Tag Archives: covid-19

Happy At Home Alone? 5 Ways To Negotiate Your New Normal

Nine in ten of us do NOT want to go back ‘normal’ once lockdown ends. So how do procurement professionals negotiate a new WFH arrangement – that works for them and their employer?


With half the world in lockdown we are starting to get used to the ‘new normal’…. and after an initial reluctance, most of us are embracing the idea of a new way of life.

Yes, we do want some aspects of “normal” life to return. Being able to socialize, see our families, have a decent haircut (that’s not done at home) or enjoy a weekend at the beach.

But we don’t actually want to go back to life as it was.

A recent poll in the UK found that only 9 per cent of Britons want to return to life as “normal” after the end of lockdown.

One area where we are yearning for change is work … or more importantly the ability to work from home and/or more flexibly now that we have put the systems in place, mastered video conferencing and created our own home-office environments.

The good news is that three-quarters believe their manager trusts them to be productive when WFH according to research commissioned by Visier, which provides people-analytics to over 5,000 businesses that employee 7 million staff across 75 countries around the world.

So, if you are one of the 9 in 10 who wants a different type of working life, build on this trust: meet your deadlines, exceed expectations, continue to work collaboratively and show that you can excel at online meetings and conference calls. Do not give your manager any excuses to say WFH does not work – and that you have to return to your place of work, once offices are back open again.

The best way to tackle this negotiation is like any business negotiation (as a procurement professional you already have the skills). So be clear about what you want to achieve, build a compelling case and then make a persuasive argument.  

STEP 1: PROVE IT’S THE BEST WAY FORWARD

Seven in ten staff who are working remotely for the first time as a result of the Covid-19 crisis, felt they were either more or equally productive as a result (despite the unique challenges of slow internet speeds, homeschooling and hours queuing to purchase life’s necessities).

So, working from home does work. Just make sure you have the data to support your argument and include this information in your flexible working request. It will make it far harder for your line manager to refuse…and also help you prove to yourself that you CAN do this.

TIP: Make this data easy to assimilate by churning the figures – I wrote five more pitches every week, responded to 15% more enquiries per day, set up an online meeting with a new supplier and negotiated a contract remotely etc… It is much harder to argue with facts.

STEP 2: WHAT DO YOU REALLY WANT?

As with any negotiation, you need to have a clear goal. Perhaps WFH 5 days-a-week will seem too isolating (or impractical), so do you want 3 days in the office, 2 days at home? Or maybe a 9-day fortnight.

Also, if you are likely to fall into the category of being asked to work more flexibly (social distancing is going to last for some time, so you may not actually be welcome in the office), you need to work out what works for you. If you crave the stimulation of an office environment at least part of the week, make sure your employer knows that WFH permanently is a deal breaker… and let’s face it we all find it difficult to be home 24/7 with family rows over internet usage.

TIP: Presenting a simple solution will make it easier for your immediate line manager to make a decision (remember, everyone else will be putting in flexible working requests too). However, you might have to be flexible about being flexible – for example, to agree to WFH on a Wednesday because everyone else is at home on a Friday.

STEP 3: PRESENT A SOLUTION – NOT A PROBLEM

The financial implications of Covid-19 mean that organizations will be looking to shed staff and cut overheads. One of the most obvious cost savings is premises – with predictions that there will be a huge shrinkage in office floor space even after the world gets back to work.

So, highlight the savings on office overheads from sharing space, hotdesking or remote working.

Another way to save money – and potentially save your job – is to offer to work a reduced working week.

Yes, it will mean a pro rata salary (a 20% pay cut if you move to a 4 day-week), however if the coronavirus has taught us one thing, it is to value having less while enjoying more time with those we love.

If you no longer have to afford two holidays a year (it might be difficult if there are travel restrictions for some time to come), are saving a fortune on eating out (more of us are becoming proficient home chefs) and spending less on grooming (who else is embracing a more natural look?), you might be able to take that pay cut.

TIP: Make yourself less expensive – you will then be less expendable. Being cheaper to employ while being more productive will make you less of a target for redundancies than your colleagues.

STEP 4: WHAT DO YOU NEED TO MAKE IT WORK?

There is no point asking to work flexibly if the office can’t get hold of you, conference calls keep cutting out and your presentations no longer look professional.

So, you need the right tools. That includes the right tech (laptop, software, printer and an upgraded internet connection). Also discuss insurance (this might cost more if you have expensive equipment at home), the extra costs of running your home office (electricity) and an allowance for things like stationery, printer ink and other office supplies.

TIP: Don’t make expensive demands (it could be a dealbreaker) but show you have thought through the practicalities of WFH and wish to have an open conversation about how to make the new arrangement work. In some countries you may be able to claim these expenses against tax and in the UK from 6 April 2020 employers have been able to pay up to £6 a week (£26 a month) to cover additional costs if you have to work from home (although not for those who choose to do so).

STEP 5: KNOW THE LAW – JUST IN CASE

While employers are likely to be highly responsive to flexible working requests – or even insist that more staff WFH at least part of the week – it still pays to know the law…and in particular, what reasons your employer can use to refuse your request.

Many workers around the world (Europe, Australia, some parts of the USA) have the right to request flexible working (although this is NOT the same as being able to work in the way you wish – you just have a right to make a request).

Generally the reasons for refusal include:

  • additional costs
  • it is impractical – either you have to be there in person or there will be difficulty reorganizing work among other staff
  • there will be an impact on performance, productivity, quality, customer service

TIP: It is better to preempt a refusal, by countering it in your flexible working request. It will not only show that you know your rights but also that you have thought of practical solutions to any potential problems.

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How One Supplier Pivoted From High Fashion To Scrubs

How do you pivot your operations? Here’s how. We discover how one fashion house started making scrubs. 


Imagine, for a second, that during this pandemic, procurement simply wasn’t needed within your organisation. Your boss then came to you and said that the business valued you and thought you had some transferable skills, so they had decided you should switch into a sales role, immediately. How would you feel? What would you do?

Admittedly, in this situation many of us would panic. But right now, we don’t need to look far to find people that that exact situation has been thrust upon – namely, our suppliers. Throughout this pandemic, we’ve witnessed this exact, almost instant change, occurring from Ford and Tesla switching their production to making ventilatorsto 3M making face masks. But how does it feel to have your world changed, overnight? And as the pandemic rolls on with no vaccine in sight, can we expect more suppliers to be doing this? 

To get an insight into this fascinating transition from a supplier’s perspective, we spoke to Martin Kristensen, Director of the House of Kristensen. Incredibly, over the last few weeks Martin and his team has transitioned from manufacturing high fashion to making homemade scrubs, which are now being used by the NHS. 


Martin, tell us about your business prior to now making homemade scrubs? 

