. Often, suppliers participate in the incubators.
But the initiatives are rarely owned by procurement.
In fact, procurement
often plays the bad-cop role, creating barriers to the onboarding of new and
innovative suppliers, asking for endless compliance documents, ending the magic
of the incubation.
Why does this
happen? Procurement has expertise in the supplier market. Isn’t it the team best-placed
in an organisation to unearth innovative gems?
is that not all partnerships with start-ups go through the typical customer-supplier
relationship. They might come in other
forms like a joint venture, an equity investment or a licensing
agreement. And these are traditionally not procurement’s area of expertise.
They typically involve other teams from finance.
According to a survey
by KPMG, collaborations involving equity (joint ventures, equity investments,
acquisitions, etc.) comprise 40% of total collaborations. Customer-supplier
relationships comprise only 24% and licensing 19% of the total. Therefore, it’s
understandable that procurement does not take the lead in all cases.
But procurement remains
an asset. It has a key role in identifying potential targets. What’s more, in
those 24% of cases procurement should be on top of the customer-supplier
partnerships with start-ups. That is largely not the case.
I can think of
at least 3 reasons why.
3 reasons why procurement does not approach startup collaboration well
For one thing, procurement
is often not sufficiently aligned with
its company’s business. It lacks the understanding to find the next
start-up or innovation to accelerate business.
relevant partnerships, procurement must grasp its company’s challenges and its future
areas of development. It needs to get a broader view. It needs to see beyond
the often narrow procurement lens.
This kind of
mindset must be instilled by the Chief Procurement Officers themselves – even
though business curiosity remains everyone’s duty. This is actually one of the
main recommendations produced by Forrester in its Q1 2019 survey
about the keys to a successful procurement transformation.
often lacks the time and resources
to perform these tasks.
are too often consumed in labour-intensive activity that has lower added value
– like gathering data from scattered legacy systems.
This is where
having a powerful digital procurement platform that automates processes and enables
actionable analytics is key. You free resources for new value-added tasks.
With such a
tool, you could even afford to have somebody specifically in charge of supplier-enabled
A third and more general problem is that procurement processes are not designed to work effectively with new start-ups.
They tend to
favour larger companies, especially under the dependency criteria or volume
Let’s dig into
this aspect of things.
Time frame. To start with, procurement and start-ups work within different time frames.
For start-ups, typical
procurement qualification processes take too long. They often require browsing
many documents, answering hundreds of questions and attaching several justification
often face these obligations before they know about the type of partnership and
the benefits that are expected.
On the other
hand, decision-making about a qualification process or a purchase order is too
slow. Start-ups expect answers in days, not weeks.
Resources. Resources are scarce in start-ups.
employees often have many functions. They find it very time-consuming to deal
with complex organisations with numerous specialised points of contact – one for bidding, one for contracting, one for ordering,
one for invoicing, etc.
They want access
to the real decision-maker.
cannot change a company’s complex organisation. However, it can define a single
point of entry for start-ups: a person with a strong internal network in the organisation,
a deep understanding of the organisational maze and the ability to grasp the
particular challenges start-ups face – and how to solve them.
declarations. A supplier wanting to work with a large
company typically has to pass several checks and tests.
This process is designed
with bigger organisations in mind. The process includes checking dependency
criteria, environmental charters, ethical declaration, quality labels and so
here is: start simple. Use a non-disclosure agreement to ensure confidentiality,
a letter of intent to ensure motivation and some intellectual property (IP)
general rules in case any IP is built jointly.
Invoices. The main concern for start-ups about procurement processes is invoice payment.
are often slow at paying supplier invoices. But cash is a matter of survival
This is a
critical point in collaboration. Start-ups would rather get less money but get
This means that
a company with an efficient source-to-pay process will definitely have a
competitive advantage over its peers when it comes to working with innovative
Good procurement practices already in use that are helping start-ups.
Here are good
practices already implemented by some best-in-class procurement departments.
First, they have
opened a gate for start-ups. Several procurement departments have created a
dedicated start-up portal based on the Source-to-Pay solution they use. Some have
even interfaced it with public start-up portals.
Second, they have adapted the contracting process to focus only on the essentials of a start-up collaboration. They avoid sending a hundred pages of standard contractual documents at an early stage.
