The Knowledgeable Buyer

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 News & Reviews of the latest Celerant Corporate Event

“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

Profiles 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.

2

CELERANT CORPORATE EVENT

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.

t is often claimed, by internal stakeholders and external suppliers alike, that when it comes to buying Management Consultancy services, Procurement Professionals care too much about price and too little about the potential value that can be added.

I

It’s also perceived that they generally have so little knowledge, understanding or interest in the business issues that lie behind the Improvement Project that is to be put out to tender, their practical involvement in the actual buying process should be restricted to the concluding of formalities at the end.

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

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

It was held at Trinity House, overlooking The Tower of London, and among the organisations represented were: American Express, Aviva, Barclays Capital, British Council, BT, Legal & General, Lloyds Banking Group, Manpower UK, Pfizer, Premier Foods, Prudential, RWE Npower, Schroders, Severn Trent Water, Shell, Societe Generale, Tesco, The Co-operative Financial Service, The Foreign Office, The Walt Disney Co, United Utilities, Vodafone and Westminster City Council.

‘The Knowledgeable Buyer What difference would it make?’

What combination of knowledge and understanding would a Procurement Professional need to possess in order to be invited into the process much earlier?

And how might this subsequently influence the way each party approaches the commercial and contractual negotiations to ensure that the project can and will be successfully delivered?

“ 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.”

CELERANT CORPORATE EVENT

3

The Inside Track News & Reviews of the latest Celerant Corporate Event

Going Against The Flow The typical Consultancy-Internal Client-Procurement Flow needs to change, says Paul Vincent. Procurement Professionals must deliver business value much earlier in the buying cycle.

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 have to move from being engaged at the end of the line to close things out, to being involved when a need is first identified. However, to become an integral part of the end to end buying process, Procurement Professionals need to show that they can effectively aid a stakeholder in their decision making and relate most appropriately to the supply market.

The second is a question of approach. You obviously have to protect corporate terms and conditions to ensure that the business achieves best value for money, but you have do this by implementing effective processes, not unnecessary bureaucracy.

T

Making it happen ‘The Knowledgeable Buyer’ has to focus their involvement and influence on achieving successful engagement outcomes, not simply squeezing an extra 1% from the costs which may turn out to be counterproductive. An ‘outcome’ rather than ‘deal’ focus will naturally help ensure you achieve best value for money.

Achieving successful engagement outcomes means being proactive and having your radar switched on at all times: The ‘Knowledgeable’ Procurement Flow Consulting Firm Great Idea

Internal Client Need/Budget

4

Procurement Facilitate Discussion Selection & Contract Terms

CELERANT CORPORATE EVENT

Internal Client Need/Cost Consulting Firm Proposition/ Cost

Anticipate Business Improvement needs: They will rarely feature in a category strategy, so you have to be able to predict where needs may emerge during the year ahead by identifying those parts of your organisation which face the biggest challenges. You need to leverage your management chain to learn about emerging problems and track the organisational movements of key executives - especially at 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?

Recommend the ‘best fit’ supply options: Who has your organisation used before and how did they perform? Are they still just as capable now or has something changed?

If an alternative choice is required, you have to know how widely to cast the net.

Contribute to setting the key milestones: The core principle here is obviously payment by outcomes or results, but this needs to be appropriately applied. Projects need to be realistically achievable and to take account of the ‘real’ baseline.

“The knowledgeable buyer will

Tune into the urgency of business needs: When Business Improvement needs do emerge, they’re not suited to a long, drawn out selection exercise, so a high degree of supply filtering must be done in advance. You therefore need to recommend the selection process that is most likely to deliver the ‘best fitting’ choice. You’ve also got to keep in mind that Business Improvement engagements are almost always phases of work, and not all those phases need to be bought at the same time or indeed from the same firm.

focus their involvement and

Help shape the scope of work: Internal clients can sometimes be blindsided by the scale of the challenge and spend insufficient time on root cause analysis, so you should be alert to the impact this can have on the scope of work required and help to qualify perceived needs. Share knowledge of past projects and/or external case studies to offer advice on engagement options. The critical thing is to help them define the specific outcomes required.