Sure, so House of Kristensen is a couture fashion house specialising in made-to-measure, bespoke designs. We create unique feature pieces for both private and public/professional clients, with our public pieces being quite high-profile. 

For our private clients, we design mostly for special family occasions, such as weddings, birthdays, bar mitzvahs, etc. For our professional clients, we do everything from gown design for famous TV shows as ‘Strictly’ or ‘The Voice,’ to dressing stars for stage performances(we’ve worked with Katy Perry and Dame Shirley Bassey, to name a few). We also create stunning outfits for red carpet appearances, including Cannes Film Festival, the BAFTAs, and many more. 

We understand that you’re based in London. Tell us how the coronavirus unfolded for you. What’s your personal experience been and how has it affected your business? 

I couldn’t have been in a stranger situation when the Covid-19 escalation was first announced. I was actually running around a woodblock with camo-cream on my face on a training exercise with the British Army Reserves!

Prior to departure, though, I had left an action plan for my team with guidelines about what they should do if the situation escalated. My training was cancelled, so that allowed me to return to my team.

When I returned to London, immediately our focus was on adapting our workforce to be able to work from home, at least temporarily. This involved significant kit & equipment prep as well as material allocation so we could still execute our production schedule. 

Beyond that – honestly – the outlook for us wasn’t that rosy. We’re fundamentally in the events business, and with Covid, most events were axed. We had a quarter of a million pounds’ worth of cancellations, and little room for new opportunities. 

Everyone was afraid, there was no certainty. All we could do was focus on being proactive, strengthening existing relationships and forging new ones. 


With everything that was going on for you, how on earth did you think of switching to produce scrubs?!? 

Scrubs4Heroes was born out of recognition of the extremely challenging situation facing our frontline staff and a desire to help in any way we could. 

For those of us in the leisure and luxury sectors, It is not every day that we are able to be a part of helping safeguard peoples’ lives. 

I will always remember the amazing care I received after my hand was broken in a cycling accident. So when I heard about the shortages at Chelsea and Westminster Hospital, where I’d been treated, I called them to offer support with scrubs if any were needed, the response was clear and more requests followed, pushing us to capacity. 

I then decided volunteers were needed to help us meet demand and we then created Scrubs4Heroes. I am proud to say we now have almost 200 volunteers and are burning through about 3000m of fabric per week to meet our urgent orders.

We’re intrigued! How do you actually make scrubs? 

The process is very interesting and there’s lots of different design features you definitely wouldn’t think of. 

Firstly, you need to find the right fabric. We discovered quickly that poly-cotton was best, as it provides a resistance to shrinkage when cleaned at higher temperatures as well as a resistance to wear/tarnish, whilst also ensuring a degree of breathability. 

The next step is the creation of the garment, from a specific NHS-approved pattern. We also need to consider details relevant to practicing medicine such as colour. Colour is a lot more important that you’d think – research shows that looking at blue/green helps keep doctor’s eyes more sensitive to variations in red. So if you are a terribly busy doctor, nurse or surgeon looking at blood frequently, operating or trying to detect an infection, typically indicated by levels of redness, blue or green is invaluable to refresh colour perception

That’s amazing! How many scrubs are you making now? 

Lots! The list of places we are supporting has grown significantly in recent weeks. We now have 14 NHS trusts and clinics we are working to supply, as well as six GP surgeries and just this weekend we delivered to NHS Glasgow. 

We are also now supplying HM prison service with instruction packs and material to help them produce scrubs for the NHS. We think that’s pretty special – I think it would have to be the first couture house and correctional facility collaboration! So far they anticipate adding 50-100 sets of scrubs to our relief effort per week.

Congratulations on your great contribution Martin! Where to from here? 

It’s hard to say. There’s a high degree of uncertainty at the moment and we’re not anticipating a flood back to the sort of events we cater for. We need to remain nimble and agile and adapt to our changed circumstances. One example of how we’re doing this currently is with our Couture-In-Situ Service where your own personal shopper comes straight to your home, hotel or office with a selection of 30 carefully styled looks. This enables us to provide the same level of couture and expertise, but within your own safe setting. 

Way to go, Martin! Is there a thing or two you think can you learn from Martin’s transformation? What does it tell you about how you personally are dealing with change? And how are you currently remaining nimble and adapting to changed circumstances? Tell us in the comments below.

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Fake Masks And False Cures: The Dark Side Of COVID-19

Criminals exploit COVID-19 fear with fake medical equipment. Here’s how world governments are fighting back.


COVID-19 means huge opportunities for criminals.

They are taking advantage of essential goods demand by flooding the market with their own shoddy versions – exploiting public fear.

Here’s a look at the most common (and concerning) fake products on the market.

Fake goods in the EU

Counterfeit pharmaceuticals and healthcare products are everywhere, according to Europol, the European Union’s law enforcement agency.

In a recent report, it listed the most worrying fake items they’ve uncovered:

Medical equipment: face masks, virus test kits, gloves

Disinfectants: alcohol-based hand sanitiser, disinfectant cleaning wipes

Medicine: choloroquine (an anti-malaria drug initially thought to help treat the Coronavirus), other fake cures

Europol says the fake goods are sold through online stores created just to profit from the pandemic. Some even target victims through messaging apps like Telegram.

The goods originate from ‘frequently changing addresses in Asia’, making it extremely difficult to trace.

Europol is concerned these inferior goods could put people at serious risk.

“Counterfeit goods sold during the corona crisis do not meet the required quality standards and pose a real threat to public health and safety,” says Europol Executive Director Catherine de Bolle in the report.

“People who buy these fake products have a false sense of security, while they are in fact left unprotected against the virus.”

Substandard masks in the North America

And it’s not just Europe. The pandemic is keeping United States’ Homeland Security busy, with more than 200 criminal investigations related to COVID-19 so far.

One woman was caught selling illegal pesticide on eBay, claiming it could provide immunity from the virus.

Another man allegedly tried to sell 100 million facemasks to the government, despite not actually having any.

The man claimed his stash came straight from 3M, one of the biggest healthcare equipment manufacturers in the US.

3M responded with a lawsuit, saying: “3M’s legal team is taking strong action to protect 3M and the public against the conduct of those who seek to exploit 3M’s brand and reputation and defraud others during this time of emergency and crisis.”

3M is also suing a Canadian company for re-selling 3M masks at five times the retail price, vowing to “[put] a stop to those who are trying to cash in on this crisis.”

Another worrying trend in inferior products is testing kits.

The University of Washington School of Medicine spent thousands exporting kits from Shanghai, only to find some of the tests were tainted with bacteria.

The university has since recalled all tests to be on the safe side.

