Does a more commercial approach bring risks for Procurement Institutes?

We’ve been discussing the ISM acquisition of ADR US and earlier this week we brought CIPS into the debate. There’s no doubt both Institutes are looking increasingly at global opportunities, and at becoming more commercial in their attitude.

The positives are obvious. The market for procurement related professional services is vast, and growing strongly as developing countries take procurement and supply chain activities more seriously and look to professionalise.

So if Institutes can take a bigger slice of a huge pie, they will have more resources to plough back into benefits for members, or more “good works” – the public good requirement that Institutes have to follow to retain their charitable status.

And talking of members, David Noble, the CEO, announced some interesting new benefits last week. The first, CIPS Intelligence is a comprehensive online knowledge and information resource. There are three types of information – firstly, general content for anyone wanting to find out about the profession. Then, member-only information, with procurement papers free for CIPS members. Finally, “there is a raft of information from other management disciplines, which members will be able to download at a nominal charge, provided through our collaboration with Knowledge Brief”.

The next is a new Continuing Professional Development (CPD) tool, based on members setting up their own online account. And the third is the CIPS Recruitment partnership with four recruitment experts, Barclay Meade, Hays Procurement, Langley Search and Selection and Supply Management, which we’ve already covered.

All sounds promising, so we’ll take a look at initiatives numbers one and two shortly and report back.

So, back to the CIPS commercial strategy. All very sensible – isn’t it? But there are potential downsides.

- A more aggressive global approach might annoy other Institutes and threaten the harmony of the global Institute picture.  But there is probably plenty of work to go around, so while battles for world domination may be quite interesting to watch, this perhaps isn’t too significant in the greater scheme of things.

- Professional services firms may start to see CIPS as a more serious competitor.  If the large firms started losing work to CIPS or ISM, would they be as keen on their young consultants going through Institutes' education process? And smaller firms who partner with CIPS may be more hesitant if the Institute becomes more aggressive in the market.

- Then there’s the danger of losing charitable status – that seems unlikely, as long as CIPS takes basic precautions by continuing to show enough “public good” work.

- The biggest risk to my mind is that Institutes lose the affection and loyalty of their members. I can’t see people moving away from the qualification aspects of the Institutes’ offerings – they are valuable. But keeping the membership ethos requires something more; members may lose that feeling of pride and “belonging” if their Institute becomes a highly commercial entity.

- And finally, and related to this is the risk that Institutes stop being seen as the independent and authoritative voice of the profession. Let us give two examples.

I always saw Supply Management as the journal of the profession. My assumption was that if something happened that I should know about as a CPO, I would probably see it in Supply Management. As we know, that is no longer true. The magazine and website won’t feature anything that comes from a source they see as “competitive”, no matter how important or valuable it is to members. And that becomes a wider and wider field as the publishers behind the magazine now also, for instance, run the CIPS dinner and conference.  It won’t just be Spend Matters and Procurement Leaders that don’t exist as far as Supply Management is concerned.  So, in my opinion, Supply Management has lost its claim to being the voice of the profession, although I don’t think most CIPS members realise this. Yet.

It has also been noticeable how cautious CIPS has been in terms of responding to negative comments made by politicians about our profession. “Enemies of Enterprise” anyone? “Biased against UK firms”?

You might suggest that the lack of push-back is because CIPS is looking at potential income from Whitehall as and when the Procurement Academy is developed, and the CEO has associated himself so firmly with the Government’s procurement initiatives.  I'm not sure, but I do believe that 10 or even 5 years ago, the CEO would have spoken out more strongly in defence of CIPS members.

Losing the trust and faith of members is the big risk. The new initiatives mentioned earlier – along with a redesigned CIPS website, coming soon – would therefore seem to be the sort of positive moves that CIPS will need to make in order to balance the commercial drive and keep members satisfied.

Voices (4)

  1. Phoenix:

    I’ve made comments before about CIPS’s commercial interests taking the lead, while the ‘public good’ activities take a back seat. It can’t last forever, one of those will have to give. But what concerns me more is that CIPS is now so hamstrung from commenting freely on UK Government policy. Senior civil servants occupy a couple of places on CIPS’s Board and David Noble sits on the Government’s Procurement Board. So even though Supply Management can still run the odd piece that challenges Government (q.v. the cover story 3 issues ago), CIPS itself remains eerily silent and apparently unwilling to stand up for the 20% of its Members working in public service when they get slagged off by Ministers.

  2. Final Furlong:

    There are still firm indicators that CIPS is firmly routed in the dark ages (compared to some…).

    Two simple examples:

    – Supply Management still doesn’t provide Members with the option to reject the delivery of a physical copy of its rag. So while I can go on a website to stop all of the direct mail crap coming through my letter box, I still hear the familiar crunch of ‘huge glossy tomb hitting floor board’ (magnified by 50,000 members…) – I dare to think what their carbon footprint is…;

    – when one books onto a branch event one doesn’t get a confirmation email but a letter through the post reminding of not only the event booking but of the fact that I have paid nowt – again, no option to click an option which says “I am familiar with 21st Century technological advancements (like my i- phone and have no need to be reassured by a printed letter”

    On and up…

  3. Dan:

    Strange. I would have thought that CIPS management would be smarter than this. After all, who would be better placed to judge the benefits of collaboration over competition?

    Supply Management could be an excellent publication, a one-stop-shop for anyone who needed information on a range of subjects. Instead, its just one of the sites I browse (and one of the lower priority ones at that). By not allowing ‘competing’ sources they’re just making the publication less attractive, which will ultimately harm them commercially.

  4. Charles Dominick, SPSM, SPSM2:

    Peter,
    I give you credit for exposing CIPS for how they block content sources – arguably some of the best content sources – from their members. This shows self-interested, rather than member-focused, behavior. ISM does the same thing and, in my opinion, this is improper behavior for not-for-profit organizations. They certainly don’t behave like charities and should not get the tax benefits associated with being charities when they do business the way that they do. It’s only a matter of time before the good people of our profession realize their charade and focus on value rather than history.

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