Ensure there’s a feedback loop: It’s important to remember that no Consultancy wants to be known for unsuccessful engagements. So a feedback loop is vital. Tie feedback to payment if you can, but be reasonable and remember, feedback is a 2-way street.

Things can’t change overnight, but the benefits will be enormous. You'll become a trusted business advisor and your organisation’s Business Improvement programmes will achieve their optimum outcomes.

influence in achieving successful engagement outcomes.”

Support the delivery of project outcomes: Once a supplier has been selected, you have to help create the environment for success by practically supporting ‘on-boarding.’ This includes staying on top of how things are progressing and spotting potential issues before they become escalations.

Recognising The Right Partner What are the characteristics of an effective Business Improvement Consultancy, asks John Wellwood, and how can you validate them during the buying process?

Executive Summary t’s never easy to find the right Consultancy for a project. Most of the time you only ever meet the Partners or the Senior Consultants and they won’t be doing the actual work. Add to that the fact that every Consultancy approaches things differently and the questions mount. You don’t want to take any risks in case you get it wrong, but at the same time, you’re looking for something different.

I

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’s why it’s important to get a feel for the market in advance. We all agree that price alone isn’t a good measure of quality, but what is?

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

The characteristics of a 100% Effective Consultancy: Philosophy: The best Consultancies always want to pass on their knowledge asap and help the business elsewhere.

They don’t have a rigid model or a singular way of doing business, they adapt to the client's culture and way of working. They understand the risk-reward relationship and will put their money where their mouth is. They’ll also won’t be afraid tell you if they can’t do something. Honesty comes right at the start.

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

great website that informs you all about the different industries they’ve worked in, their key people and the case studies they’re most proud of, but the truth is anyone can put together a great website, so you have to dig deeper. Will they let you meet their past clients? Can they demonstrate the sustainability of their solutions? Have they ever operated in a similar culture to yours? And what about their people? Are they employed from a diverse range of backgrounds or are they all company clones?

Influencing Skills: This is one of the biggest differentiators. A 100% effective Consultancy must have fantastic people skills and an ability to build confidence and rapport at all levels of your organisation.

Business Improvement projects require a change of behaviours and people need to believe that those changes are for the better. So don’t be afraid to ask yourself the very human question ‘Do I get on with them?’ because if you don’t, the chances are no one else will either.

Technical Ability: The nuts and bolts - can they run different methodologies and if they can, will they be sustainable? Do they really understand your issues and your culture? Have they got war stories?

Character: All projects involve teamwork, so are they actively looking to learn from your internal clients? Will they challenge their assumptions and draw the best out of them. It’s vital that they do because being open and honest is the quickest way to build effective teams.

Validating the Consultants Not all Consultants are incredibly clever, so don’t always believe them when they say they’re qualified Black Belts or experts in Kaizen. It’s also a good idea to ask about their last 3 assignments, their recruitment policy, their utilisation figures and imperative that you find out exactly who will be delivering the programme. You might get the ‘A Team’ in the pitch, but will you get them in the trenches? If not, make sure you meet or talk to the people you will get.

Validating the Consultancy One of the most interesting questions here is whether or not they use their approach to Business Improvement in their own business - and if not, why not? How do they measure successful outcomes for a programme and are they prepared to open up about past programmes that didn’t hit their targets and explain where and why things went wrong? It’s all about risk-reward, so what guarantees are they prepared to offer that what they say will work will work?

There’s no magic wand in any of this, it takes time, effort and a gut instinct. You have to look beyond the showmen and see the real people. Effective consultants are experts, coaches and trainers.

