Help from outside - Supply Management

Help from outside

9 November 2010
Sourcing management consultancy is a highly controversial area. Aside from the issue of reputation, among many stakeholders, there are concerns of scope creep and seniority of the people who turn up to do the job (as opposed to those who sold the concept). As well as the idea that very often they turn up and tell the organisation what they already knew about themselves. The opposing view is they provide an objective, impartial view of the business and are sufficiently distanced from it to be free from office politics. Either way, this is high-cost stuff and hugely important. If the result of the consultation is going to (at least in part) influence the company’s direction, the outcomes have to be meaningful, relevant and measurable. Who better to set up such a contract than buyers, who, depending on the organisation, already manage up to 90 or 95 per cent of spend. However, as we discuss in this week’s cover feature (page 28), that isn’t the case for many organisations, where procurement is often overlooked in this area. And that is a pity as this category, as much as any other spend area, touches three crucial aspects of professional procurement: its reputation with stakeholders; its ability to build beneficial relationships with suppliers and power to influence an organisation’s direction. But to turn these aspirations into results buyers have to demonstrate their value to the chief exec, CFO or whoever appoints consultants. The question is how? And how to get started? For some buying departments the answer lies in the procurement consultants brought in. External help for a well-executed transformation could provide the very template for similar appointments across the business. There will be adjustments required, but a project with demonstrable benefits, controlled scope and budget that has delivered for the firm could be applied more broadly. If you have achieved that in your own department this could be an introduction to consultant contracts across the board.
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