10 July 2014 | Paul Snell
It is too quickly forgotten in this age of increased automation and technology, that doing business has always been about building personal relationships.
What has changed, as this month’s cover feature points out, is that ‘positional power’, which was derived from a job title, academic qualifications or membership of a particular golf club, is on the wane. This has changed in procurement too. The days of buyers dictating terms to their suppliers are at an end, particularly with the constraints on capacity economists are predicting as the global economy improves. It will pay to be the ‘customer of choice’.
Instead there is more reliance on persuading and influencing techniques to get others to see your point of view. It’s not just businesses either, with the government’s ‘behavioural insights team’ (sometimes called the ‘nudge unit’) responsible for “encouraging people to make better choices for themselves”.
The majority of CPOs I talk to cite the ability to influence stakeholders (and the wider organisation) as one of the critical skills they demand of their staff, and expanding procurement’s influence over spend has even overtaken cost control as the profession’s priority for 2014 in one survey.
But don’t despair if you think you aren’t a ‘natural’ because these skills can be learnt – and you should find plenty of advice and tips in the article.
Building strong relationships with suppliers is nothing new (which is not to say it is not important), but would you be prepared to do away with the contract? McDonald’s has been working in this way for most of the 40 years it has operated in the UK, and you can find out how and why the fast food chain places importance on such a personal approach here.
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