Effective Business Improvement Consultancy Outcomes Results of improvement projects

+

Quality of the solutions

Through the use of the right tools & techniques

=

Acceptance of the organisation

Through effective change management & influencing

CELERANT CORPORATE EVENT

5

The Inside Track News & Reviews of the latest Celerant Corporate Event

Ensuring A Win -Win Scenario Consultants and Procurement Professionals want to deliver the best Business Improvement Programmes, says Cathy Johnson, so how do they help each other achieve that?

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 at all. They might be clear about how many people they want trained, or how many processes they want changed, but that’s all about the inputs. What’s more important is the end game. What will the organisation look like when the programme has finished and how will people behave differently?

W

Define the Precise Outcomes You can’t get to where you want to be if you don’t know where you are. So every Business Improvement programme must start by examining the processes that currently exist. How are they being managed and how can they be improved? What about the people? What skill sets do they have and what are they capable of achieving?

Not every Consultancy comes in because you need their skills or knowledge.

Sometimes you need quick results, momentum or a project management capability, but by having a collaborative dialogue around what’s important to you, what we’re trying to achieve and how we get to that result, you’re dramatically increasing the chances of success. So from a Consultancy perspective, the earlier in the engagement process that these honest, open conversations take place the better.

Divide the decision process into more manageable chunks Procurement Professionals must encourage their internal clients to be very precise

6

CELERANT CORPORATE EVENT

about what it is they’re trying to achieve and then help them define the process they have to go through to find what they’re looking for. Is it just a skills gap they’re trying to fix? Or do they want a programme that significantly changes things? Slicing the opportunity into four manageable chunks makes these conversations much easier and can be done either with the Consultancy or internally: Discovery: High level view of the improvement opportunity and the business case.

Baseline Analysis: Quantification of improvement potential.

Design & Deploy: Process improvements defined and quick win installations.

Implementation: Financial, operational and behavioural results delivered.

Balance the Risk and Reward There are two things to remember here from a buying perspective. The first is that delivering results cannot be done by the Consultancy alone. It also has to be done by your internal clients, so whether they like it or not they have a real stake in the programme. As soon as you put a Consultancy in a position where they’re going to be paid by results only, you’re automatically putting your internal client in the same position - and they might not thank you for that.

Giving someone a tough target with very little support means you can end up driving the wrong behaviour and giving someone

a lax target with lots of support can have the same effect. Equally, if you give a Consultancy a target which is too easy, it’s not challenging and you probably won’t get the best out of them. So it’s important to know exactly which behavioural changes are going to drive the programme and then work with the Consultancy to get the right balance of risk and reward.

The second thing to remember is that for a Consultancy to be able to commit to the final outcomes in the process, they have to clearly understand how your organisation works, what the size and scale of change is that they’re embarking on and what the levers are that they're going to have to use to actually achieve those changes. So they will need as much upfront raw data as you can give them.

Sustainability must be a Key Outcome There’s little point in anyone engaging a Consultancy to drive quick upticks if the cost savings are then going to disappear as the organisation drifts back to its old way of working. Nor is there any point in engaging a Consultancy that drives things incredibly hard for a while and then leaves without having transferred any of their knowledge into the organisation.

An effective Consultancy needs to be continually making itself redundant by embedding Continuous Improvement into the organisation and leaving behind a team of internal ‘Change Agents’.

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

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

Training: Training people in the initial tools required for change.

Guidance coaching: Spending time in the relevant work place to monitor processes and challenge NVA activities and the root causes. Coaching the teams, delegating the monitoring task to supervisors and managers and coaching them in how to drive change.

Coaching the coaches: Ensuring that the taskforce and clients are coaching their people and challenging targets.

Coaching sustainability: Testing sustainability.

Defining and tracking results to ensure ROI. How do you know you’re going to get the ROI you want? Consultancies will all tell you they can get it, but how are they going to monitor this and show that during the course of the project they’re actually delivering what they said they would vs what they said they would cost over the project duration. And it’s not just ROI on the input costs of their daily rate, it’s ROI on your total investment.

