Procurement Professionals: Rubber Stampers or Mission Control

The Inside Track

News & Reviews of the latest Celerant Corporate Event

Procurement Professionals:Rubber Stampers or Mission Control?How Procurement can add real value to the process of buying Business Improvement Services

SPEAKERS: PAUL VINCENT, ACTING CHAIR OF THE CONSULTANCY PURCHASING GROUP AND MANAGING DIRECTOR,

INSIGHT SOURCING SOLUTIONS. JOHN WELLWOOD, MANAGING DIRECTOR, 100% EFFECTIVE TRAINING & CONSULTANCY.

CATHY JOHNSON, VICE PRESIDENT, CELERANT CONSULTING VENUE: TRINITY HOUSE, TOWER HILL, LONDON

The Inside Track


“When consultants engage with Procurement Professionals it should be a meeting of minds, but too often it’s a meeting of agendas.” Cathy Johnson Celerant Consulting UK

Paul Vincent is Acting Chair of the IBC Consultancy

Purchasing Group and the owner and Managing

Director of Insight Sourcing Solutions Ltd, a company

which specialises in helping organisations buy and sell

Business Improvement services more effectively. Paul

established Insight in 2009, following a successful

24 year career in commercial and operational

disciplines at BT Group plc. He has over 13 years

buying and global category management experience

and has been responsible for the delivery of many

high profile business change programmes.

John Wellwood is an international Master Black Belt

who has consulted in over 13 countries, trained over

1000 people in Lean Six Sigma and run projects in

almost every area of business and industry. John set up

100% Effective Training & Consultancy in 2000 to

offer open, in house and online training at all levels, as

well as consultancy and advice in business improvement.

Since that date the company has worked across the globe

with organisations that include BT, BAA, Caterpillar,

Volvo, Jaguar, Nissan, Renault, Norwich Union,

Trelleborg, Alstom and Valeo.

Cathy Johnson is a Vice President at Celerant Consulting.

During her previous 7 years in Telecommunications

and 10 years in Operational Consultancy, Cathy has

worked across the whole value chain and led a wide

range of assignments throughout Europe in the

FMCG, Manufacturing, Pharmaceuticals,

Telecommunications and Financial Services sectors.

2 CELERANT CORPORATE EVENT

Profiles

t is often claimed, by internal stakeholders and external suppliers alike, that when it comes to buying Management

Consultancy services, ProcurementProfessionals care too much about priceand too little about the potential valuethat can be added.

It’s also perceived that they generallyhave so little knowledge, understandingor interest in the business issues that liebehind the Improvement Project that is tobe put out to tender, their practicalinvolvement in the actual buying processshould be restricted to the concluding offormalities at the end.

In this context, and in association with theInstitute of Business Consulting (IBC) andthe Consultancy Purchasing Group (CPG),Celerant Consulting was delighted to sponsor

‘The Knowledgeable Buyer -

What difference would it make?’

What combination of knowledge andunderstanding would a ProcurementProfessional need to possess in order tobe invited into the process much earlier?And how might this subsequently influence the way each party approachesthe commercial and contractual negotiationsto ensure that the project can and will besuccessfully delivered?

The conference was hosted and introduced by Caroline Lumb, Head of the IBC and the guest speakers were Paul Vincent, Acting CPG Chair andManaging Director of Insight SourcingSolutions, John Wellwood, ManagingDirector of 100% Effective Training &Consultancy and Cathy Johnson, VicePresident at Celerant Consulting.

It was held at Trinity House, overlookingThe Tower of London, and among theorganisations represented were: AmericanExpress, Aviva, Barclays Capital, BritishCouncil, BT, Legal & General, LloydsBanking Group, Manpower UK, Pfizer,Premier Foods, Prudential, RWE Npower,Schroders, Severn Trent Water, Shell,Societe Generale, Tesco, The Co-operativeFinancial Service, The Foreign Office, TheWalt Disney Co, United Utilities, Vodafoneand Westminster City Council.

“ The skills required to be a good Procurement Professional are the same as those required to be a good Consultant - which includes understanding that what people want isn’t always what they need.”