For example, the
process could evolve along with the incubation stages of the target that have
been defined – for instance a non-disclosure agreement for ‘discovery’, data
protection clauses for ‘incubating’ and proof of concept with formal
description for ‘pilot’.
Third, they have
speeded up decision-making. They have
implemented shorter approval workflows for interactions with start-ups: contracts,
orders, invoice and payment processing.
Next, they have
set up accelerated payment terms. Making these the default for start-ups is a
major part of speeding up the payment process.
Finally, they have appointed a dedicated contact person. She or he facilitates start-ups’ interactions with the organisation.
So it’s well worth considering why your procurement department may be struggling to interact well with SMEs and start-ups. And looking at the SME-friendly practices already in use in some organisations can provide key inspiration for changes you can make.
For this reason we will take a more detailed look in part 2 of this blog at use cases from pioneering large companies.
For more information on how Ivalua can help you work better with SMEs, go to ivalua.com
Tomorrow happens to be ‘Fun at work’ day, so get in the mood with these 5 tips…
Work struggles can be real. Whether it’s a toxic work environment, a terrible boss, an annoying colleague or menial, soul-destroying tasks, there are times when we find our vibe is far from flying high.
How can you begin to turn the tables and take control back?
Following these 5 tips will help you live your best (work) life.
1. Ask what drives you
Understanding your career drivers can help to work out what you can change in your current position. Or to unlock what you could be doing instead.
If you want to change your current situation or outlook, then first you need to understand yourself.
Can we use the disruptive model pioneered by Amazon, Uber and Airbnb in the struggle against climate change?
Uber is the world’s biggest taxi company, but doesn’t own a single taxi cab. Airbnb and Booking.com are the world’s largest hoteliers, but don’t possess any hotels.
And after being in business for a quarter of a century, Amazon – the world’s biggest bookseller – is only now experimenting with physical bookshops.
There are many lessons to be learnt from such examples. Chief among them, perhaps, is that being disruptive does work.
These days, businesses and consumers are far more receptive to ‘early-stage’ disruptive ideas. They have seen for themselves how easy it is to be overtaken and left behind by clever ideas whose time has come.
I’ve been thinking a lot about disruptive ideas in recent weeks. And in particular, I’ve been thinking about disruptive ideas in the context of sustainability.
And the conclusion I’ve come to?
We may need some fresh disruptive ideas and business models if the sustainability agenda is to make much more progress.
That may sound mad. Since – say – the 1970s and 1980s, the world’s environmental protection initiatives have made huge progress.
Sustainability is high on both corporate and government agendas. Cars are far more fuel-efficient. Houses, offices and factories are far more energy-efficient.
Skies are clearer, water cleaner – especially in the developed world, although progress is being made elsewhere, too.
And yet, and yet. Waters are clearer, yes. But visible pollution has been replaced with microplastic fibres.
Smoke from coal-burning has gone from our skies. Yet CO2 emissions are at record levels. The Amazon’s rainforests are vanishing. Sea levels are rising. And average temperatures are increasing.
Is it any wonder that groups such as Extinction Rebellion are protesting so vociferously? Or that the activism of teenage protesters is so widely applauded?
For me, personally, one of the most persuasive signs that current approaches to sustainability aren’t delivering fast enough has come from the Harvard Business Review.
Late last year, influential management thinker John Elkington took to its pages to officially ‘recall’ – that is, take back – a concept he first launched 25 years ago: the Triple Bottom Line.
Simply put, he argued, the Triple Bottom Line was no longer enough. Something else was needed. Something bolder.
The idea behind the Triple Bottom Line was simple. Instead of focusing on just profit, the Triple Bottom Line sought to get businesses to view their performance in a broader context.
They should examine their social, environmental and economic impact.
The idea has had a powerful effect. Twenty-five years on, it’s made a big difference.
But it isn’t enough, acknowledged Elkington. Too many businesses see it as a trade-off mechanism, rather than as an absolute test.
Something else is required if we are to really ‘shift the needle’.
As he eloquently put it: ‘We have a hard‑wired cultural problem in business, finance and markets. Whereas CEOs, CFOs and other corporate leaders move heaven and earth to ensure that they hit their profit targets, the same is very rarely true of their people and planet targets.’
The ugly side of fashion
Which is why I’ve been thinking about disruptive ideas, and alternative business models.
Could they do enough to ‘shift the needle’?
I’m excited about their potential, to be sure.
Take the fashion industry. It’s been described as the second-most polluting industry in the world.