Seizing test kits in Australia

Australia has similar issues with shoddy test kits, according to Zoran Kostadinoski, Head of Border and Biosecurity at the Customs Brokers and Forwarders Council of Australia (CBFCA).

He said the border force has intercepted hundreds of dubious testing kits and personal protective equipment (PPE).

Even though members of the CBFCA aren’t directly responsible for checking the authenticity of goods, they warn importers and exporters to be diligent.

“Procurement professionals need to ensure they source PPE from reputable manufacturers that provide quality products and meet the health standards of the importing country,” he warns.

“Until there is a global regulation of such products that provides certification, the issue of counterfeit goods in the supply chain will continue, as some look to make quick profit based on demand of such products due to COVID-19.”

China pledges to clean up

Authorities are doing their best to help people identify goods that meet safety standards.

The US Centers for Disease Control and Prevention even set up a website with photos of the most common counterfeit face masks.

Nevertheless, the question remains: why isn’t there greater effort to stamp out fakes before they are ever exported?

It’s complicated, as LA Times journalist Alice Su explains.

“It’s common for Chinese suppliers to export a product under one licensed company’s name but to source their products from second, third or fourth factories, like a chain of Russian nesting dolls, with little to no traceability down the chain of supply,” she writes in an article.

She also points out not all suppliers set out to produce inferior products. Many factories shifted to PPE production at the government’s request without knowing the proper quality controls.

Regardless, the Chinese government is making a concerted effort to shut down offending manufacturers and revoke their export licenses.

Fighting online crime in the UK

That process isn’t happening quick enough for people like Sarah Stout, however.

She’s the CEO of Full Support Healthcare Ltd, a supplier to the UK’s National Health Service.

Recently, she shared on LinkedIn that her company gets dozens of offers every week from manufacturers of the sought-after N95 mask.

95% of the masks are fake with forged certificates, she says.

“When I informed one supplier that I knew their certificates were fake, they said to me, “[O]k, if I give you real certificates for other product will you place an order?’” she writes.

Her experience isn’t unique. UK authorities say they’ve taken down 2000 Coronavirus scam websites so far, including 471 fake online shops.

Many of these websites were discovered through spam emails. One common email appears to come from the World Health Organization and offers COVID-19 health tips in exchange for personal password information.

James Brokenshire, UK Minister for Security, urged people to be aware of the many ways criminals exploit technology like email to gain advantage.

“It’s despicable that they are using the coronavirus outbreak as cover to try to scam and steal from people in their homes,” he wrote in a press release. “We all have a part to play in seeing they don’t succeed.”

In response, the UK’s National Cyber Security Centre is asking for people to send them any suspicious emails.

It’s not just a UK problem, though. Pandemic spam mail is a global headache, with Google detecting 240 million COVID-19 related spam messages so far.

How to tackle it

Even though technology is used for exploitation, it’s also a key to stopping Corona crime.

One company in the fight is Systech, which lets you check if PPE product is authentic by simply scanning the product’s barcode with a smartphone.

The company uses blockchain technology to trace the product journey throughout the entire supply chain.

Similarly, Zuellig Pharma, an Asia-Pacific pharmaceutical giant, utilises SAP’s blockchain platform to verify authenticity.

Customers can scan a barcode on the package using the eZTracker app, and know instantly if the medicine is a legitimate Zuellig product.

This use of technology, along with the efforts of governments and the vigilance of the public, go a long way to combat the dark side of COVID-19.

However, until essential goods supply can match global demand, criminals will find a way to cash in.

Want to keep up with the latest coronavirus and supply chain news? Join our exclusive Supply Chain Crisis: Covid-19 group. We’ve gathered together the world’s foremost experts on all things supply chain, risk, business and people, and we’ll be presenting their insights and daily industry-relevant news in a content series via the group. You’ll also have the support of thousands of your procurement peers, world-wide. We’re stronger together. Join us now.

The Spy Who Loved Me – To Track Or Not To Track? That Is The Question

Companies ‘spy’ on remote employees using tracking software. Great for productivity? Or a massive invasion of privacy?


Covid restrictions are starting to ease, and soon the global workforce will swap their comfy sweats for a morning commute.

It won’t happen overnight, however.

Leaders like UK Prime Minister Boris Johnson want people to stay spread out, staggering shifts and working remotely where possible.

And some companies may even adapt policies to give employees the option of permanently working from home.

That leaves managers with the task of keeping staff productive from afar.

There are all kinds of ways this can be done, but one method stands out for its rising popularity (and sheer invasiveness): tracking software.

Here’s a look at what the software does, why companies use it, and its effectiveness.

Employee surveillance

Staff tracking software gives employers the ability to keep close tabs on employee.

Features vary, but this kind of software lets companies track everything a staff member does on a company computer.

This ranges from recording all websites visited, to taking screenshots every few minutes and sending them back to the boss.

Virtual monitoring isn’t anything new; IT and HR teams have used such tools for years. What’s new is the huge uptake in surveillance software subscriptions since the pandemic started.

In fact, one surveillance software company, Hubstaff, saw a 95% increase in new customers in March over February.  

Enforcing productivity

Is it overkill to record everything an employee does?

Not at all, says Courtney Cavey, Hubstaff’s Marketing Director. In fact, she welcomes being monitored with Hubstaff’s own software.

“The freedom it ultimately grants is priceless,” Cavey says. “[My boss] knows I’m working when I say I am because he can see that I’m tracking time and activity levels, and completing tasks, so he doesn’t have to look over my shoulder and constantly ask for updates.”

It’s certainly one way to make sure staff are productive. But it isn’t the only way.

Trust over anxiety

With all the other productivity tools for remote teams, including Slack and Zoom, why is surveillance software so popular?

It’s all about control, according to executive consultant Lloyd Bashkin.

“It’s perfectly understandable that CEOs will feel anxious at a time like this,” he says.

“[I]t’s a basic human need to want to feel a certain amount of control, and when that is stripped away, bingo – anxiety spikes.

“So rather than see [computer surveillance] as paranoia, for most CEOs it’s just a natural inclination to feel a certain amount of control.”

As CEO of management consultancy Lloyd Scott & Company, based in New Jersey, Bashkin says times of crisis only intensify a person’s leadership style.

“The perception of inescapable fear, such as COVID-19, will amplify a CEO’s behaviour – so untrusting CEOs become less trusting (as a way to relieve anxiety) and more mature, trusting CEOs become more trusting,” he says.

Loosening the reins

As an example, Bashkin points to a recent client – a CEO who clashed with his head of procurement.

The CEO had a long running dispute with the head of procurement, accusing him of having a negative attitude and of letting quality slip. Then the pandemic hit and remote working only made the conflict worse.

The CEO’s solution was to monitor the head’s computer activity closely. If that didn’t work, he’d simply fire him.