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CELERANT CORPORATE EVENT 3

The Inside Track


Executive Summary

wo key challenges need to be overcome for a Procurement Professional to become ‘The Knowledgeable Buyer.’ The first

is the simple question of inclusion. You haveto move from being engaged at the end ofthe line to close things out, to being involvedwhen a need is first identified. However, tobecome an integral part of the end to endbuying process, Procurement Professionalsneed to show that they can effectively aid astakeholder in their decision making and relatemost appropriately to the supply market.The second is a question of approach. Youobviously have to protect corporate termsand conditions to ensure that the businessachieves best value for money, but you havedo this by implementing effective processes,not unnecessary bureaucracy.

Making it happen ‘The Knowledgeable Buyer’ has to focus theirinvolvement and influence on achievingsuccessful engagement outcomes, notsimply squeezing an extra 1% from thecosts which may turn out to be counter-productive. An ‘outcome’ rather than‘deal’ focus will naturally help ensure you achieve best value for money. Achieving successful engagement outcomesmeans being proactive and having your radarswitched on at all times:

Anticipate Business Improvement needs:They will rarely feature in a category strategy, so you have to be able to predictwhere needs may emerge during the yearahead by identifying those parts of yourorganisation which face the biggest challenges. You need to leverage yourmanagement chain to learn about emergingproblems and track the organisationalmovements of key executives - especiallyat certain times of the financial year.

Monitor the political landscape: Who seems to have inherited a problem?Who needs to be rescued or wants support?

Tune into the urgency of business needs:When Business Improvement needs doemerge, they’re not suited to a long, drawnout selection exercise, so a high degree ofsupply filtering must be done in advance. Youtherefore need to recommend the selectionprocess that is most likely to deliver the ‘bestfitting’ choice. You’ve also got to keep in mindthat Business Improvement engagements arealmost always phases of work, and not allthose phases need to be bought at thesame time or indeed from the same firm.

Help shape the scope of work: Internal clients can sometimes be blindsidedby the scale of the challenge and spendinsufficient time on root cause analysis,so you should be alert to the impact thiscan have on the scope of work requiredand help to qualify perceived needs. Shareknowledge of past projects and/or externalcase studies to offer advice on engagementoptions. The critical thing is to help themdefine the specific outcomes required.

Recommend the ‘best fit’ supply options:Who has your organisation used before andhow did they perform? Are they still just ascapable now or has something changed?If an alternative choice is required, youhave to know how widely to cast the net.

Contribute to setting the key milestones:The core principle here is obviously paymentby outcomes or results, but this needs to beappropriately applied. Projects need to berealistically achievable and to take accountof the ‘real’ baseline.

Support the delivery of project outcomes:Once a supplier has been selected, you haveto help create the environment for successby practically supporting ‘on-boarding.’ Thisincludes staying on top of how things areprogressing and spotting potential issuesbefore they become escalations.

Ensure there’s a feedback loop: It’s important to remember that no Consultancywants to be known for unsuccessful engage-ments. So a feedback loop is vital. Tie feedbackto payment if you can, but be reasonableand remember, feedback is a 2-way street.Things can’t change overnight, but the benefitswill be enormous. You'll become a trustedbusiness advisor and your organisation’sBusiness Improvement programmes willachieve their optimum outcomes.

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“The knowledgeable buyer will focus their involvement and influence in achieving successful engagement outcomes.”

Going Against The Flow

The ‘Knowledgeable’ Procurement Flow

Consulting Firm

Great Idea

Internal Client

Need/Budget

Internal Client

Need/CostProcurement Facilitate Discussion

Selection & Contract Terms Consulting

FirmProposition/

Cost

The typical Consultancy-Internal Client-Procurement Flowneeds to change, says Paul Vincent. Procurement Professionalsmust deliver business value much earlier in the buying cycle.

Validating the Consultants Not all Consultants are incredibly clever,so don’t always believe them when theysay they’re qualified Black Belts or expertsin Kaizen. It’s also a good idea to ask abouttheir last 3 assignments, their recruitmentpolicy, their utilisation figures and imperativethat you find out exactly who will be deliveringthe programme. You might get the ‘A Team’in the pitch, but will you get them in thetrenches? If not, make sure you meet ortalk to the people you will get.

