17 July 2008
Procurement should become more involved in the delivery, and not only the purchase, of management consultancy deals.
According to experts at a roundtable this month, procurement could add more value to deals if they provided more SRM support.
Hugo Were, a partner at Accenture, and president of the Management Consultancies Association (MCA), which hosted the event, said: "I would like to see procurement departments adding more value by seeing the deal through to the delivery. Once it has started, help see it to the end."
But according to Guy Strafford, client services director at buyingTeam, this is not in buyers' DNA: "There is a natural tendency in the procurement community to be more deal-orientated and deal-driven than they are designed to manage suppliers.
"Most of the issues of extracting value are not in the initial transaction but all the subsequent things. Procurement has to position itself to add value by managing them."
However, for Paula Sussex, CEO at Atos Consulting, it is rare to see procurement involved in progress reviews. "It's rare to have the commercial department sitting in there reviewing progress. Why is that? You do the deal and then you say 'I'm done, we're out of there'."
Stephen Hayers, vice-president, services procurement at BT, agreed this was the wrong approach. He said it was vital that buyers were able to tell the rest of the business how well or poorly consultancy deals had delivered on their promises.
He outlined BT's approach of holding regular meetings with suppliers and stakeholders to discuss progress and satisfaction.
But Meryl Bushell, formerly a CPO and now a consultant, argued this could present resource constraints for buyers.
"If you only have 25 people running the procurement department with a spend of £5 billion a year, how on earth are they going to do that and manage the in-life at the same time?"
And while most participants agreed there had been changes in the way procurement approaches buying consultancy over the past few years, problems remained over the best way to track value across a deal's life, the best contracting structure to reward both parties and procurement's increasing role as "internal consultants" to their business on deals.