Luckily, a conversation with Bashkin helped the CEO realise the problem was his own trust issues. So the CEO gave the head of procurement more freedom to do his job without interference, and the problems disappeared almost overnight.

Output over input

That’s because staff realise when they aren’t trusted by their manager, and close monitoring can be demotivating.

“If employees feel their manager is looking over their shoulder at every moment, trust goes out the window immediately,” says Corporate Rebels’ Pim de Morree.

He thinks surveillance software is ‘micro-management gone wild.’

“Apparently, employers don’t feel the staff they hired are capable of doing a job without them tracking their activities,” he says. “It’s the workplace equivalent of a prisoner’s ankle bracelet.”

Instead of focusing on how work gets done, he says the real measure of productivity is what gets done.

“Figuring out how to measure that is the real problem to solve,” de Moree says.

Legal barriers

However, not all surveillance stems from mistrust or control issues.

There are vital reasons for monitoring staff computer use, like protecting networks from malware or other viruses.

In fact, some companies are required to track employee activities to meet legal obligations. The key to doing it well is transparency.

Employers should let employees know what information they collect and why, says Ashwin Krishnan, tech ethicist and COO of UberKnowledge.

He advises companies to explain staff monitoring “not in legalese terms, but in actual terms of what this means for [the employee].”

He says companies need a clear ethics and privacy policy for data ownership – like how long it’s held and what happens when it isn’t needed anymore.

“When employees can see the full extent of the responsibility and diligence shown by leaders, it breeds trust,” says Krishnan.

Be empathetic

That said, it takes more than transparency to increase productivity, Krishnan says.

Remote staff are far more productive when they feel supported – especially in these unusual times.

“Suddenly, the employee’s home life needs to become part of the manager’s discovery process,” he says.

“Not every employee may be willing to share this but letting them know that they have a supportive ear if they need it is crucial. [A]dapting previously scheduled work meetings (adjust timing, duration, frequency) to deal with this at-home reality shows empathy.”

Such empathy can also help customers be more patient with a company’s employees. 

Kristy Knichel, CEO of Knichel Logistics, a shipping logistics company in Pennsylvania, recently wrote to customers explaining her team’s new work situation.

Many of her staff are working remotely for the first time, and some even need company internet hotspots since they don’t have Wi-Fi at home.

“We understand that our employees are accustomed to the ease of communicating with one another in person in the office, so this has been quite a change to adjust to,” she writes.

“[O]ur team has made the transition smoothly and we hope that you have not experienced any disruption.”

Destination, not the journey

It isn’t easy to manage a remote team – especially during a pandemic.

It requires trust and empathy, while letting go of the need to control every employee move.

That’s why the best way to improve productivity is following de Morree’s advice and focus on what an employee delivers – whether in the office or not – instead of how they delivered it.

Want to keep up with the latest coronavirus and supply chain news? Join our exclusive Supply Chain Crisis: Covid-19 group. We’ve gathered together the world’s foremost experts on all things supply chain, risk, business and people, and we’ll be presenting their insights and daily industry-relevant news in a content series via the group. You’ll also have the support of thousands of your procurement peers, world-wide. We’re stronger together. Join us now.

The Coronavirus Has Exposed How Delicate Our Procurement Ecosystem Really Is

Do we need a fundamental reimagining of what our procurement ecosystem looks like? We think so. Here’s why 


For so many around the world, the experience of the coronavirus has been like waking up from a dream, only to realise you’re still in it. You knew the world around you, or you thought. But suddenly, frighteningly, everything you knew started to become unstitched. The four walls of your apartment became rather stifling, but the blue sky outside seemed more radiant than ever. You savoured your favourite pasta, you learnt to use just one sheet of toilet paper. You wrote a letter to a loved one. You realised how precious a hug can be. 

The pandemic, undoubtedly, has been about the big things. Lives lost, businesses broken, economies shattered. But for many of us it’s also been about the total inversion of the small things. Take, for example, ‘essential workers,’ the people that – let’s be honest – before, we rarely thought about. This crisis has highlighted just how important the supermarket shelf stackers, cleaners and parcel delivery people are to our daily lives. These jobs are not ones we aspired to, nor ones most appreciated. Now though, we’ve had to take a step back from our life of never-ending convenience and expectation to understand that these people are the ones that prop up everything, while we continue unwittingly. The delicate ecosystem that supports each and every one of us has been exposed, and there’s no going back – not now, not ever. 

Just as the ecosystem of life has been laid bare, so too has the fragility of our supply chains and the logistics monolith that supports it. ‘Before,’ a term that cannot be so casually used anymore, the proverbial ball was largely in our court. Our suppliers and contracts, hard-won after tough negotiations, became a feature, ever compliant, on a spreadsheet. We kept demanding, they kept producing – nothing to see here. Until of course, there was everything to see, and we were scrambling to figure out if not you, then who? The scramble laid bare the fact that our supplier represented a lot more in real life than as a piece of data on our computer. 

Yet still, for a while, it was a ‘China problem.’ They’ll sort it out, we told ourselves, after all, SARS! They know what they’re doing. We failed to own the problem as ours, we barely contemplated the potential for a global logistics breakdown. Force Majeure was there to protect our interests, not the fact that our cash-strapped supplier might be forced to shut – and may not have the ability to reopen. Overnight, it became a supplier’s market again. They knew we needed them, and badly. Their faults became our headaches – but what did we really expect?  

That supplier? That logistics trail? That global, intricately woven, incredibly complex system that supported us? That is our ecosystem. Those suppliers, we’ve realised, they’re so much more than a number on a spreadsheet; they’re a livelihood – ours. They’re complex, they’re human, our relationship is not a one-way street. Understanding them, analysing them, getting real-time data and above all, building a relationship, is the only way to keep them – and our precious ecosystem – alive. 

‘Before’ we squeezed them on price, because we could. After all, that’s our job, right? Now? Those dollars don’t count for much, if we can’t keep manufacturing. ‘Before’ we preferenced short-term gains, it just looked better. Now, we realise how little those gains counted for when we’ve had to throw our business continuity plans out the window. ‘Before’ we could afford to put process before people, we could afford to be blind rule-followers. We could afford to do what we always did, because that’s just the way it was always done. 

But now? We know. If the pandemic has done anything, it’s forced us to hold ourselves to a higher moral standard. Our suppliers are our partners, we should treat them with the respect that title deserves. Sure, monitoring tech is needed, some even say that it could have predicted the current interruption – and planned for it. But beyond the data, the AI, and all the tools we’ll soon have in our toolbelt, what we need most is human relationships. Respect. Good business practices. Efficiency, not processes. Value, not dollars.

