The ninth sales trend for 2014 is ‘procurement need to be solutions salespeople too’.
The times are indeed changing with the function of procurement becoming increasingly important as a conduit, an orchestrator if you will, for the co-creation of value with suppliers and internal stakeholders as well as right down the value chain to the end consumer and back again.
No longer can procurement rest its case on ‘lowest cost’, ‘cheapest price’ or ‘supply of goods and services’; it must assume responsibility for the creation and delivery of real value beyond a price and general supply.
This sales trend highlights how the skills, knowledge and mindset of procurement professionals are being expanded to include the capabilities of highly competent solutions sales professionals.
The latest white papers, running commentary threads on LinkedIn procurement groups across the world, and procurement conferences and education bodies are all pointing towards procurement coming of age as a value creator and provider.
Nigel Wardropper, managing director, btTB and event director for the upcoming unique one-day event, Decoding the Buyer – unlocking the secrets of selling to procurement,says:
“In business today, value is about more than monetary worth. It’s about fitness for purpose, meeting needs and building reputation. And just as procurement has been expected to deal with cost, risk and change, it is also called upon to deliver value at every level.”
He goes on further to say that:
“The focus has shifted from cost avoidance, risk mitigation and compliance to pro-actively adding value and helping organisations do more with less – and do so quicker and more reliably in line with community expectations, government regulations and shareholder demands.”
So procurement has a choice – it can choose to be either a road block or a conduit to innovation, ideas, viable solutions that ensure their companies, shareholders, suppliers and customers succeed or not.
The smart procurement professionals, their teams and the organisations they operate in are taking advantage of this by engaging all stakeholders across the entire value chain. They see they need to reposition, rebrand the function and value of procurement.
However, many companies are lagging behind – the current reputation and perception of procurement by most suppliers and internal stakeholders is not good. Procurement is finding it hard to get traction and an audience with key internal stakeholders who are not seeing procurement as adding any value, or at worse being an impediment to progress. Many departments and supplier sales teams are finding ways to sidestep procurement so they can get to talk to each other about the ‘right stuff’ to help them achieve their goals and objectives.
Therefore procurement needs to move from being perceived as an operational revenue absorbing department to becoming advisers, partners and solutions providers with internal departments as well as suppliers.
Whether procurement is seen as an operational revenue absorbing role or an advisory role would depend on how well procurement positions itself throughout the organisation across the value chain.
What does this mean for supplier sales teams?
Hopefully, it means viable relationships based on trust, transparency and real results, unlike the ones they have had to put up with over the last 20 years or so. Smart procurement professionals will see suppliers as having a real stake in the organisation’s success – they will need suppliers’ sales teams working with them bringing knowledge, experience, ideas and innovations that will likely see the salesperson understanding more about their area of supply than procurement does.
Procurement realises that they will need to bring the suppliers’ expertise and innovations to internal stakeholders to help them not only to meet the organisations needs, but more importantly, allowing the organisation to meet the needs of their customers.
Nigel Wardropper says: “The co-creation of value with suppliers has potential to go even further – to benefit not just ourselves and our customers, but ultimately our suppliers, and even their suppliers. Working at the heart of category management as a team, with our suppliers and their suppliers, to put together a value chain to serve a common end consumer can offer greater value for all. In effect, competing against other supply chains.”
Remember, everybody lives by selling something.