Procurement teams can bear the brunt of much of the financial responsibility within a company.
Sourcing supplies, creating project specs and delving into negotiations are all regular tasks in the life of a procurement team.
If you want to ensure your procurement team has the resources to be the best they can, follow these 10 simple steps.
The best teams are comprised of those that can work independently. While they’re able to seek help or clarification from others, they understand when it’s appropriate to make their own decisions and take accountability.
In order to make this possible, you have to ensure that your team knows what is expected of them. If they understand and can act in accordance with the company guidelines, then they’ll have the confidence to work more independently.
Mistakes can still happen, but if you’re able to reframe these and impart new information then they will still have the confidence to act on their own.
Teams that are truly effective have strong communication links. They’re more efficient, as they can quickly pass information and explain the root of any issues. This cuts right to the heart of the concept, instead of requiring long email chains with essays of communication.
You may want to experiment with different communication methods within the team to find out which works best. If email is eating up a lot of your colleagues’ time, then you might want to try out an instant messenger like Slack.
Use Best Practice
The business of procurement is becoming ever more tightly regulated, with more transparency required. These regulations change rapidly, with new rules to block poor procurement practices from spilling over into government tenders.
This could potentially impact your firm’s ability to handle government contracts in future. You don’t want to miss out on these opportunities, so stay on the side of best practice. Practice what you preach here too; if your team is aware of a leader cutting corners then they will be more likely to do so.
Establish what best practice looks like for your organisation and distribute this information throughout the procurement team hierarchy.
Making sure that all members of your procurement team have completed an industry standard qualification (like those from the Chartered Institute of Procurement and Supply) will not only help your team adhere to best practice - they'll be empowered to champion best practice at every level of your organisation.
Prompt Forward Thinking
At the outset of a procurement project, you have the whole timeline free to create a process that will work. This is the time to consider any issues that may arise, as you have the luxury of really thinking about the choices.
This is a quality that you also want to instil in others on the team. Being backed into a corner and up against a deadline can really increase the financial burden of a project, as you’re forced to prioritise speed over cost.
This is not to say that last minute issues will never crop up, but you’re actively teaching your team to anticipate and solve these before they do.
Prioritise Supplier Relations
As the buyer, you may think that you’re in an elevated position compared to the supplier, but you should still be fostering good supplier relations. This gives you the edge in your negotiations and may even bring you a better price than hard bartering tactics.
With positive supplier relations, it’s possible to adopt a more collaborative approach with your suppliers. This allows you to use their expertise and create more efficient processes between your organisations.
Both parties benefit from this arrangement. If you want to make the most of these relationships, then each member of the team must be practicing the same levels of supplier relationship management.
Select the Right Candidates
Bringing in the right people can be the real tipping point for your procurement team. With the right attitudes, experience and people on your team – the whole department can be much more effective.
Selecting the right candidates at interview can be tricky, but we have you covered with this blog. Balancing personality and experience when selecting the newest member of your team is hard, but not impossible!
Be sure to monitor their progress as they get acquainted with the role and mentor to ensure they become a shining star.
Provide Accredited Training
The impact of formal training on the workplace can’t be overestimated, as you build good team members up to be exceptional. Within procurement, the Chartered Institute of Procurement and Supply (CIPS) is the established body for these qualifications.
These qualifications give procurement professionals additional knowledge that they can use in their day-to-day roles. They’ll learn all about supplier relations, negotiations and other actionable skills to improve their performance.
As well as providing a qualification for the individual, the entire team can benefit from this accreditation status. Pooled knowledge and internationally accredited qualifications can even impress outside customers, giving your team a commercial edge.
Conduct Regular Process Audits
Even if you think that your team is doing a great job, you should still be looking for areas of improvement. Process audits can make your workflows leaner, with less wastage of time and resources on avoidable processes.
Being aware of where these resources can be saved isn’t possible without the process of auditing. By cutting processes that waste resources, you can instead use them on more important responsibilities.
Output Information and Insights
Don’t keep all your procurement knowledge and information siloed; share it with the rest of your organisation. This can give them the tools that they need to improve their own processes, as they gain further understanding of other departments.
If your team works across departments, then there should be a regular retroactive assessment of how the teams work together.
For example, a department you work with repeatedly places a procurement request too late for a preferred supplier to deliver meaning that you must use a costlier one. Break down this cost to the department and give them more realistic timescales to allow procurement with the preferred supplier. Making this team aware of the implications saves both time and money in this case.
Taking these supplier insights all the way up to the C-suite will also provide clarity on market trends, supplier innovation and supply-chain risks. Procurement professionals must also wear an advisory hat at times, so don’t be afraid to take this insight to the boardroom.
Look Outside of Convention
Some of the most successful procurement teams borrow ideas from other cultures, teams and industries. They’re not afraid to step outside of convention and innovate new practices. Though not all these innovations will be instantly successful, experimentation can bring windfalls in productivity.
Making agile, effective teams a reality can only happen if you’re actively engaged in developing these practices. Trial and experimentation are required to figure out what works for your team, so stay invested in these practices.
Building a world-class procurement team takes time and resources, but these improvements can reap significant rewards. Develop, improve and assess your teams to give your organisation a strategic advantage over the competition.