Right now, we’re living a nightmare. But when we wake up, we’ll still be in a dream. Let that be one, procurement, where we forge new relationships, break new boundaries, and focus on what really matters – people. Let’s look to technology not to replace human interaction, but to enable us to better collaborate with our suppliers, and to do so with more of them (not just a few we’ve determined to be most strategic).

An Employee Tests Positive For COVID-19: What Now?

If you haven’t dealt with an employee testing positive for COVID-19, you probably will in the very near future. How are you going to manage it?


It’s a complex challenge that calls for quick and decisive action from business managers. The best practice will vary, depending on your workplace.

HR and workplace experts across the world are scrambling to communicate best practice to employers amid the COVID-19 pandemic.

A webinar organised by Hazmasters covered best practices for a various workplace types. The US company works with companies to build a strong safety culture, and has been overwhelmed by demand amid the COVID-19 pandemic.

The webinar revealed that in the US alone, 14.4 million workers face exposure to COVID-19 at least weekly, while 26.7 million face exposure at least once a month.

Sylvia Kolitsopoulos is head of brand strategy and business development for Hazmasters. She explains that symptoms of COVID-19 may appear 14 days after exposure to the virus, making it difficult for workplaces to navigate the risks.

She recommends that workplace health and safety committee should be involved in creating best practice and training programs that work for your business environment. 

“We’re all doing our part to flatten the curve to get through this unprecedented time,” she says.

Kolitsopoulos and her team of Hazmasters colleagues contributed to the webinar, explaining that workplaces need to implement proper workplace hygiene practices.

Crucially, if an employee does test positive for the virus, it’s important to keep a record of this on the employee file and that any potential areas within the organisation that may have been contaminated in your workplace are recorded.

If an employee within your business is exposed, these procedures should be followed:

  • Immediate removal from worksite of individuals testing positive
  • Prompt identification and isolation of potentially infectious individuals
  • Individuals to monitor symptoms for 14 days and contact local health authority if
  • Thorough disinfectant cleaning by a certified company
  • Identify where person has been in the workplace to ensure those areas
  • If you can’t send them home, isolate the contaminated areas so decontaminate team can deep clean the area.
  • Continually check local health authorities for update as advice changes regularly.

Source: Hazmasters webinar

What rights do employees have?

Employees that have contracted COVID-19 will have different rights depending on legislation within each jurisdiction in your own country.

However, in most cases, if an employee is showing flu-like symptoms (whether COVID-19-related or not) while at work, they can be sent home. This is a standard workplace health and safety obligation.

Many employers are wondering if they need to pay impacted staff. The key here is to check the advice from your local authority, which may change as the pandemic continues.

A new report by research firm McKinsey says manufacturing plant leaders can help navigate the transition from initial crisis response to steady the corporate ship with three key steps.

These are:

Protect the workforce: Formalise and standardise operating procedures, processes and tools that help keep staff safe. Build workforce confidence through effective, two-way communication that response to employees’ concerns through flexible adaptation.

Manage the risks to ensure business continuity:  Anticipate potential changes and model the way the plant should react well ahead of the fluctuations to enable rapid, fact-based actions.

Drive productivity at a distance: Continue to effectively manage performance at the plant while physical distancing and remote working policies remain in place.

The report also reveals that absenteeism rates are another important area of focus. Employees are concerned about COVID-19 exposure, which could make them reluctant to come to work, while others may be prevented from attending work due to sickness or due to quarantine rules.

To handle this scenario, some companies are proactively reaching out to employees the day before and the morning of their shifts, and asking if they are planning to come to work, while others are offering hazard pay or soliciting volunteers to be on call for overtime, depending on vacancies, the report explains.

Protect employees

Employers need to take precautions to protect all employees, he explains.

“There are heightened concerns regarding the transmission of COVID-19 in the workplace. If an employee has been absent from work due to flu-like symptoms, it would be reasonable for an employer to make enquiries regarding their ability to safely return to work,” Paterson says.

“These enquiries could include requiring them to obtain a medical clearance indicating that they are not suffering from any disease which may pose a health and safety risk to their work colleagues,” he says.

If an employee has contracted COVID-19, you need to ask who they have been in close contact within the prior two weeks.

Close contact is defined as a person that has been within six feet of the infected employee for a prolonged period of time. You should alert those who have been in close contact as soon as possible.

In terms of confidentiality, the law is clear here. You should tell everyone who has possible exposed at work to the positive employee, within revealing the employee’s identity.

Looking ahead

Moving forward, the lesson here is that workplaces need to have a roadmap in place to respond to pandemics. This includes the potential work from home scenario and specific procedures to ensure the health and safety or employees.

This includes the creation of pandemic kit for employees who have to visit clients, such as hand sanitiser, mask, safety glasses, disposable gloves, sanitising wipes and a garbage bag.

It’s also worth creating a blueprint for the unexpected. While it’s COVID-19 this year, next time it could be an earthquake, recession or something else unforeseen. Global consulting firm Korn Ferry has created this handy guide to implementing a blueprint that works for your business.

Want to keep up with the latest coronavirus and supply chain news? Join our exclusive Supply Chain Crisis: Covid-19 group. We’ve gathered together the world’s foremost experts on all things supply chain, risk, business and people, and we’ll be presenting their insights and daily industry-relevant news in a content series via the group. You’ll also have the support of thousands of your procurement peers, world-wide. We’re stronger together. Join us now.

Out is In: an Outline of the Outlook for the Outsourced

There are ample opportunities for savings in outsourced services implementing the right models for balanced success.


Just over six months ago, I left my role in a well-established procurement advisory firm to take a deep dive into the outsourced services category. My spend management sense told me this category was still untapped by procurement. Now, amidst an unexpected crisis affecting nearly every business in the world, my instincts have been confirmed.

As a baseline, it’s important to understand that indirect service categories tend to get less attention than direct categories or indirect goods, which tend to be more visible. Many indirect services happen in the background, while we’re off at night, despite filling an important need.

To quantify the gaps, we’re running a study on the capabilities and outcomes procurement teams are using in services categories. It’s still open for a few weeks more, so please click here to benchmark yourself in areas like analytics, talent, category management, and value delivered across services categories. I look forward to sharing detailed results with participants as we all try to focus our efforts where we’ll have the most impact.

Outsourcing as a spend category

Specifically, what do we mean by outsourced services? Over the last 30 years, both non-core and core activities have been shifted outside of the organization. While the original goal was cost savings through labour arbitrage in lower cost regions, objectives broadened as provider capabilities developed and companies served increasingly global markets. These days, outsourcing projects are as much about digital transformation as they are about cost cutting.

Many industries rely heavily on outsourcing partners. For example, a typical financial services organisation could spend 5 per cent of its revenue on business services, and more than half of its IT spend could come from services, not software or hardware. That shift means business processes, engineering services, and IT sourcing make up hundreds of millions of dollars of spend for organisations.