An absolutely robust tracking system is therefore essential and it must include an evaluation methodology that shows your internal financial people that the improvements that have been sold to you are hitting the bottom line. Similarly from an operational, bottom up perspective, the people within the project have to understand exactly what actions they’re going to have to take to deliver those improvements, so they can see the direct impact that activity on the ground is having on your financial results.

Managing the Emotional Journey of Change Organisations often struggle with this because it’s not very tangible, but there is a direct correlation between results and how you manage the emotional journey that people go through. Many change programmes fail apart at the ‘disbelief’ stage shown on the chart opposite.

So you want a Consultancy that will manage the emotional journey, as well as managing the other results, because there’s a huge difference between people saying ‘We know what a KPI is’ and ‘We know what it means to use this KPI.’ Asking a consultancy whether they regularly put something like this in place also adds an extra level of credibility when it comes to finding out more about their successful projects, because the journey of delivering a programme is just as important as the programme itself. The fact that a project has been closed is one piece of information, but information about how that project was closed is significantly more important.

Business Improvement success is a function of what you put into a project and how it’s going to be delivered. It’s also a matter of working collaboratively to bring in different skill sets at different times, asking the right questions throughout the process to both the Consultants and your internal clients, having clearly defined outcomes and a hard end game to achieve them. That’s how Procurement Professionals deliver the best value back to the business.

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

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

Practice & Learning

Performing

Ownership

100%

PRIDE Take-over

SELF-CONFIDENT Giving Understanding

HOPEFUL Contributing

80%

MISTRUS Watching DISBELIEF Protecting

CAUTIOUSLY POSITIVE Engaging

Compliance

60% Use

40%

UNCERTAINTY Co-operating

Acceptance

20%

ANGRY Withdrawing

CELERANT CORPORATE EVENT

7

The Inside Track News & Reviews of the latest Celerant Corporate Event

Extracts from the Q&A n the Q&A session, delegates probed the Speakers’ interlocking themes and the impact they had on the Procurement - Consultant - Internal Stakeholder relationship.

I

of as much intellect as they think they have.

Let me tell you a story. It’s a true story, so I'll try and not give too much away. Senior managers who engage Consultants often completely lose their mind in terms of what represents good value for money.

I had a situation where a senior manager wanted someone to help them run the politics of their Leadership Team and when I was approached to rubber stamp, I thought the decimal point was in the wrong place in terms of the numbers that were there. They wanted to pay a particular individual thousands and thousands of pounds on a retainer to do something which wasn’t particularly difficult or challenging.

Why? Because that person had a reputation.

They almost had some kind of underwriting recognition within the organisation that made it important to engage them.

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

Q& Rosalind Barbier, Senior Procurement Manager at a FTSE 100 Financial Services Company, asked how many ‘Knowledgeable Buyers’ Cathy Johnson had come across as a Consultant?

CJ: That’s a really tricky question to answer in a room full of Procurement Professionals.

Before today obviously, I have specific experience of just 2. One worked in an organisation which we've worked with for 8 years, so that’s a real partnership.

It’s a significantly large organisation and this individual works with all sorts of consultancies, but he understands where we add value and that it's not just about the input, it's about the output. The other one is someone who has a very broad view of what it means to deliver this type of thing. At the other end of the scale, I’ve come across a lot of people who just go through the typical tick sheet and if you ask any questions that are off the tick sheet the response is ‘Well I’m not really here to answer outside questions, so I’m not going to answer that.’ I’ll just qualify that by saying that I work primarily in the private sector. I’ve have some experience in the public sector and when you’ve got a system whereby you have to explicitly justify what you’re buying and how, the system is likely to be more rigid.

Sophie Dixon, Senior Procurement Manager at American Express, wanted Paul Vincent’s view on how best to engage with internal stakeholders?