In water-scarce countries, water goes to produce cotton, not food. Microplastics from synthetic textiles fill our rivers and oceans.
According to the United Nations, the fashion industry consumes more energy than the aviation and shipping industries combined. It is responsible for up to 20% of global wastewater, and 10% of global carbon emissions.
Container ships full of cheap clothes ply the world’s shipping lanes. They belch out vast amounts of the sulphur-laden black smoke that comes from burning bunker oil, the world’s dirtiest fuel.
And yet, at the end of it all, a lot of ‘fast fashion’ simply gets thrown away. The UK sent around 300,000 tons of clothing to landfill in 2016, for instance.
What can be done?
Instinctively, most people think about some form of clothes recycling. But they are forced to conclude that the technology to cost-effectively turn unwanted clothing into useable yarn doesn’t yet exist.
But there’s another form of clothes recycling that doesn’t need technology. Or rather, the technology that it needs is already developed and with us.
The sharing economy
I’m talking about clothing rental, which is catching on fast.
Names such as Girl Meets Dress, My Wardrobe HQ, By Rotation, Rent the Runway.
These and others are offering affordable clothing rental services, either on their own account (they own the clothes), or as intermediaries (other people own the clothes).
At the moment, a lot of the activity is at the high end, in designerwear. Fast fashion it isn’t – yet.
That said, there are experiments underway. H&M, for instance, is trialling a rental scheme at its flagship store in Stockholm. In the United States, Banana Republic has recently launched a rental service.
Even so, it’s clear that what’s going on has the potential to evolve and grow.
As a business model, it’s different and disruptive. And it addresses many of the sustainability issues of the traditional ownership model.
Instead of being hung up in a wardrobe, clothes are worn again and again – just by different people.
So could such a model ‘shift the needle’ in terms of fashion’s impact on the environment?
No one, including me, yet knows: it’s far too soon. Right now, fashion rental is far from becoming mainstream.
But don’t forget: so too, once, were Uber, Amazon and Airbnb.
Disrupting accepted business models in fashion – and other areas – could really help in the struggle to combat climate change.
This article was written by London Roundtable attendee, Omera Khan. If you are also interested in attending our next Roundtable in London, you can contact [email protected]
your heart is broken, how hard is it to turn up to work every day and perform?
so many of us have to do it every day. Our worlds may have fallen apart – the
loss of a loved one, a falling out with a friend or colleague, the loss of
money or an important opportunity – yet each day we drag ourselves to the front
door, put on a mask and carry on doing our jobs with a smiley face, but a
that’s kind of what I’ve been doing every day since my mother passed away eight
worry, I’m fine, and I’ll explain, but I’m just saying – I understand.
feel your pain.
When I found out the clock was ticking
For me, bad news often seems to arrive at the most inconvenient time for my professional life. We knew that Mum was gravely ill, but the final news that Mum only had months to live arrived at the start of a one-month business trip I had in the US last September.
had just arrived in San Francisco. The
news came in the middle of the night (the joy of timezones) and I just cried
one of my favourite speakers (and human beings on the planet), Nicky Abdinor
says, always be grateful. Even if you
have the worst day ever, you can go to bed and be grateful that the horrible
day is over. You can click ‘control,
alt, delete’ and re-boot for tomorrow.
had a lot of days like that during those four long weeks on the road in the US. When I got home, I was fortunately able to
spend two months by Mum’s side.
How much should we talk about our broken hearts?
are human, and that means we are emotional.
But our modern workplaces and our community expects (and rightly so)
that we will conduct ourselves with a certain level of decorum, and if we want
to keep our jobs and our places in the community we have to play by the rules.
I worry that companies almost expect us to behave like robots (as I have said
previously in my “Beat the Bots” speeches). They expect us to do things such as
re-enter the workforce after having a child or losing a loved one and act like
it never happened.
that’s not really what being a human is about.
only are we required by our companies to behave in a certain way, but we also
need to keep participating in work, as well as in life. This isn’t only because
we’ve got bills to pay and we need to eat; it’s more than that – participation
and doing ‘normal’ things are an important part of overcoming grief.
still, it’s hard. Sometimes, so very hard. But how do we get through these
times of grief and trauma without totally embarrassing ourselves, tainting our
hard-earned reputations and maybe even losing our jobs and family?
