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10.05.2016
Savings is not the only driver
For years, the Procurement function has sold itself as bringing Savings to the organization, but surprise, surprise this is not what the rest of the organization wants.
Savings is only one element that Procurement bring to the organization, we should be bringing fully vetted, secure and robust supply chains. I am not saying that we will not try to get the best deal for our organization, but the lowest price is not the be all and end all of Procurement.
We have all heard and seen some very scary examples where Procurement has changed suppliers or products which brought in Savings. However, this change might have brought problems because the goods were sub-standard, did not work on the machines, the chemical make-up of the goods meant that it was unsafe for human use, etc. So the cost to the organization was huge and even bigger for the Procurement function who suggested the change in the first place. The rest of the organization is understandably quite charry when Procurement talks about Savings because most of them know what happens when we chase Savings. Additionally, they may not be interested in Savings, what they are interested in is for the goods/stuff to work without causing problems for themselves and the organization.
So before you guys in Procurement try to convince the organization to do a project solely based on how much Savings it can generate, think again. Rather focus on what is important to your colleague and the organization and lead with this argument for why to do something and then figure out how to get the best deal for your Stakeholder, the organization and the Procurement function.
Procurement
Business Strategy
Savings
We are a Global Procurement, Supply Chain and Business Consultancy specialising in Supplier Vetting and Management, Business Analytics, Business Interpretation and Translations, Contracts Management,…
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