Validating the Consultancy One of the most interesting questions hereis whether or not they use their approach toBusiness Improvement in their own business- and if not, why not? How do they measuresuccessful outcomes for a programme andare they prepared to open up about pastprogrammes that didn’t hit their targetsand explain where and why things wentwrong? It’s all about risk-reward, so whatguarantees are they prepared to offer thatwhat they say will work will work? There’s no magic wand in any of this, ittakes time, effort and a gut instinct. Youhave to look beyond the showmen andsee the real people. Effective consultantsare experts, coaches and trainers.


What are the characteristics of an effective BusinessImprovement Consultancy, asks John Wellwood, and how can you validate them during the buying process?

Recognising The Right Partner

t’s never easy to find the right Consultancy for a project. Mostof the time you only ever meetthe Partners or the Senior

Consultants and they won’t be doing theactual work. Add to that the fact that everyConsultancy approaches things differentlyand the questions mount. You don’t wantto take any risks in case you get it wrong,but at the same time, you’re looking forsomething different.

Time isn’t normally on your side either.When Business Improvement needs arise,people want action and they want it fast,so you can't draw out the process. That’swhy it’s important to get a feel for the marketin advance. We all agree that price aloneisn’t a good measure of quality, but what is?

The characteristics of a 100% Effective Consultancy:Philosophy: The best Consultanciesalways want to pass on their knowledgeasap and help the business elsewhere.They don’t have a rigid model or a singularway of doing business, they adapt to theclient's culture and way of working. Theyunderstand the risk-reward relationshipand will put their money where theirmouth is. They’ll also won’t be afraid tellyou if they can’t do something. Honestycomes right at the start.

History: It’s a given that they’ll have a

great website that informs you all aboutthe different industries they’ve worked in,their key people and the case studiesthey’re most proud of, but the truth isanyone can put together a great website,so you have to dig deeper. Will they letyou meet their past clients? Can theydemonstrate the sustainability of theirsolutions? Have they ever operated in asimilar culture to yours? And what abouttheir people? Are they employed from adiverse range of backgrounds or are theyall company clones?

Influencing Skills: This is one of thebiggest differentiators. A 100% effectiveConsultancy must have fantastic peopleskills and an ability to build confidence andrapport at all levels of your organisation.Business Improvement projects require achange of behaviours and people need tobelieve that those changes are for thebetter. So don’t be afraid to ask yourselfthe very human question ‘Do I get on withthem?’ because if you don’t, the chancesare no one else will either.

Technical Ability: The nuts and bolts - canthey run different methodologies and ifthey can, will they be sustainable? Do theyreally understand your issues and yourculture? Have they got war stories?

Character: All projects involve teamwork,so are they actively looking to learn fromyour internal clients? Will they challengetheir assumptions and draw the best outof them. It’s vital that they do becausebeing open and honest is the quickestway to build effective teams.

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Effective Business ImprovementConsultancy Outcomes

+ =

Through theuse of the

right tools &techniques

Through effective change management &

influencing

Results ofimprovement

projects

Quality of thesolutions

Acceptance of the organisation

Executive Summary

“You might get the A Team in the pitch, but will you get them in the trenches?”

The Inside Track



Executive Summary

hen we begin talking to organisations about Business Improvement initiatives we often find that the outcomes

they want are ill-defined or not defined atall. They might be clear about how manypeople they want trained, or how manyprocesses they want changed, but that’s allabout the inputs. What’s more important isthe end game. What will the organisationlook like when the programme has finishedand how will people behave differently?

Define the Precise OutcomesYou can’t get to where you want to be ifyou don’t know where you are. So everyBusiness Improvement programme muststart by examining the processes that currently exist. How are they being managedand how can they be improved? What aboutthe people? What skill sets do they haveand what are they capable of achieving?

Not every Consultancy comes in becauseyou need their skills or knowledge.Sometimes you need quick results,momentum or a project managementcapability, but by having a collaborativedialogue around what’s important to you,what we’re trying to achieve and how weget to that result, you’re dramaticallyincreasing the chances of success. So froma Consultancy perspective, the earlier inthe engagement process that these honest,open conversations take place the better.

Divide the decision process into moremanageable chunks Procurement Professionals must encouragetheir internal clients to be very precise

about what it is they’re trying to achieveand then help them define the processthey have to go through to find whatthey’re looking for. Is it just a skills gapthey’re trying to fix? Or do they want aprogramme that significantly changesthings? Slicing the opportunity into fourmanageable chunks makes these conver-sations much easier and can be doneeither with the Consultancy or internally:

Discovery: High level view of the improvementopportunity and the business case.