Juggling through work and life
As I’ve written
previously, we have to somehow find a way to keep all the juggling balls in the
air, with the balls being work, family, health etc. But the important thing to
know is that some balls are made of rubber, whereas others are glass. Work is a
rubber ball, so if you drop it, it will bounce back, but others, like your
health and family, are glass. If you drop them, they are difficult to recover.
raising my family and supporting my mother’s health, I have had to drop the
work ball many times – and believe me, it has always bounced back.
How to keep juggling after a glass ball drops to the floor
am so fortunate to work with such an amazing group of colleagues, many of whom
have been working with me throughout Mum’s illness. They are all superstars and many stepped in
to take accountability when I had to focus on family.
I’m so grateful I have my team, this experience has reinforced what I knew all
along: if we are going to be successful leaders, we need to be resilient and
work our way through grief and disruption. This is for ourselves personally but
also for our team – if my team is distressed because I’m distressed, then not
only does my personal life fall apart, but so does my professional life.
you find yourself in a distressing situation, my advice would be to share with
your team (but not too much). They need to understand what you’re going
through; they need to see that you’re human and vulnerable. Yet at the same
time, you’re probably best placed to save them the intimate details. At the end
of the day, it is your family and friends whom you need to lean on in personal
times of crisis.
tough situations, remember to take it one step at a time and draw energy and
support from those closest to you.
Understanding what is really happening under your peers’ mask
My mother had dementia, as I’m sure many of you
know. As such, there were lots of things she couldn’t remember, like most
people’s names, what year it was, and even how old she was.
surprisingly, she could still remember her feelings at different points in her
may not remember someone’s name, but she can definitively (and accurately)
describe the emotions she associates with that person.
situation with Mum reminds me of the age-old leadership lesson:
People may not remember what you
said, but they will also remember how you made them feel.
we are all wearing our masks, we need to make an effort to understand our
peers, bosses and direct reports, and whether or not they may have some trauma
going on in their lives. Behaviour we
observe that might seem unusual, a lack of performance or a change in attitude
may be related to some grief they are experiencing, not just a competency issue
and their ability to do the job.
these situations, we need to use our super human ability to empathise. I know every time I experience a painful
event, it has made me more and more understanding of what others may be
experiencing and challenged with.
Working through a broken heart
Mum was always a huge supporter of my
professional development. When I
travelled or had a critical meeting I was nervous about, she would always say
‘Remember, I’m on your shoulder.’ And for the last few weeks, that’s where I
feel she’s been – right with me, all the way.
having Mum may have broken my heart, but it hasn’t broken my spirit. Late last
year, we worked hard across the US to garner support for Procurious’ 2020
program, and this year, I’m excited to say that our efforts were rewarded –
we’re on track for one of the biggest and most exciting years yet. Stopping now
to reflect on that, I know Mum would have been immensely proud.
now certainly isn’t the time to stop in any way, shape or form. To prosper in
this next Industrial Revolution, we need to play to our human strengths:
collaboration, connection, innovation and influence.
need to embrace our human-ness, and we need to get connected – to our team, to
our stakeholders, to our suppliers and to our community. The robots may be
coming, but the thing we have that they don’t is connection. Speaking of, get
onto Procurious now, and start making the
connections you’ll need to make your 2020 as successful as we hope ours will
We’d love to hear your stories of
career resilience – please share in the comments below.
There’s a poignant scene in The Lord of the Rings in which the Elven Queen Galadriel turns to Frodo Baggins, a frightened young hobbit, and gently reminds him that ‘even the smallest person can change the course of the future’.
Against all odds, and to the dismay of many powerful leaders in Middle-earth, Frodo is entrusted with the monumental task of destroying the One Ring within the fires of Mount Doom. His relentless determination, unorthodox methods and the faith of his closest friends all contribute to his ultimate success.
What can procurement take away from this? Most importantly, when it comes to selecting suppliers, size isn’t everything – something any one of the 30.2 million small businesses operating in the United States could tell you.
Traditionally, big works with big. But companies today are recognizing that they are selling themselves short by restricting their supply base to large organisations.
Benefits of working with SMEs and start-ups include:
Small businesses are more agile and innovative because they are less confined by rigid or bureaucratic processes.
Improved sustainability and added social value, which benefits the local economy. This is because SMEs are likely to have a good understanding of the community in which they operate.
Better value for money as a result of lower admin costs and increased flexibility.
