Get on the Treadmill — 6 Procurement Resolutions for the New Year

Spend Matters welcomes a guest post from Ryan Graham, Director in Procurement Practice at Archstone Consulting.

The New Year is upon us and it is time to start making the January promises that we will most likely break in February. Not surprisingly, I found the same areas we focus on in our personal lives also need attention in our professional lives. Take a look at the list of resolutions I compiled below and use the comment section to weigh in (or add any resolutions I missed).

  1. Get your 30 minutes of daily exercise (a.k.a. do general housekeeping): You have just finished or are in the middle of year-end reviews. Take a step back and devise your calendar for the year to address training, personal development, and career development. Think about what skill sets are most lacking on your team and plan a group training course. Investigate options for individual training courses for more specific areas of focus. Assess (collaboratively) where everyone is on his or her career path and establish dates now to hold progress discussions. And if your team works hard, organize some team building events for later in the year to reward them -- it will be upon you before you know it.
  2. Write a novel short story (a.k.a. review the source to settle process): The process has been in place forever. You've been meaning to take a look at it just like you've been meaning to change the light bulb in the garage for the past two years. Well, now's the time to grab a fresh bulb and a ladder and get to it. Look at the process, find low value activities, and be creative in cutting them out. Find long-duration activities and think about ways to reduce their time or run them in parallel with other steps. Look for compliance risks and develop low-overhead solutions to close the gap. We want to make sure the S2S process is comprehensive but streamlined - and then we need a concise graphical description of the process. Like you, your staff doesn't have time to read Leo Tolstoy or Ayn Rand but they can spare time to watch the movie.
  3. Balance the checkbook and organize the finances (a.k.a. define your major initiatives and align your resources ): We start each new year with a pile of projects on our desks. Being men and women of action, we dive into the pile headfirst. This year, before you pull on the diving cap, stop for a minute and gather a list of the major initiatives that will be coming down the pipe (this is a key element of a category management plan!). Think about the timing of those initiatives and how your resources will be able to line up against them (don't forget to include the inevitable deadline slippage). Do you lack the spend visibility to truly see what is on deck? We'll have some more posts soon to help you get your "spend vis" up to spec. But for now work on getting to at least a Santa Claus view (i.e., high level) of what is in store.
  4. Keep in touch with the family/Work on your love life (a.k.a. enhance stakeholder alignment): Like your loved ones, you never get to spend as much time as you would like with your internal customers. So why don't you start 2012 thinking about who your key stakeholders are and how you can interact with them more effectively? Are there opportunities to increase formal interactions such as forming a steering committee for a commodity and empowering the committee with a clear decision-making role? Could you be more deliberate about informal interactions checking in on a regular basis or around peak activity period? Identifying and recording these interactions is another key component of effective category management and a great way to improve your work love life.
  5. Pay your bills -- or would "refinancing the mortgage" be more appropriate these days? (a.k.a. give your suppliers their due): Start by identifying your most critical suppliers -- i.e., the ones that can have the biggest impact to your organization (you can use spend as a proxy but critical suppliers don't always have large spend and large suppliers aren't always critical). Think of ways they could be a better supplier for you. Then turn the tables and think about how you could be a better customer for them. Schedule meetings with them focused solely on account development (make issue resolution and performance evaluation meetings distinct from account development). Next, you should think about how you can most effectively manage non-strategic suppliers, but baby steps -- we need something to do in 2013.
  6. Cut out the sweets (a.k.a. eliminate waste): You've thought about your major initiatives and you've streamlined your processes. Now it's time to stop indulging those guilty pleasures that take up so much time but yield little benefit. It's time to maximize your ROI rather than maintain the status quo. No more sourcing office supplies for the third time in three years while marketing has no purchasing support. No more manual checks of every automated PO when a sample-set will do. Sometimes it's hard to spot the waste -- to find all the hiding spots you can perform an organizational assessment or benchmark your performance against other companies (or internal divisions) to identify gaps.

Don't you feel leaner/stronger/healthier/more fiscally responsible just from reading the list? Imagine how you will feel after you put it into practice. Even if you are only diligent setting these up in January and your execution is haphazard, you will derive value out of this project. But, with a little persistence, these efforts will continue long after the exercise bike is being used as a clothing rack.

- Ryan Graham, Director in Procurement Practice, Archstone Consulting

First Voice

  1. Jason Busch:

    Ryan,

    Awesome post.

    I might add another one (running related): do interval training! In the current climate, much of our success comes down to our ability to sprint and sustain fast momentum at certain points. Better train to support what it takes whether that’s really going 110% on studying a commodity market and having a POV on what it means and where it’s going or digging down an extra level (and getting dirty) around an issue holding back adoption of a given tool or process.

    Push yourself, recover, push harder … and get strong!

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