Baseline Analysis: Quantification ofimprovement potential.

Design & Deploy: Process improvementsdefined and quick win installations.

Implementation: Financial, operationaland behavioural results delivered.

Balance the Risk and Reward There are two things to remember herefrom a buying perspective. The first is thatdelivering results cannot be done by theConsultancy alone. It also has to be doneby your internal clients, so whether theylike it or not they have a real stake in theprogramme. As soon as you put aConsultancy in a position where they’regoing to be paid by results only, you’reautomatically putting your internal clientin the same position - and they might notthank you for that.

Giving someone a tough target with verylittle support means you can end up drivingthe wrong behaviour and giving someone

a lax target with lots of support can havethe same effect. Equally, if you give aConsultancy a target which is too easy, it’snot challenging and you probably won’tget the best out of them. So it’s importantto know exactly which behavioural changesare going to drive the programme and thenwork with the Consultancy to get the rightbalance of risk and reward. The second thing to remember is that fora Consultancy to be able to commit to thefinal outcomes in the process, they have toclearly understand how your organisationworks, what the size and scale of changeis that they’re embarking on and what thelevers are that they're going to have to useto actually achieve those changes. So theywill need as much upfront raw data as youcan give them.

Sustainability must be a Key Outcome There’s little point in anyone engaging aConsultancy to drive quick upticks if thecost savings are then going to disappearas the organisation drifts back to its oldway of working. Nor is there any point inengaging a Consultancy that drives thingsincredibly hard for a while and thenleaves without having transferred any of their knowledge into the organisation.

An effective Consultancy needs to be continually making itself redundant byembedding Continuous Improvement intothe organisation and leaving behind a teamof internal ‘Change Agents’.

Achieving this requires them to guarantee:Engagement: Defining what needs tochange, with what benefit, and then

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Ensuring A Win-Win Scenario

Consultants and Procurement Professionals want to deliver thebest Business Improvement Programmes, says Cathy Johnson,so how do they help each other achieve that?


“The task of a good Business Consultancy is to make themselves redundant.”

selling the change to those who simplydon’t believe it can or must happen.

Training: Training people in the initialtools required for change.

Guidance coaching: Spending time in the relevant work place to monitorprocesses and challenge NVA activitiesand the root causes. Coaching the teams,delegating the monitoring task to supervisorsand managers and coaching them in howto drive change.

Coaching the coaches: Ensuring that thetaskforce and clients are coaching theirpeople and challenging targets.

Coaching sustainability: Testing sustainability.

Defining and tracking results to ensure ROI. How do you know you’re going to get theROI you want? Consultancies will all tellyou they can get it, but how are they goingto monitor this and show that during thecourse of the project they’re actuallydelivering what they said they would vswhat they said they would cost over theproject duration. And it’s not just ROI onthe input costs of their daily rate, it’s ROIon your total investment.

An absolutely robust tracking system istherefore essential and it must include anevaluation methodology that shows yourinternal financial people that the improve-ments that have been sold to you are hitting the bottom line. Similarly from anoperational, bottom up perspective, thepeople within the project have to understandexactly what actions they’re going to haveto take to deliver those improvements, sothey can see the direct impact that activity onthe ground is having on your financial results.

Managing the Emotional Journey of ChangeOrganisations often struggle with thisbecause it’s not very tangible, but there isa direct correlation between results andhow you manage the emotional journeythat people go through. Many change programmes fail apart at the ‘disbelief’stage shown on the chart opposite.

So you want a Consultancy that will managethe emotional journey, as well as managingthe other results, because there’s a hugedifference between people saying ‘Weknow what a KPI is’ and ‘We know what itmeans to use this KPI.’ Asking a consultancywhether they regularly put something likethis in place also adds an extra level ofcredibility when it comes to finding out more about their successful projects,because the journey of delivering a programme is just as important as theprogramme itself. The fact that a projecthas been closed is one piece of information,but information about how that projectwas closed is significantly more important.

Business Improvement success is a function of what you put into a projectand how it’s going to be delivered. It’salso a matter of working collaboratively to bring in different skill sets at differenttimes, asking the right questions throughoutthe process to both the Consultants andyour internal clients, having clearlydefined outcomes and a hard end game to achieve them. That’s how ProcurementProfessionals deliver the best value backto the business.