Capacity to deliver highly specialised solutions.
Closer buyer-supplier relationships.
Increased efficiency in terms of product cycles and the provision of services.
Improved supplier diversity: 45% of US-based SMEs are minority-owned businesses.
Despite the many advantages, some procurement leaders remain wary of partnering with smaller businesses due to increased risks. Others simply struggle to effectively build and nurture these partnerships.
Here are my 4 tips for procurement to build successful relationships with SMEs and start-ups.
1. Build close relationships with your suppliers
One of the many benefits of working with smaller vendors is that it’s easier to build meaningful, lasting relationships – often directly with the CEO. These drive innovation, reduce cost and mitigate risk.
Procurement professionals should take advantage of this through regular communication and collaboration with suppliers, particularly in the pursuit of innovation.
Negotiations, contracting and pricing are a necessary (and important) part of any buyer-supplier relationship. But meeting your suppliers in person to seek innovations will drive value for your organisation.
In reality, you might be surprised at how much additional value a supplier can contribute when you abandon standard approaches to SRM and commit to listening and learning.
2. Pay your suppliers on time
According to a recent study, 11% of all invoices sent by SMEs are not paid on time, which comes at a cost of over $1 trillion each year. On top of this, the research found that 7.5% of all SME invoices are written off as bad debt.
SMEs are dependent on good cash flow. Many fail as a direct result of clients delaying payments. So paying your suppliers on time should be an absolute priority for procurement professionals.
In order to prioritise innovation and other benefits associated with SME partnerships, procurement teams must be willing to adapt their processes to be more accommodating.
Many corporations are accustomed to only dealing with other big companies. This leads to the assumption that only large suppliers are capable of meeting demands and managing risk.
In reality, as long as suppliers are financially secure and can deliver your requirements, your flexibility in accommodating them is the more important factor.
Procurement teams can do this by:
reducing contract complexity
limiting turnover thresholds and removing high insurance and health and safety requirements
sharing risk appropriately between buyer and supplier
keeping KPIs simple, concise and supportive.
4. Mitigate potential risks fairly
There’s no question that there are risks associated with working alongside SMEs and start-ups. But with careful consideration and forward planning, these can be mitigated. And without negative impacting prospective suppliers to a point where they are compelled to walk away.
For example, an SME might present a higher financial risk than a big supplier. These concerns can be alleviated by requiring financial due diligence and detailed discussions surrounding the company’s finances to ensure complete transparency.
Similarly, it’s worth asking for an overview of the supplier’s recent and ongoing projects, including a first right of refusal to buy the company should it go bankrupt. Commit to regular meetings and use incentives instead of penalties.
So, the next time you’re approached by an SME or start-up, don’t reject them on the assumption that they will be too small to meet the needs of your organisation.
Just like Frodo Baggins and the Fellowship of the Ring, an SME just might turn out to be the most valuable partnership you ever create.
Learn about the cost savings and other benefits involved in joining a Group Purchasing Organisation (GPO) at www.una.com.
Is procurement less, just as, or more important this decade than the last? Find out as we take a walk down memory lane…
It’s the dawn of a new decade in procurement, and goodness me, how things have changed. From the digitisation of just about everything, to the introduction of big data, 2020 looks vastly different than 2010 did.
As a former CPO and now Principal Advisor at Procurious, I’ve been at the coalface at what I can only describe as seismic changes to our profession.
But have all the changes we’ve seen been good changes? Are we now poised to deliver more value, or will we struggle to do more with less? And are we more relevant than ever, or is technology replacing us? Here are my key observations from the last decade – and what we need to do to stay valuable going forward:
We became captivated with compliance
The last decade started for me with a bang – I was promoted to a procurement leadership role and I was, for the first time in my career, excited to be able to effect real, lasting and meaningful change. I felt that procurement could achieve much more than pumping out stock-standard contracts and controlling third-party spend.
Yet my excitement was short-lived. As I looked around me, I found that, as a function, the procurement community just didn’t seem interested in broader, value-adding gains. Their focus was still quite shortsighted; they seemed captivated by processes and fixated on compliance. Cost-savings, contracts and the financial bottom line seemed to be the only thing on their mind.
Data made us better advisors (but some of us are still catching up)
‘Don’t ever do a job a machine can do,’ said our grandparents, as they rejoiced at the invention of the calculator. Suddenly, this advice was ringing true in our profession – we had eProcurement, cloud computing, and AI to take away a lot of our administrative work. What came in its place was the ability to deliver new and intriguing insights to our stakeholders quickly, without having to spend hours on Excel.