As a procurement advisor and consultant for the last 15 years, and a practitioner and services buyer for many years before, I know how tightly procurement has squeezed savings out of every spend category possible. The whole concept of category management is predicated on the idea that savings will flatten over time, and procurement must become a trusted advisor to enable stakeholders in delivering higher forms of value from the supply base. For most categories, price benchmarks are hard to come by, RFPs across multiple suppliers drive pricing down, and relationships can be transactional for all but the most strategic items.

Outsourced services are different. There may only be a couple of suppliers to choose from, and switching costs are high. Service providers are serving as extensions of company operations, sometimes in customer- and employee-facing roles with sensitive information.

At Everest Group, an analyst firm focused on the global services market since 1991, we see untapped opportunities for procurement to better manage outsourced services categories. More suppliers than buyers are accessing the wealth of information on service providers, best practice contract terms, and cost models. The components for strong category planning exist, but procurement teams are just starting to access them. Price and contract benchmarks are readily available, and most projects reveal double-digit opportunities to improve costs. Like many other strategic categories, these are dynamic relationships that benefit from strong category management tactics: quality market intelligence, collaboration with stakeholders, well informed negotiations, supplier partnering, and risk management. There’s so much opportunity for value in these categories as buyers become more educated about the market.

Global services during the COVID-19 pandemic

Of course, we can’t have a conversation about global services in 2020 without talking about the impact COVID-19 is having on the world. My colleagues and I have been busy speaking with service providers and buyers, and crunching the data to help companies emerge from this crisis stronger and better prepared. Check out our COVID-19 resource center for ongoing posts, reports, and even a dynamic tracker to see impact to global service delivery by country.

Optimising costs and modernising value delivery

There’s never been a better time to address cost improvement opportunities in outsourced spend. In our upcoming webinar with Procurious – “5 Cost Levers To Pull Right Now With Your Outsourced Services” – we’ll talk about opportunities to optimise costs and modernise value delivery.

This is not about pushing suppliers to the brink to cut costs while compromising their ability to survive and sustain good services. In fact, as a thought leader focused on driving procurement organizations to create higher value, it pains me a bit to allude to cost savings in the webinar title. As a function, we need to resist the urge to revert to 2008-style high-pressure cost cutting. This is about working with service provider partners to ensure we have the right models in place for balanced success. Our success post-crisis is dependent on having the technology, service levels, and terms in place to operate in a digital world. In fact, service providers prefer to work with educated customers, and, so, prefer small adjustments every few years rather than large corrections when an uninformed customer learns they were wasting money throughout a five-year contract.

During the webinar, we’ll talk in depth about the following improvement levers:

  1. Paying the right price – market rates in services can be quite dynamic; it’s important to understand cost drivers and adjust rates regularly.
  2. Understanding total cost – it’s never just about rates: there are hidden cost drivers everywhere and we need to know where to look.
  3. Deal structure – there are several ways to structure an outsourcing engagement; none are right or wrong for all situations. We’ll talk about what to consider and what to avoid.
  4. Innovation – Innovation and digital transformation is becoming a priority in outsourcing, but we often miss this while focusing on costs.
  5. Financial engineering – there are creative ways to fund productivity. We’ll give a few examples of recent deals that shift the paradigm for buyer and supplier.

Whether you manage a small amount of outsourced spend or multi-million-dollar contracts, or are just curious to learn about a new category, please join us for an interesting and educational conversation.

Assistance for services buyers

During the COVID-19 crisis we are offering pro bono assistance to services buyers in the procurement community:

  • Complimentary price checks on up to three standard roles in three different locations – a pulse check to see if your rates are in line or out of line with the market.
  • A service provider risk profile covering four key parameters (finance, governance, operations, reputation) –  find out if there are underlying concerns with your provider beyond the immediate crisis.
  • A conversation with one of our analysts on any global services related topic – ask questions, test your strategy, or get feedback on what others are doing from our senior team.

Our team at Everest Group is excited to be working with Procurious, and we look forward to helping members create value for their organizations.

Amy Fong

Vice President – Strategic Outsourcing and Vendor Management
Everest Group

To find out more about these cost levers, and to access expert advice on how to use them, register for the Everest Group sponsored webinar 5 cost levers to pull right now with your outsourced services, to be broadcast on Thursday May 7th 2020 at 2:30pm GMT. To find out all the information you need, including how to sign up, visit the Procurious website or click here.

What A Two Year Old Taught Me About Emergency Procurement

Think parenthood and COVID-19 have nothing in common? Think again. Read on for 5 lessons that parenting a toddler has taught me and how these apply to emergency procurement situations.


It is pretty difficult working from home with a toddler at any time, but even more so during a lockdown.

I fell into despair last week.  The pressure was on. Two phones were ringing off the hook from an emergency situation, when my toddler ripped off their pants and became the entertaining backdrop for my video call.

COVID-19 lockdown is one of those moments that will be earmarked in my time capsule. It seemed to hit at once across all fronts. Work and home life were hurled into turmoil.

But rather than spiralling into a work/life balance death spiral, I called on some of the valuable lessons I have learnt as a parent.  Rather than being a distraction, they have been my secret to success in managing myself and my team through a series of emergencies bought on my the COVID-19 crisis.

Emergency procurement

COVID-19 has been impacting business both domestically and internationally for some months, requiring rapid action from commercial teams. My role is to provide support, to draft contracts, create requirements, obtain pricing and negotiate. It’s a team effort, but a mammoth amount of energy for each person involved.

Take on board these 5 simple lessons from my time dealing with emergency situations.

1. Set your pace and do so carefully

Just like parenthood, the COVID-19 pandemic is a marathon, not a sprint. It’s the adrenaline that comes with working on critical and time pressured projects makes you want to sprint. In fact you tell everyone you’re fine and can take on even more work! Foolish. This is a recipe for burnout and one I learned the hard way.

During a recent time pressured day, I drew on the parenting experience of trying to be an octopus. The dinner is about to boil over the kid comes running in with a live grasshopper and someone is knocking at the door.

I had 20 minutes to review 6 contracts and make a determination about next steps. The only thing you do in these situations is scan the most important details that you need to check and be a speedy risk mitigation machine! It pays to have your manager on stand-by to ratify your decisions.

2. It’s practical not technical

You can read all the parenting books you like, but it’s not until you have sole accountability for a human being that you really know what the job is all about!

In procurement, getting the call to undertake an emergency project can be quite unnerving. My first thoughts were to start questioning all my technical knowledge, but I needn’t have worried. Commercial acumen in practice can look like asking the obvious questions and checking the basics. It is surprising in the pace of the environment and the revolving door of personnel what is not pieced together. Back yourself to ask the tough and difficult questions no matter what your title or rank.