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

8

CELERANT CORPORATE EVENT

When I spoke to them about what it was they were actually getting, why they were paying this money, all those sorts of things, they started to open up. So you’ve got to be prepared to have what I call a real business conversation. Rather than saying I can't work this through from a Procurement benefit, try and approach them on a business level and say, what are they giving you that you haven’t got, that you really need, and that means you’re prepared to spend 2, 3, 4 times more than you have to? You’ve got to be prepared to have that conversation.

The second point is that in a lot of instances, they really are just focussed on the immediate requirement, so they don't think of things. Insurance, indemnity, intellectual property, they don't think about that because all they want is something that’s going to help them. So if you can actually highlight some of the things which they're taking a risk on, how vulnerable they are by going down a

The third thing is, never ask them what they want. I would really never go and say, how can I help you? What you need to do is go in and say, this is what I understand about your needs, the type of partner you’re looking to work with and this is how I can offer you value. Now obviously you need to pick different types of people to do it with. We talked earlier about spotting the dynamics of different people moving to different roles. If you say that to the people who actually need you, for example someone who takes over a new area, you’re giving them some information that they don’t have. They’re going to be churning over the stones, you give them the information they don’t have, they won’t have been impacted by the spin of their leadership team that everything is great and all of a sudden you become a trusted advisor. It’s not an overnight change though. You've got to keep at it.

Caroline Lumb, Head of the Institute of Business Consulting, wondered what John Wellwood thought about the impact of e-portals on the process of Consultancy selection?

JW: There’s obviously a place for e-portals because it allows procurement to collate information by asking very precise questions about what a Consultancy can offer, but the problem is that it plays very much into the hands of the big guys - because they have all the stuff you ask for. The smaller companies may or may not. The other problem is you’re asked questions in these things which you try and fill it in, but if you don’t know the organisation because you’ve never worked with them before, how can you possibly answer a question about how we might deploy, when we don’t know

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

Paul Vincent anything about your culture, we don’t know anything about how you've worked in the past or how you want to work now?

I think it’s best to use the e-portal as a way of getting to know people to find a range of Consultants or Consultancies that you would have as a panel to choose from. Then when you actually have a requirement, you would get 3 or 4 of them in the room to explain what’s going on, what your requirement is and fill in the human side.

results. So the conversation about benefits realisation, monitoring progress and ‘having something to work against’ comes up very early. The other question that comes up early is ‘You might say we’ll make a significant saving, but how are you going to cash the cheque?’ So we also build in a rigorous Programme Management structure that says it’s absolutely essential that we track various KPIs weekly - and that’s non-negotiable.

&A All consultancies have a fantastic client base and they all have fantastic case studies.

So meeting them enables you to dig deeper, because I think we’ve all got an inbuilt ability to assess whether people are any good or not. So when you meet them, you might end up thinking ‘You’re going to put that guy in my site?’ He’s never worked in our industry before or he’s never worked in this kind of culture before’.

Another dynamic is how many projects have they actually completed? To complete a project they have to come up with a solution and they have to implement it. You would define what a completed project is right at the start - we’ve reduced this or increased that and we’ve run it for 6 months and had no problems and so on. The control point is that the project is complete when the solution is embedded in the organisation. That tells you whether or not they’ve had enough influence to get everyone to accept it.

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

CJ: We’re in a fortunate position because all of the programmes we work on are outcomes based and we make a commitment to those

The majority of projects will have a steering group of some kind and they will using those KPIs and we actually challenge and coach that process right the way through.

So everyone understands what the objectives are at the definition stage. If you split a project into 4 milestones, I’d say that it probably takes until milestone 2 before something is really understood, milestone 3 before you start getting the kick back on ‘well we’re not really sure if that’s come through, because now we’ve understood how to measure it’ and by the time you get to the end of the project it is there. It’s been internalised and it’s now a sustainable way of working. It’s not easy, but it’s a process we insist on going through.