As emails replaced purchase order pads, eCatalogues replaced supplier brochures and the data started to flow through, we had the information to inform our strategies and priorities. As a result, our advice and cost savings rapidly improved.
Not everyone was a fan, though. Many of us became concerned with job stability, and some believed that technology had created more issues than it solved.
From cost reduction to value creation
As the decade progressed, our relentless focus on cost reduction started to feel like a grind, not least for suppliers who, feeling bullied by our negotiation techniques, began to speak out and cry ‘no more.’ These changes meant that the expectations of our stakeholders started to move away from a focus purely on cost.
The good news was that our newly automated processes helped us to shift our attention from cost-savings to value creation. Before we knew it, we’d automated our entire P2P process, freeing us up to build strategic partnerships with both our suppliers and stakeholders.
In uncertain business and economic times, the focus on value creation was exactly what our profession needed. It lifted us from a ‘necessary evil’ in some people’s eyes to a strategic partner. On the whole, though, that transformation is far from complete, and many of us still have some work to do in this regard.
It’s more about the people than ever
Behind the analysis, behind the processes, and behind the cost-savings, procurement has always been a people profession. And perhaps the best news of the decade is that with all the change, with all the uncertainty and with the new and heightened expectations, procurement professionals have shown themselves to be resilient, optimistic and future-focused.
We’ve embraced digital disruption. We’ve welcomed, with open arms, technology that makes us more efficient, and we’ve also onboarded stakeholders and suppliers to use that technology, meaning we’re adding even more value.
But we’ve also realised where technology stops and that is, sometimes, with communication. We now understand how critical our ‘soft skills’ are at work, and that technology can’t replace the influential conversations we need to have to convince an operational manager to change suppliers, or make a case to buy more sustainably. Technology is transformative, but then again, so is our ability to negotiate.
As for 2020 and beyond?
With digitisation and automation now happening at breakneck speed, many of us have embraced the change but fear what’s coming next. Soon, virtual assistants will abound, collaborative marketplaces will proliferate. What value will we add, then?
The answer is plenty. One thing we’ve learnt from the last decade is that in uncertain times, human relationships prevail, and that’s where our strength and expertise shine through. Armed with our best people skills, the sky is really the limit for procurement. As a function, 2020 and beyond could see us having more strategic influence than ever before.
What other changes have you seen in the last decade? Do you think that procurement is less, just as, or more important this decade than last? Tell us what you think in the comments below.
If you’re facing an annual pay review this month, follow these key Dos and Don’ts to boost your prospects
For many of us, our annual ‘appraisal’ when we discuss pay and performance is one of the few opportunities to talk really frankly and one-to-one with our line manager.
However, there is a tendency for pent-up frustrations to spill out.
All those extra hours you’ve put in for no extra pay. The fact that you suspect your colleagues are paid more than you.
The lack of training and development. Being overlooked for promotions. Doing the job of three people with no support.
This is your time to get everything off your chest, isn’t it?
Well, no. It is important to treat this like any other business negotiation.
So, keep it professional. Don’t get emotional. Prepare your pitch. Present your case. And have a back-up plan if you don’t get what you want.
First, some Don’ts. Avoid these common mistakes.
Don’t beg for more
Adopting the Oliver Twist approach (‘Please sir! Can I have some more?’) is just going to make your employer feel uncomfortable.
Saying you need a rise to cover the increase cost of fares or childcare or rent may gain you some sympathy. But it won’t get you a rise.
This is a negotiation about your value to the organisation – not the cost of living.
Don’t threaten to quit
Threaten to take a job elsewhere and you run the risk of your employer calling your bluff – so you better have a job lined up.
You will also come across as disloyal. And when there’s a promotion or new opportunity, your employer might overlook you for fear you are going to leave anyway.
However, you can point out that other employers are paying more as part of your pitch (see below). But stress you are really happy in your job and have no plans to move.
Don’t go compare – even if it’s not fair
Some firms actively discourage staff from discussing their pay with their colleagues. So if you ask around to check if your salary is on a par with everyone else’s or to find out what pay rise they received, you could be in for a disciplinary chat, rather than a talk about your prospects.
There are many reasons why people doing the same/similar jobs are paid differently – from performance to length of service.