The underlying journey means measuring progress along the way is critical to ensuring the results are delivered

Developing Experience Practice & Learning Performing

Acceptance20%

Use40%

Compliance60%

Understanding80%

Ownership100%

MISTRUSWatching

DISBELIEFProtecting

HOPEFULContributing

ANGRYWithdrawing

CAUTIOUSLYPOSITIVEEngaging

UNCERTAINTYCo-operating

SELF-CONFIDENTGiving

PRIDETake-over

Q&AThe Inside Track


n the Q&A session, delegates probed the Speakers’ interlockingthemes and the impact they hadon the Procurement - Consultant

- Internal Stakeholder relationship.

Rosalind Barbier, Senior ProcurementManager at a FTSE 100 Financial ServicesCompany, asked how many ‘KnowledgeableBuyers’ Cathy Johnson had come acrossas a Consultant?

CJ: That’s a really tricky question to answerin a room full of Procurement Professionals.Before today obviously, I have specificexperience of just 2. One worked in anorganisation which we've worked with for 8 years, so that’s a real partnership.It’s a significantly large organisation andthis individual works with all sorts of consultancies, but he understands wherewe add value and that it's not just aboutthe input, it's about the output. The otherone is someone who has a very broadview of what it means to deliver this typeof thing. At the other end of the scale, I’ve come across a lot of people who justgo through the typical tick sheet and ifyou ask any questions that are off the ticksheet the response is ‘Well I’m not reallyhere to answer outside questions, so I’mnot going to answer that.’ I’ll just qualifythat by saying that I work primarily in theprivate sector. I’ve have some experiencein the public sector and when you’ve got a system whereby you have to explicitlyjustify what you’re buying and how, thesystem is likely to be more rigid.

Sophie Dixon, Senior ProcurementManager at American Express, wantedPaul Vincent’s view on how best toengage with internal stakeholders?

PV: I would suggest 3 things. First, don’tbe afraid. They are not always in possession

of as much intellect as they think they have.Let me tell you a story. It’s a true story, soI'll try and not give too much away. Seniormanagers who engage Consultants oftencompletely lose their mind in terms ofwhat represents good value for money. I had a situation where a senior managerwanted someone to help them run thepolitics of their Leadership Team andwhen I was approached to rubber stamp, I thought the decimal point was in the wrongplace in terms of the numbers that werethere. They wanted to pay a particularindividual thousands and thousands ofpounds on a retainer to do something whichwasn’t particularly difficult or challenging.Why? Because that person had a reputation.They almost had some kind of underwritingrecognition within the organisation thatmade it important to engage them.

When I spoke to them about what it wasthey were actually getting, why they werepaying this money, all those sorts ofthings, they started to open up. So you’vegot to be prepared to have what I call areal business conversation. Rather thansaying I can't work this through from aProcurement benefit, try and approachthem on a business level and say, whatare they giving you that you haven’t got,that you really need, and that meansyou’re prepared to spend 2, 3, 4 timesmore than you have to? You’ve got to beprepared to have that conversation.

The second point is that in a lot ofinstances, they really are just focussed onthe immediate requirement, so they don'tthink of things. Insurance, indemnity,intellectual property, they don't thinkabout that because all they want is some-thing that’s going to help them. So if youcan actually highlight some of the thingswhich they're taking a risk on, how vulnerable they are by going down a

particular path, then I find that in myexperience you get traction.

The third thing is, never ask them whatthey want. I would really never go and say,how can I help you? What you need to dois go in and say, this is what I understandabout your needs, the type of partneryou’re looking to work with and this ishow I can offer you value. Now obviouslyyou need to pick different types of peopleto do it with. We talked earlier about spotting the dynamics of different peoplemoving to different roles. If you say thatto the people who actually need you, forexample someone who takes over a newarea, you’re giving them some informationthat they don’t have. They’re going to bechurning over the stones, you give themthe information they don’t have, theywon’t have been impacted by the spin oftheir leadership team that everything isgreat and all of a sudden you become atrusted advisor. It’s not an overnightchange though. You've got to keep at it.

Caroline Lumb, Head of the Institute ofBusiness Consulting, wondered what JohnWellwood thought about the impact of e-portals on the process of Consultancyselection?

