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11 May 2014 | Gurjit Degun in Las Vegas, US
Not talking about costs with stakeholders helped Amway drive compliance when transforming indirect procurement, the Institute for Supply Management annual conference in Las Vegas, US, heard.
Charen Buyce, the health and beauty company’s director of indirect global procurement, told delegates procurement cannot be the “budget police”.
“I think the way we got compliance is we stopped talking about cost," she said.
"We just said, ‘We’re just about your needs. Tell us what your needs are. Let us help you.’ And if you hire good supply chain people, they’re going to figure out the cost side. We care about cost but we know that our business partners don’t care that much about cost. They care about strategic reinvestment a lot.
“We’ve said we cannot be the police of the budgets because as soon as we are the police all 'pull' goes away. We might as well let everybody go, because they’re not going to participate anymore.”