Most people are not happy divulging what they earn, let alone revealing the details of why they are paid what they are paid.
Don’t lose your temper – it will make things worse
If you don’t get the answer you want, try to be understanding rather than angry. Your line manager may hate having to tell every member of the team that they won’t be getting much of a pay rise and it won’t help your case to make the process even more difficult.
Also, there may be a reason – poor performance, persistent lateness, or rudeness, perhaps – for a bad appraisal.
You need to address these issues, not antagonise your employer.
Now some Dos. Follow these tips to make things go well.
Do prepare a business case
Many employers fear that if they give one person an inflation-busting rise ‘everyone else will want one’. So give some compelling reasons why you, as an individual, deserve more by offering something in return.
Don’t just focus your past performance (what you’ve already contributed). You should also demonstrate how you can save/make your organisation money in the year ahead and bring more to the table.
For example, offer to take on a new project – saving your firm the cost of employing someone new or a reducing the need for hiring a contractor.
Do your research
As part of your pitch, you can (and should) use data to support your case. In turn, this can help your line manager to justify a pay rise with higher levels of management or HR.
However, instead of saying X earns more than me or Y had a bigger bonus, use the information that’s available publicly (if you can).
Medium and large employers must carry out an equal pay audit on a regular basis to ensure that they are complying with the law. If your salary seems out of line with what’s been published, you can use this information to present a case for better pay.
If your organisation does not have to publish pay data, then go online to salary comparison sites such as glassdoor.co.uk or indeed.co.uk to benchmark your pay.
Also, check job adverts for similar roles in similar organisations and print out the data to support your case. Once again, be professional. Say something like: ‘The going rate for my role is £X. I feel that bringing my pay in line will not only help me but also help attract other talented people to our organisation.’
Do make your firm an offer they can’t refuse
Most employees have a good idea about where there are skills gaps within their organisation. Offer to solve these.
You could say something along the lines of: ‘If I undertake this development programme/do this course I could take on the responsibility for X.’ You can then justify more pay through a promotion.
Do be prepared to listen
Your line manager will probably justify why you are only getting X% as a rise. Listen carefully.
It might be because the firm is going through a difficult time (perhaps it’s time to jump ship). Or perhaps your performance is not good enough – in which, case find out what you need to do to improve.
Do have a plan B for tomorrow
The bad news is that your line manager has probably already decided the size of your pay rise – or been given the figure by HR.
So whatever you say will not make a difference to your salary in the short term. However, you can use the review to ensure better pay and prospects in the future.
Think of all the things your employer can offer you that will boost your ‘value’ in the workplace and your long-term earning potential. These could include investment in your skills, the opportunity to work in a different office (or even a different country) and the chance to join a new team.
If none of the above are on the table, look at alternative ways to be rewarded such as more flexibility – for example, working from home one day a week.
Try to leave the meeting with something – even if it is an agreement to meet again in three months’ time to discuss your progress. If you feel more positive, so will your line manager who will probably be as relieved as you are that the chat went well. This will make your next meeting much easier (and hopefully more productive).
So if you have a pay review on the horizon bear these keys Dos and Don’ts in minds as you prepare for the meeting. You’ll give yourself the best chance of getting what you want.
And in case you need a little more advice on getting to the top in your career, don’t forget to tune in tomorrow to our free webinar – Don’t Quit Your Day Job. Register here.
The business case for diversity is clear – diverse teams and leaders are more innovative, collaborative, successful and profitable. But when it comes to diversity in leadership, we’re not where we need to be. How do we get there?
Procurement as a profession has proven our ability to change, to adapt and to thrive. From order takers, to expediters, to deal and market makers, we have proven we know how to make the most of an opportunity to create value, and we’ve been able to do so in ways never done before.
Yet to realise the true potential of our profession, there’s one thing I know we need to achieve that we haven’t as yet, and that is: gender equality in leadership.
Across the board, procurement performs above average from a gender perspective. A recent survey from our recruitment partners, The Source, revealed that 38% of leaders and managers in procurement are female (compared to the 30% average across all professions). This is a great start, but we’re still losing too many women along the way – when you look at entry statistics, 48% of procurement graduates are female.
If we’re doing well, then, why do better? Better diversity can help us better manage complexity and enhance profitability, as I’ll explain below. And in good news, there are (at least) five things you can do right now to help your team get there.