Nick de Voil, Director, De Voil Consulting, wanted to know if Celerant ever had Clients whose objectives change during the course of an engagement?

CJ: We have Clients who try to change the results or the outcomes that they're looking to achieve. We have a lot of organisations where the circumstances change during the course of the project. Where for example, a gross scenario is in place that says ‘We’re going to improve by X% and sell Y% more widgets’, then unfortunately those Y% widgets can’t be sold because there just isn’t the market for them. That happens quite regularly and that’s where I go back to the absolute need for a benefits tracking

mechanism across the Project Management.

If that’s seen as a collaboration between the Client and the Consultancy and for example, from a procurement perspective, the right metrics have actually been set up to measure success, it’s a dynamic process and you can have a conversation that says ‘The goalposts have changed because of these reasons.’

We won’t change the baseline of where we’ve come from, but we will amend the activities and outcomes that we’re trying to work towards to make sure that we don’t just rigidly go down the rail track of ‘This is the project’ when the business has already turned off in a different direction. So it’s really important to have a regular dialogue about ‘Is this really what we are still trying to achieve?’ If the outcomes or the objectives change, the programme needs to reflect that, but not in a way that lets either the business or the Consultants get off lightly.

Jonathan Self, Buying Manager Construction at Tesco, asked Paul Vincent if the concept of ‘The Knowledgeable buyer’ really was that revolutionary?

PV: Evolutionary might be a better word.

What we’ve been talking about today are 2 key points. The closer integration between Procurement and Consultancy, and linked to that, the point about risk-reward in the process. The way I see it, if the Business Improvement and Procurement functions are closer in terms of the objectives and what we’re really trying to achieve, then the setting of that risk -reward relationship with the Consultant against the outcomes will be that much easier. So revolutionary is probably the wrong word, evolutionary is the way I’d see it. Having said that ‘The Knowledgeable Buyer’ is still revolutionary for the majority of organisations.

CELERANT CORPORATE EVENT

9

The Inside Track News & Reviews of the latest Celerant Corporate Event

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

Rosalind Barbier Senior Procurement Manager FTSE 100 Financial Services Company What are the challenges of buying Business Improvement services in your organisation?

First of all, it’s about having visibility of the pipeline of requirements. That way you can give your internal stakeholders a measured view on the best way to define those requirements, the best way to source solutions and the best way to define what success looks like.

I believe that Procurement should be involved in the buying of Business Improvement services and in most major projects they are. The challenge is about having advanced visibility of what might be on the agenda, because projects sometimes seem to come out of nowhere. Clearly they can’t come out of nowhere, but they often seem to. Then, because

Procurement Category Manager Utilities Sector What are the challenges of buying Business Improvement services in your organisation?

It’s about influencing our internal stakeholders.

That’s the big issue for us. Historically, Procurement haven’t really managed Consultancy Spend.

The company itself has grown primarily through acquisition, so people have come from very different backgrounds and from different organisations that do things very differently - and they’ve been allowed to do continue with that. So to get that stakeholder buy in to look at something in a more aligned and commercial way has been quite a challenge.

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

10

CELERANT CORPORATE EVENT

of the high degree of sensitivity or confidentiality around these projects, Procurement doesn’t necessarily hear about them until quite a long way down the chain. So another challenge is to pull Procurement closer to the centre of the business. It needs to earn respect in the business as a trusted business partner and a true commercial partner. To me that would be 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 how do we achieve that? I believe it’s an evolutionary process, particularly when you remember that procuring Business Improvement services is quite a new thing anyway. Procurement started off buying very concrete things, but with Consultancies or Legal Services there’s a much greater human factor involved. That’s part of the evolution.

capability within the Procurement function and its a slow burn, but I think we’re getting there.

I’ve been looking after Consultancy Spend since the beginning of the year and we have made real progress. It’s almost a case of ‘Show me, don’t tell me,’ so we’ve worked on a number of initiatives this year, on a number of tender activities where we've been able to demonstrate value, and from that we’ve secured more opportunities to support the business in its requirements.