JW: There’s obviously a place for e-portalsbecause it allows procurement to collateinformation by asking very precise questionsabout what a Consultancy can offer, butthe problem is that it plays very much intothe hands of the big guys - because theyhave all the stuff you ask for. The smallercompanies may or may not. The otherproblem is you’re asked questions in thesethings which you try and fill it in, but if youdon’t know the organisation because you’venever worked with them before, how canyou possibly answer a question about howwe might deploy, when we don’t know


Extracts from the Q&A

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&Aanything about your culture, we don’tknow anything about how you've workedin the past or how you want to work now?I think it’s best to use the e-portal as away of getting to know people to find arange of Consultants or Consultanciesthat you would have as a panel to choosefrom. Then when you actually have arequirement, you would get 3 or 4 of themin the room to explain what’s going on,what your requirement is and fill in thehuman side.

All consultancies have a fantastic clientbase and they all have fantastic case studies.So meeting them enables you to dig deeper,because I think we’ve all got an inbuiltability to assess whether people are anygood or not. So when you meet them, youmight end up thinking ‘You’re going to putthat guy in my site?’ He’s never worked inour industry before or he’s never workedin this kind of culture before’.

Another dynamic is how many projects havethey actually completed? To complete aproject they have to come up with a solutionand they have to implement it. You woulddefine what a completed project is right atthe start - we’ve reduced this or increasedthat and we’ve run it for 6 months and hadno problems and so on. The control point isthat the project is complete when the solutionis embedded in the organisation. That tellsyou whether or not they’ve had enoughinfluence to get everyone to accept it.

A Consulting industry delegate, asked the floor how they educated their usersand clients to achieve the best level of benefits from the Consultancy programmes they purchase?

CJ: We’re in a fortunate position because allof the programmes we work on are outcomesbased and we make a commitment to those

results. So the conversation about benefitsrealisation, monitoring progress and ‘havingsomething to work against’ comes up veryearly. The other question that comes up earlyis ‘You might say we’ll make a significantsaving, but how are you going to cash thecheque?’ So we also build in a rigorousProgramme Management structure that saysit’s absolutely essential that we track variousKPIs weekly - and that’s non-negotiable.

The majority of projects will have a steeringgroup of some kind and they will usingthose KPIs and we actually challenge andcoach that process right the way through.So everyone understands what the objectivesare at the definition stage. If you split aproject into 4 milestones, I’d say that itprobably takes until milestone 2 beforesomething is really understood, milestone3 before you start getting the kick back on‘well we’re not really sure if that’s comethrough, because now we’ve understood howto measure it’ and by the time you get tothe end of the project it is there. It’s beeninternalised and it’s now a sustainable wayof working. It’s not easy, but it’s a processwe insist on going through.

Nick de Voil, Director, De Voil Consulting,wanted to know if Celerant ever hadClients whose objectives change duringthe course of an engagement?

CJ: We have Clients who try to change theresults or the outcomes that they're lookingto achieve. We have a lot of organisationswhere the circumstances change during thecourse of the project. Where for example, agross scenario is in place that says ‘We’regoing to improve by X% and sell Y% morewidgets’, then unfortunately those Y%widgets can’t be sold because there justisn’t the market for them. That happensquite regularly and that’s where I go backto the absolute need for a benefits tracking

mechanism across the Project Management.If that’s seen as a collaboration betweenthe Client and the Consultancy and forexample, from a procurement perspective,the right metrics have actually been setup to measure success, it’s a dynamicprocess and you can have a conversationthat says ‘The goalposts have changedbecause of these reasons.’

We won’t change the baseline of where we’vecome from, but we will amend the activitiesand outcomes that we’re trying to worktowards to make sure that we don’t justrigidly go down the rail track of ‘This isthe project’ when the business has alreadyturned off in a different direction. So it’sreally important to have a regular dialogueabout ‘Is this really what we are still trying toachieve?’ If the outcomes or the objectiveschange, the programme needs to reflectthat, but not in a way that lets either thebusiness or the Consultants get off lightly.

Jonathan Self, Buying ManagerConstruction at Tesco, asked Paul Vincentif the concept of ‘The Knowledgeablebuyer’ really was that revolutionary?