Why is increased diversity particularly important for procurement?
As Deloitte pointed out in their 2019 Chief Procurement Officer report, CPOs (and increasingly, all of us in procurement) have to be “complexity masters” to excel at work. As we know all too well, complexity is now coming in all shapes and sizes, including trade wars, climate change and new regulations (external complexities), stakeholder alignment (internal complexity), people, organisational models and business plans (talent complexity) and finally, digital disruption. Managing one aspect of this is challenging enough; managing all can feel overwhelming.
But greater diversity can help us do it all. Firstly, with diversity comes multiple perspectives and enhanced innovation, which will help us identify multiple solutions to solve the complex problems we face.
Diversity also helps us with everything inside our own four walls. The more diverse we are, the more likely we’ll represent the interests of those we serve, including our organisation’s customers – who are ultimately our customers. And not only do we represent our customers and stakeholders, we also better represent our own staff when we’re diverse, as we’re better able to understand them and make decisions that enhance their wellbeing.
Finally, and perhaps most importantly, given the expectation of strategic business partnering from procurement, diverse teams have been shown to be up to 35% more profitable. With procurement functions now often required to do more with less, diversity can be a key driver in increasing our value-add and securing resources to innovate and grow.
How to increase diversity in leadership in procurement
The challenges faced in retaining women in leadership in procurement echo those of wider society: inequality with paternity leave, unconscious bias and a lack of flexibility. But there’s so much we can do to counteract these, even on an individual level, and you don’t need to wait for society or even your organisation to catch up. If you want to reap the benefits of greater diversity in your team, try the following:
1. Give (public) praise
In order to reach a position of influence, you have to be noticed. And unfortunately, sometimes being noticed can be as much about announcing what you’re done as it can be about the actual achievement in the first place.
This can be particularly problematic for women, whom research shows can be punished for advocating for themselves. To counteract this, try giving public praise to women you believe deserve to get noticed. Whether it be on Procurious, LinkedIn, in a meeting or in front of an influential executive, giving praise can help someone be recognised and hopefully promoted.
Although this is a stereotype, there’s never any harm doing what you can to prevent it. So if you know a talented female and there’s a role going, why not encourage her to have a go?
3. Mentor and sponsor
Whether or not you’ve got diversity as an official target or KPI in your team, as a leader, you’re no doubt responsible for performance. Knowing that, it’s important that you mentor and sponsor other more junior procurement professionals – especially females.
Your mentoring can be any arrangement that suits you and the mentoree – you may want to meet regularly but informally or alternatively, you might put a more formal development plan in place. If you choose to be a ‘sponsor,’ though, you should be more active – as a sponsor, your responsibility is to specifically advocate for the person you’re working with in the hope of securing them a promotion (like giving public praise, but with a very specific end goal in mind!).
If you want to increase your impact, you could even mentor someone outside of your organisation. Procurious and The Faculty run mentoring programs in both the UK and Australia, get in touch if you’re interested.
4. Role model flexibility – regardless of your situation
If you’ve ever been in any type of leadership role, you’ll know that you can influence your people as much (or more) with your actions than with your words. One of the most important ways to influence your people is to show you trust them through giving them flexibility.
But if you’re in a position of influence, you can change this. No matter what your situation – mother, father, or non-parent, if you lead by example by both working flexibly and allowing it, you’ll help remove the stigma and as a result, help create better diversity.
5. Campaign for equal rights and equal opportunities
Although unconscious bias is still an issue, one of the biggest reasons that there are less women in leadership roles in organisations is that they have career breaks that their male counterparts may not have, by way of maternity leave(s).
But if you’re in a position of influence, you can change this by giving fathers a much sought-after opportunity to be at home. Numerous big companies have all recently removed the terms ‘primary and secondary carer’ and instead offered equal leave to all new parents. Why not advocate for this at your organisation?
In our profession, a lot can change in a year. So why not make this year the year we all rally together and create a change we can be proud of? Our profession is complex, but helping more women into leadership doesn’t need to be. Diversity benefits us all, so let’s all do what we can to help propel more women into leadership.
Tania Seary is the founder of Procurious and a passionate advocate for gender equality. If you’re interested to learn more about how to help women in leadership, tune in to our podcast ‘Don’t Quit Your Day Job – Your Path to the Top’ webinar on January 23rd, 2:30pm BST. Register for it here.