Dodging the 'bail out'

26 November 2008

Blog pic By Jake Kanter

It seems more and more companies are requesting some form of government "bail out" these days. Look no further then the three giant US motor firms, Chrysler, Ford and General Motors (GM), who marched to Washington last week to ask for $25 billion.

As my web story yesterday reveals, they were turned down on the basis they didn't provide enough detail to back up their claims for cash. This struck me as being slightly absurd. If you're going to ask for such a vast sum of money, surely you should be able to explain your reasons to good effect? If not, as it would seem in this case, rather than reaching out an open hand while clutching their cap in the other, shouldn’t these companies be looking internally for the answers?

In fairness to GM, it did announce a number of "self help" measures, which included driving savings. But perhaps this is time for the procurement functions at the three companies to shout and wave their arms a bit more, to attract attention. Buyers have the skill not only to drive savings, but build cooperative, profitable relationships with key suppliers, suppliers that the automotive firms depend on.

Can procurement teams help their organisation avoid requesting a “bail out” package?

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