PV: Evolutionary might be a better word.What we’ve been talking about today are2 key points. The closer integration betweenProcurement and Consultancy, and linkedto that, the point about risk-reward in theprocess. The way I see it, if the BusinessImprovement and Procurement functionsare closer in terms of the objectives andwhat we’re really trying to achieve, then thesetting of that risk -reward relationshipwith the Consultant against the outcomeswill be that much easier. So revolutionaryis probably the wrong word, evolutionaryis the way I’d see it. Having said that ‘TheKnowledgeable Buyer’ is still revolutionaryfor the majority of organisations.


“Senior managers who engage Consultants often completely lose their mind in terms of what represents good value for money.”Paul Vincent

The Inside Track


After the conference, Celerant hosted a Corporate Dinner where delegates could exchange ideas on ‘The Knowledgeable Buyer.’

Rosalind BarbierSenior Procurement ManagerFTSE 100 Financial Services Company

What are the challenges of buying BusinessImprovement services in your organisation?First of all, it’s about having visibility of thepipeline of requirements. That way you can giveyour internal stakeholders a measured view onthe best way to define those requirements, thebest way to source solutions and the best way todefine what success looks like.

I believe that Procurement should be involvedin the buying of Business Improvement servicesand in most major projects they are. The challengeis about having advanced visibility of what mightbe on the agenda, because projects sometimes seemto come out of nowhere. Clearly they can’t come outof nowhere, but they often seem to. Then, because

of the high degree of sensitivity or confidentialityaround these projects, Procurement doesn’t necessarilyhear about them until quite a long way down thechain. So another challenge is to pull Procurementcloser to the centre of the business. It needs to earnrespect in the business as a trusted business partnerand a true commercial partner. To me that wouldbe Nirvana.

So ‘The Knowledgeable Buyer’ is the way forward?Yes. I think we’ve all got a very good vision of what‘The Knowledgeable Buyer’ is, the question is howdo we achieve that? I believe it’s an evolutionaryprocess, particularly when you remember thatprocuring Business Improvement services is quitea new thing anyway. Procurement started off buyingvery concrete things, but with Consultancies orLegal Services there’s a much greater human factorinvolved. That’s part of the evolution.

What did you find most useful about today?The thing that I really value is that it’s good toget out of your own little box and meet withlike-minded professionals. A lot of the topicstouched on today reinforced what I was alreadyaware of. There are always some nuggets that comeout of it, but what’s really good is the networkingopportunity. It's good to pool experiences andknowledge and it makes you realise that you’renot alone with these challenges.

What’s also been really good about this forum isthe bringing together of the buyers and the providers- and recognising that we have a lot in commonand we can help each other because we’re actuallyunexpected allies. Assuming the Consultancy hasgood intentions, we are completely aligned as towhat the outcome should be. What’s more, if weget this right, the potential for helping businessand the broader economy is really excellent.


Reviews

Procurement Category ManagerUtilities Sector

What are the challenges of buying BusinessImprovement services in your organisation?It’s about influencing our internal stakeholders.That’s the big issue for us. Historically, Procurementhaven’t really managed Consultancy Spend. The company itself has grown primarily throughacquisition, so people have come from very differentbackgrounds and from different organisations thatdo things very differently - and they’ve been allowedto do continue with that. So to get that stakeholderbuy in to look at something in a more alignedand commercial way has been quite a challenge.

I would say that we’ve developed very good relationships with the Consultancies that we usewhen we’re engaged. It’s that issue of up frontengagement. We’re often engaged at the end and wecan add value there, but it’s the end to end processthat I’m more interested in. We have a great of

capability within the Procurement function andits a slow burn, but I think we’re getting there. I’ve been looking after Consultancy Spend sincethe beginning of the year and we have made realprogress. It’s almost a case of ‘Show me, don’t tellme,’ so we’ve worked on a number of initiativesthis year, on a number of tender activities wherewe've been able to demonstrate value, and fromthat we’ve secured more opportunities to supportthe business in its requirements.

We don’t just have to provide a framework, wehave to provide the framework that’s right forour company. It’s all very well having theoreticalideas about how things would work, but it’s got towork in practice. Not every model fits every company.