Questions that should be asked when delivering goods overseas at speed: what happens if the recipient country situation changes in transit? When should ownership and transfer of assets kick in? Check warranties, support and training. How useful is it if the helpdesk is in a different time zone?

3. Don’t forget the day job

Parenting is a 24/7/365 day job. It never ends. Managing a procurement team during an emergency situation is not much different.  During the COVID-19 crisis, the biggest thing I’ve struggled with is providing quality leadership and management to my team. I hold myself to high standards. When I answer the call on a Sunday to work on the next emergency situation it is hard to find the time to run the day to day. Being honest with the team and sharing what I’m working on helps them to contextualise their work. Leaning on management and peers to share the management load relieves a lot of pressure for me. I had to know when to stick my hand up and utter those difficult words “I’m at capacity”.

4. Pants are optional

When emergency situations have arisen in the past, I tended to try to shoo away the other aspects of my life. This is pretty difficult to do with a toddler in my bubble in lockdown. Particularly when they have taken their discarded pants and walked into my zoom meeting with their pants on their head. This is a leveller.

It reminded me what is most important. When I started opening up about this and other life necessities like going for a walk or going to the supermarket I found a willing and supportive environment ready to cover me.

Negotiating with two suppliers for two separate but interrelated contracts with different time zones will not be done in an hour. Looming press conference announcements weigh heavily and it is easy for anxiety to set in about securing signatures quickly. I learned that my butt in the chair is not going to speed the process up any faster. I needed to go out for walks and prioritise what self-care I needed.

5. Protect your space

When you’re working from home the environments can bleed into one another. It is important to have a separate workspace that is away from other areas. For me it caused confusion about when I was working and when I was not, I defaulted to work mode and learned the hard way that I hadn’t switched off.

Working in a different space changed my habits and it caused me to make a mistake in my work. I didn’t pick up on something in a contract before it went for signing. I realised that it’s because I usually print a hard copy off first before signing.

I realised my “work self” identity needed to change during lockdown. I can’t hold myself to the same standards when the game has entirely changed – mistakes will happen when working at speed. It’s called being human.

I showed kindness to myself and it caused me to think more deeply about the others in my team. It’s taught me to be kinder and patient.

Play it forward

I’m determined to keep these lessons front of mind for the transition phase of returning to work. We’re all likely to be in limbo mode for a while and must be mindful of the ongoing impacts that the lockdown will have and how these can play out.

Kindness and compassion for yourself will invariably lead to more kindness and compassion for others. Put yourself first.

This article is solely the work of the author. Any views expressed in it are those of the author and do not necessarily represent or reflect the official policy of the New Zealand government or of any government agency.

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It’s The #1 Must-Have Skill Right Now… And The Good News Is You’ve Probably Already Demonstrated It.

“Intrapreneurs” – named the most in-demand skill of 2020


A few months ago, it would have seemed impossible. A motor manufacturer making ventilators. A fragrance brand producing hand sanitiser. Or a luxury fashion firm sewing scrubs.

Businesses across the globe have demonstrated an incredible ability to pivot on the head of a pin and change out entire manufacturing and distribution processes in the space of a few short weeks in response to the Covid-19 crisis – and it is procurement and supply chain professionals who are helping to make this happen.

That’s because many of them are “intrapreneurs” – which was named the most in-demand skill of 2020 at the start of the new decade. Who would have predicted back in January, that being an intrapreneur would become even more essential in just a few short months?

Being able to think outside the box and come up with solutions to problems that didn’t even exist a few months ago, is going to help to change the way organisations respond to this unprecedented crisis.

Prolonged decision-making in slow-moving risk-averse corporations has no place in a post-Coronavirus world.

Today it is even more vital to be more nimble and agile – adapting quickly to identify opportunities just like an entrepreneur (although in this case it’s to do good rather than boost profits).

SO WHAT EXACTLY IS AN INTRAPRENEUR?

If you are not sure what the term ‘intrapreneur’ actually means, don’t worry – you are not alone. Nearly nine in ten people polled found the term a complete mystery.

So, here goes…

Intrapreneurial describes someone who “thinks and acts” like an entrepreneur but who works “in” an organization rather than for themselves.

In simple terms they see new opportunities and then take advantage of them. And that’s why they are in such high demand.

Procurement is at the forefront of much of the current innovation – supply chains have been disrupted, borders closed, logistics are a nightmare and yet, procurement professionals are finding new solutions… and quickly.

Forget months or years waiting for answers, procurement professionals are having to identify opportunities and solutions and then innovate even if this involves an element of risk. They are trying new things to see what works. The adapting when they do. In other words, they are having to become entrepreneurial.

THE GOOD NEWS IS YOU ARE PROBABLY ONE

Two in three people possess intrapreneurialism as a skill according to recruiters Michael Page which complies the annual top 100 most in-demand skills list. So, the chance are… you are one of them (even though you may not know it).

How do you know for sure? Well, are you the sort of person who is brimming with ideas and takes ownership of your own success and that of your organization? In effect, you see it as your job (even if it isn’t) to make things happen and bring about change.

Day-to-day, this is how an intrapreneur approaches their role.

An intrapreneur:

  • Is great at identifying opportunities – in this respect the intrapreneur is treating their organisation as their own business and looking for ways to grow it.
  • Is proactive – again this is about ownership. Instead of doing the same things in the same ways, you will be the type of person who thinks of new ways of working or introduces new ideas – before being asked.
  • Is not afraid to challenge the status quo – if something is not working, you are the sort of person who is brave enough to speak up and put themselves on the line to bring about change. This is more than being proactive, it is about risk taking (a trait that is highly entrepreneurial).
  • Is resilient when things do not go to plan – you will be the sort of person who is prepared to learn from trial and error and accept that some ideas might fail, but you do not give up and instead bounce back with other ideas.
  • Is a brilliant collaborator – bringing about change or challenging the status quo is not easy (particularly if this is not your role), so you will be great at bringing people on board. Your ability to build relationships and enthuse others will ensure you get things done.
  • Is great at thinking outside of the box – this is a mindset that goes beyond being innovative. Entrepreneurs succeed because they can see opportunities that others don’t.
  • Is prepared to trust their instincts – entrepreneurs and intrapreneurs need a strong sense of self-belief to push ahead with their ideas and overcome any set-backs.

Why would an organization want an intrapreneur?

Now this is where you might think there is a dichotomy. Afterall, entrepreneurs are risk-takers, free-thinkers and mavericks who want to take ownership of their own business – and these are traits that do not sit well in a corporate culture. After all, you don’t own the business and you have to report to someone higher up.

