Leadership in IT Sourcing
Spend Matters welcomes another guest post from Jon Winsett, CEO of NPI, a spend management consultancy focused on delivering savings in the areas of IT, telecom and transportation.
Earlier this week, I had the pleasure of meeting with Peter Bregman, a renowned CEO consultant, best-selling author and frequent contributor to Harvard Business Review, Fast Company and Forbes. What I like about Peter is that his leadership insights are powerfully simple. When asked what sets great leaders apart, he shared two concepts that really hit home – especially for leaders in IT sourcing:
Great leaders have the ability to create space between an event and a reaction.
IT sourcing professionals are in the business of reacting. Whether it’s purchasing a new must-have solution for a particular division or upgrading support on a solution, every “event” requires swift action. Yet, the impetus is also the reason why most strategic sourcing efforts fall apart – particularly in contract negotiations where the pace is unpredictable and the stakes are high.
By creating space between an event and a reaction, IT sourcing has greater opportunity to engineer the desired outcome. In some cases, it’s paying a lower price and securing better discounts. In other cases, the desired outcome is better terms and conditions. Regardless, that space can now be filled with the analysis, insight and data that will create the desired outcome.
Great leaders focus less on improving weaknesses and more on promoting strengths.
American companies are trained to improve their weaknesses. It’s part of our performance management culture, and it pervades every aspect of business. As such, some leaders focus more on fixing issues than finding ways to showcase the strengths of their team.
This is highly evident in the IT purchasing process. Most IT sourcing groups lack insight into what other companies are paying for software, hardware and services. Some try to overcome this by conducting their own time-intensive price benchmarking exercises. Most don’t even know where to start, so they don’t benchmark at all. However, there are a select few that acknowledge their inability to conduct effective benchmarking exercises internally. Rather than waste time that could be spent on more impactful activities like vendor evaluations and supplier management, they turn to specialized outside resources to help with benchmarking. In effect, they are playing to their strengths and neutralizing their weaknesses.
IT sourcing is evolving and so are the leadership skills required to execute well. The ability to replace rushed reactions with “pause and engineer” will be the antidote to the increasingly complex IT purchase.