We don’t just have to provide a framework, we have to provide the framework that’s right for our company. It’s all very well having theoretical ideas about how things would work, but it’s got to work 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 give in this area. Talking specifically about our company, we’ve got a number of people in our Procurement

What did you find most useful about today?

The thing that I really value is that it’s good to get out of your own little box and meet with like-minded professionals. A lot of the topics touched on today reinforced what I was already aware of. There are always some nuggets that come out of it, but what’s really good is the networking opportunity. It's good to pool experiences and knowledge and it makes you realise that you’re not alone with these challenges.

What’s also been really good about this forum is the bringing together of the buyers and the providers - and recognising that we have a lot in common and we can help each other because we’re actually unexpected allies. Assuming the Consultancy has good intentions, we are completely aligned as to what the outcome should be. What’s more, if we get this right, the potential for helping business and the broader economy is really excellent.

function who are, I would say, already ‘Knowledgeable Buyers.’ It’s the opportunity to actually demonstrate that 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 case that what I heard today wasn’t necessarily anything new, but a reinforcement that as an organisation we are not alone with this issue. Not necessarily the challenges that we face in this particular category, but hearing other people from other companies and also the Consultancies who have a lot of the same issues and problems. For me it was almost a reassurance that even if we don’t have all the answers, we’re not unique.

Principal Category Manager Telco Procurement Company What are the challenges of buying Business Improvement services in your organisation?

It’s about credibility. As a buyer you need to build internal credibility and demonstrate that you can add some value. Once you do that, you can get yourself engaged at the early stage of a project and be involved where it counts. A great example of this for me was where someone in the organisation had recently pre-selected. It came through to my team and they said: ‘We just need to put this contract in place.’ But we went back and challenged their assumptions. Now in the end the result didn’t change and the price didn’t change, but the guy fed back to us that what was brilliant was that ‘You challenged us to think about things and you forced us to write down what the requirements really were. Now we know what it is we’re going to get - we didn't really know that before.’ It’s that kind of thing you have to leverage. Sometimes people 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 wins for us. And therefore we’re perhaps more trusted in those areas. In other areas, people are being employed and it’s a specialist area and they don’t necessarily know anything about Procurement.

They like to take a decision and get on with it and not be held back by process. So it’s very much about selling the value of what the process adds, rather than stepping in and saying ‘No we’re not going to do this, because we’re the police.’

So ‘The Knowledgeable Buyer’ is the way forward?

Definitely. The other angle of course is that many of the consultants are also our customers.

If you route that into the broader relationship, you’ve got a customer relationship, a supplier relationship and a Business Improvement relationship going on. Those things can’t exist as static concepts, so you have to take a balanced view of how you're going to work with these organisations.

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 for example, where the supplier that we’re going to go with is by no stretch of the imagination the lowest cost supplier, but they’re the ones who know the most about the subject and can deliver what we want. In this instance, we’ve also been very ingrained with the business owner, so we’ve been able to step through their concept and it was great because there’s a relationship there and we’re a trusted advisor.

What did you find most useful about today?

What was great for us was to hear a Consultancy say ‘These are our experiences of the Procurement function, good and bad.’ That’s really useful and something you don’t necessarily hear people being too honest about. It was nice to hear that and then have a conversation afterwards to tease out some more of the details.

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

Winston Churchill

CELERANT CORPORATE EVENT

11

For over 20 years, Celerant Consulting has delivered successful, sustainable change for world leading companies. Our expertise covers the entire spectrum of the Operations Management ecosystem, with a core focus on Performance Improvement and Behavioural Change Management. Every project is a strategic partnership where we get down on the ground to identify and analyse a Client’s most significant business challenges, then work with them to drive up results.

We implement customised solutions that capitalise on existing systems, processes and people - and deliver substantial benefits. We change business for good and over 90% of our Clients say they would work with us again.

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