Well, Nick Kirk, managing director of Michael Page (which identified Intrapreneur as the No.1 skill for 2020), disagrees saying, “Great employees are those who are invested in the company and want to help it improve, which in turn enables them to create a working environment that they enjoy, so it’s a win-win scenario.

“Intrapreneurship may sound like a daunting term, but at base level, it refers to that person who is willing to go the extra mile to improve their workplace.”

And that is exactly what organisations need right now. So whenever you demonstrate your intrapreneurial abilities, make sure you shout about it and promote your achievements on your Procurious profile… you have a skill that is in high demand.

Join Procurious to connect with 40,000 other ambitious procurement professionals and get free access to networking, industry news, training and much more. 

5 Cost Levers To Pull Right Now With Your Outsourced Services

At times of enormous disruption to global supply chains, it’s easy for procurement only to think about direct spend. But it’s just as critical to ensure value is delivered in outsourced service contracts.


“Today’s health and economic crisis, as a result of coronavirus, means that typical approaches to cost management will need careful consideration as business’ key focus has to be staying in business” Lorna Brown, Former CPO, Global Financial Services

We live in an ever-changing world, where what had been predicted as a prosperous year for a business could turn into a fight for survival thanks to something that it has no control over. As the world pulls together to combat COVID-19, businesses face the challenge of reduced revenue forcing them to tighten their belts and search for further savings.

In times of crisis, most organisations will fall into the same pattern and focus their cost reduction effort on direct spend categories. After all, your first thought in a crisis or risk management situation is more likely to be ensuring the stability of your production supply chain, rather than identifying the cost savings you can secure from the organisations delivering your HR or IT Support services.

But why is this the case? Organisations may consider their direct categories as more business critical, or believe that they can release greater value from them with closer management of their global supply chain.  For an increasing number of organisations, however, outsourced services form the core of their business. And by focusing on the right cost levers, review of these service contracts  could deliver just as much in terms of savings as direct spend.

Pulling on the Cost Levers

Structuring a contract for the procurement of services is can appear to be a different beast to one for the procurement of goods. Many procurement professionals will go their entire careers without creating a single RFQ, tender or contract for an outsourced service.

The reality is, however, that there isn’t a great deal of difference beyond what is delivered by the supplier. Procurement still needs to know that suppliers are able to meet an organisation’s requirements. A robust contract needs to be put in place to ensure that services are delivered efficiently and effectively.

And when it comes to cost levers, there’s no need to start with a blank sheet of paper when proven procurement strategies will still fit the bill. Everest Group, a consulting and research company with an established history in the outsourced services space, has conducted extensive research on this topic. Amy Fong, Vice President in Everest Group’s strategic outsourcing and vendor management practice, is clear that this research has highlighted five key cost levers for procurement to use right away when it comes to their outsourced services: “we see a lot of common themes where buyers can do a better job.”

1. Pay the Right Price

Former CPO in Global Financial Services, Lorna Brown, believes that organisations need to be “a bit curious and engage with the supplier to understand how they are delivering the services.” This will allow for a greater understanding of how the service is built up, but also what is driving the costs, and consequently the price in the market.

Services in high demand, but with a lower supply where there are fewer people capable of providing a quality service will cost organisations a premium.  In the  IT services market, this premium has been charged for everything from basic digital skills all the way up to large-scale, highly complex data analytics over the years. The availability of labour with these skills is the key cost driver.  With each ebb in the requirement for these skills, rates for outsourced services will come down.

Being clear about how the cost of labour has influenced your price is a great way to pull this particular cost lever.

2. Understanding Total Cost

Procurement’s consideration of cost needs to go beyond the ticket price that is paid. There are other factors to take into account such as quality of support and adherence to Service Level Agreements (SLAs). It’s all about Total Cost of Ownership.

Got a great price for your basic service agreement? Great! But did you discuss and agree a price for ongoing support? Or agree how many people are assigned to your contract? Or how much you are paying for secure data storage? It’s critical to understand the whole picture beyond the basic price.

If you are just looking to drive savings on the bottom line price by whittling down your supplier’s margin, they will look to move or hide costs elsewhere. No matter how good a deal you think you have at the outset, if you aren’t tracking TCO you’re probably losing any savings you may have initially achieved and leaving this cost lever un-pulled.

3. Find the Right Deal Structure

One of the key decisions an organisation will have to make regarding its services is which model or structure their deal is going to take. In outsourcing of services, a fully Managed Service can be very attractive to an organisation with day-to-day operation provided by an external specialist, with the business free to focus time and effort elsewhere.  

However, organisations using a Managed Service have to accept the fact that they will hand over a level of control, which in turn raises their risk.  Procurement still needs to understand what’s happening throughout the outsourced service provider’s supply chain.

Organisations may also choose to use on-demand outsourcing, where they pay for support based on the number of times it is used, or a ‘Break/Fix’ service where it pays for just the work that is done. There is no right or wrong answer as this will differ from organisation to organisation. What’s important is picking the right option.

4. Innovation

When it comes to cost savings, innovation is a key part of the puzzle that cannot be missed. And when it comes to pulling the innovation cost lever for outsourcing services, the focus should be on “Big I” Innovation (i.e. digital transformation), rather than “Little i” innovation (i.e. continuous improvement activities).

As with the other cost levers we have shown, innovation that is being looked at in other areas of the business can just as easily be applied to outsourcing too. Consider all the current industry favourites such as Robotic Process Automation (RPA), AI and Machine Learning – these can have an impact on costs.

However, despite the fact that there is increasing importance placed on innovation in outsourcing, many organisations are still missing the mark. There’s a lot that can be achieved from deploying this cost lever in the right way at the right time.

5. Financial Engineering

Cost lever number 5 takes the modernisation and digital transformation found in the innovation space one step further: when it comes to the concept of innovation not just about the business scoping out activities for different areas of its categories, but more about how it modernises the entire solution.

It’s important to use financial engineering to have the impact on profit that is required as the initial outlay or investment across the board will be significantly higher than a service that doesn’t include these types of outcomes.  Organisations may choose to look at alternative sources of finance, assess potential Joint Ventures or Managed Services with flexible margins (in line with traditional Financial Engineering). Using this cost lever is about getting creative and perhaps walking the path less travelled for success.

Pull the Levers with Care

The 5 cost levers for outsourced services represent an individual and collective strategy for cost savings in the outsourced services space.  Pulling one alone would be effective, and using all of them in some way could deliver also deliver great results.

To find out more about these cost levers, and to access expert advice on how to use them, register for the Everest Group sponsored webinar 5 cost levers to pull right now with your outsourced services, to be broadcast on Thursday May 7th 2020 at 2:30pm GMT. To find out all the information you need, including how to sign up, visit the Procurious website or click here.