Communicating the value of procurement to your organization
What value do you personally add to your organization as a procurement professional? How would you answer if a newly appointed CEO of your organization asked that question?
Have you invested the time, effort and mental energy to accurately determine what values you provide? You should both know and be able to easily communicate these values to others.
Have you determined if and how you add more value than someone else who might be competing for your job — inside or outside the organization? Even in governmental organizations, there is an economic requirement that every member of the organization produce more value than they consume. Do you? Consider that the only roles that cannot be outsourced in a government organization are the policy-making roles — and those roles are usually contested every election cycle.
Please do not say that you save the organization money! The most efficient way to save money is not to spend it. Government organizations obtain revenues through taxes and/or fees to accomplish specific goals for their constituents. Very few governments really want to save money; however, most want to get the highest utility for the money they receive from the taxpayers and stakeholders. One of your roles in public procurement is to invest these taxpayers’ and/or stakeholders’ resources in order to obtain the best return on that investment. A related question: “How do I and the organization measure that return on investment?”
Saving money is so easy a computer can do it! There are some very exciting, yet chilling, developments about the use of software “bots” to search the Web for the best price and availability and then to place the order for the products. The only human intervention needed is for someone to establish and input the minimum requirements — like your client. (Read Daniel Pink’s book, A Whole New Mind, to see what this means!)
Here are some suggestions to prompt you to think about and determine what values you personally provide. This short list will help stimulate your thinking and analysis. Some ideas may not apply to your specific environment, and a multitude of others could be added to the list.
What can you do to increase the value (utility) of others’ time? Time is the most precious commodity in the world. Everyone has exactly the same amount of time, yet few of us seem to have enough time for everything we want to accomplish.
Most of your clients are generally in a service area other than procurement. They have specific talents, skills, knowledge and experiences that qualify them to perform their tasks to serve both their business unit’s mission, goals and objectives and the organization’s overall mission. If the clients are investing their time getting quotes or handling a formal solicitation process, what part of their specific technical roles are not being accomplished? What is the opportunity cost to the organization for employees to perform a procurement process instead of the technical processes for which they were hired?
By efficiently and effectively performing procurement processes in a way that assists your clients to accomplish their missions, you are adding value to the organization. You should know (and be able to clearly and succinctly communicate) the legal requirements, the processes, the risks and the impacts of a poorly performed procurement action better than your client. Your client should know the technical requirements, risks and benefits better than you. When everyone collaborates on the project and all parties perform their specific roles, then the outcome brings more total benefits to the organization than the total costs of the inputs.
Successful procurement professionals should have a holistic viewpoint of the marketplace for the products and services for which they are responsible. While your client may have more specific knowledge, including price and availability, about a particular product or service as it relates to his technical area, your holistic outlook will provide a greater degree of risk mitigation to both the client and to the organization.
In the recent past, we have seen how the rapidly fluctuating price of energy has impacted almost every product and service. However, the impacts are not equally distributed among products and services. The price and availability of some products and services are more stable and independent of short-term market price changes than others. Products and services that have long or convoluted supply chains seem to have more pronounced price changes than the changes in their related energy costs.
Does this general and specific knowledge of the markets add any value to your organization? Only if you keep current with the trends, changes and forecasts — and if you apply this knowledge and information to your clients’ specific current and future needs.
What other areas can you think of that add value to your organization? Start a notebook or file and write each idea down. Then begin the process of analyzing the goal to determine how to measure each. It is only the first of many continuing steps toward effectively communicating your value.
About the author
Kenneth D. Hayslette, CPPO, C.P.M., CPCM, is a trainer, writer, and independent consultant seeking to assist others in achieving success in their careers and lives. He has served more than 20 years in public and 18 years in private sector procurement and contracting.