So ‘The Knowledgeable Buyer’ is the way forward?Absolutely. I think we’ve got a lot that we can givein this area. Talking specifically about our company,we’ve got a number of people in our Procurement

function who are, I would say, already ‘KnowledgeableBuyers.’ It’s the opportunity to actually demonstratethat and add real value that is the challenge. What did you find most useful about today?I think the general interaction has been really good.Although it sounds rather glib, it’s almost the casethat what I heard today wasn’t necessarily anythingnew, but a reinforcement that as an organisationwe are not alone with this issue. Not necessarily thechallenges that we face in this particular category,but hearing other people from other companies andalso the Consultancies who have a lot of the sameissues and problems. For me it was almost areassurance that even if we don’t have all theanswers, we’re not unique.

Principal Category Manager Telco Procurement Company

What are the challenges of buying BusinessImprovement services in your organisation?It’s about credibility. As a buyer you need to buildinternal credibility and demonstrate that you canadd some value. Once you do that, you can getyourself engaged at the early stage of a projectand be involved where it counts. A great exampleof this for me was where someone in the organisationhad recently pre-selected. It came through to my teamand they said: ‘We just need to put this contractin place.’ But we went back and challenged theirassumptions. Now in the end the result didn’tchange and the price didn’t change, but the guyfed back to us that what was brilliant was that‘You challenged us to think about things and youforced us to write down what the requirementsreally were. Now we know what it is we’re goingto get - we didn't really know that before.’ It’s thatkind of thing you have to leverage. Sometimespeople are looking for help and sometimes they’re not.It depends on their motivation. At Vodafone we’ve

drawn some key areas, particularly in finance,where there have been some pretty strong winsfor us. And therefore we’re perhaps more trustedin those areas. In other areas, people are beingemployed and it’s a specialist area and they don’tnecessarily know anything about Procurement.They like to take a decision and get on with itand not be held back by process. So it’s very muchabout selling the value of what the process adds,rather than stepping in and saying ‘No we’re notgoing to do this, because we’re the police.’

It’s also recognising that it’s not just about cost,because it’s not a commodity you’re buying.There’s a deal we’re closing at the moment forexample, where the supplier that we’re going togo with is by no stretch of the imagination thelowest cost supplier, but they’re the ones who knowthe most about the subject and can deliver whatwe want. In this instance, we’ve also been veryingrained with the business owner, so we’ve beenable to step through their concept and it wasgreat because there’s a relationship there andwe’re a trusted advisor.

So ‘The Knowledgeable Buyer’ is the way forward?Definitely. The other angle of course is thatmany of the consultants are also our customers.If you route that into the broader relationship,you’ve got a customer relationship, a supplierrelationship and a Business Improvement relationship going on. Those things can’t exist asstatic concepts, so you have to take a balancedview of how you're going to work with theseorganisations.

What did you find most useful about today?What was great for us was to hear a Consultancysay ‘These are our experiences of the Procurementfunction, good and bad.’ That’s really useful andsomething you don’t necessarily hear people beingtoo honest about. It was nice to hear that and thenhave a conversation afterwards to tease out somemore of the details.


“Attitude is a little thing that makes a big difference.”Winston Churchill

Americas + 1 781 674 0400 Belgium + 32 (0) 2 762 52 38 Denmark + 45 35 45 90 01

Finland + 358 10 396 8800 France + 33 (0) 1 56 69 53 00 Germany + 49 (0) 211 58 33 00 33

Netherlands + 31 (0) 20 570 5400 Norway + 47 22 43 29 23 Sweden + 46 (0) 8 670 6579

United Arab Emirates + 971 (0) 2 406 98 77 United Kingdom + 44 (0) 20 8338 5000

celerantconsulting.comCelerant Consulting Holdings Limited. Registered Office: Avalon House, 72 Lower Mortlake Road, Richmond, Surrey TW9 2JY, United Kingdom.

For over 20 years, Celerant Consulting has delivered successful, sustainablechange for world leading companies. Our expertise covers the entire spectrumof the Operations Management ecosystem, with a core focus on PerformanceImprovement and Behavioural Change Management. Every project is a strategicpartnership where we get down on the ground to identify and analyse a Client’smost significant business challenges, then work with them to drive up results.We implement customised solutions that capitalise on existing systems, processesand people - and deliver substantial benefits. We change business for good andover 90% of our Clients say they would work with us again.

Procurement Professionals: Rubber Stampers or Mission Control

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