Procurement Transformation: Déjà vu All Over Again

From the archive of blogs that I have written for the readers of the SCMR website, here is another of my favorites.

It's becoming a trend – and a cautionary tale as well.

A few weeks ago I received an inquiry through our corporate website from a company wanting our help assessing the skills and processes of their procurement staff. On the surface, the inquiry was not unlike others that we receive. I arranged a mutually-agreeable date and time for a phone call, and then turned to other business.

A few days later, when the conference call happened, I recalled Yogi Berra's famous quote: “it's déjà vu all over again.”

Let me explain. The inquiry was from a company who wanted, and needed, a fundamental assessment of its skills, processes, and organization. Doing a comprehensive assessment (and then constructing a roadmap for improvement) is exactly what most companies should do (at least once). In my experience, it is a critical first step in creating the capability for sustainable change and improvement.

What was awkward about this company's situation was the fact that just a few years ago they had hired – at considerable expense – a large consulting firm to do a high-profile “strategic sourcing program.” Today, in their own words, “we have nothing sustainable to show for the it.”

More of these painful situations are coming to our attention; thus the reference to Yogi Berra's famous quote.

It's easy to blame the consulting firm. After all, aren't they tasked with creating a sustainable transformation for their client? Shouldn't they be serious about transferring knowledge to their client? Shouldn't they only use well-seasoned and qualified experts on the project? Shouldn't their personnel actually know how to create sustainable change?

It's also appropriate to wonder if the client is at fault. After all, aren't they responsible for clearly defining expectations and deliverables? Aren't they responsible for actively managing the project and the consultants on site, and measuring the success or failure of the project – as it is progressing - versus the defined deliverables?

I've written in the past about the success factors in “actively managing consultants.” Our latest book, Next Level Supply Management Excellence (the sequel to the original Straight to the Bottom Line®), has a significant piece on this topic. It's worth your time.

But, to oversimplify: a successful procurement transformation requires having the right parties, acting as partners, following a proven assessment and transformation methodology, with a well-defined set of measurable deliverables, and a detailed workplan that ensures that the deliverables are achieved in a timely manner and on budget. And it also doesn't hurt if the consulting team has some “grey hair” members.

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