SCAN, CLAN, hard core procurement and cerebral whimsy

Our first newsletter the other week seemed to go down quite well (don't stop reading, this isn't just  self -promotion) and we had some nice comments – also a few 'unsubscribes' that made me think 'why has he unsubscribed – thought he was my friend”.  (One of the reasons I avoid Facebook – can’t face the rejection…) If you didn't get it, you can subscribe via the link bottom right of this page. Only takes 30 seconds...

The comment I valued and enjoyed the most was from Dr Richard (Dick) Russill. Dick is a hero and mentor of mine, and has probably done as much as anyone alive in the UK to develop, promote and educate in the procurement field over the last 40 years as a trainer, writer, adviser, educator… Anyway, Dick said the newsletter was:

"a surreal mix of hard core procurement and cerebral whimsy."

That is going to be our new Spend Matters slogan and USP!

But, on a more serious note, way back in the mists of time, Dick invented and proposed the concept of CLAN as a procurement strategy and organisational structure for large organisations– the Centre Led Action Network. The basic premise (skip a paragraph if you know this) was an organisational design and operating approach for procurement based on a small procurement centre, probably including the CPO, setting strategy and gathering information from the centre of the organisation.

But the main procurement operations were to be carried out in a devolved fashion around the network of business units. Procurement staff would report locally, but with a dotted line to a CPO or equivalent in the centre. Lead category management responsibility would be allocated out around the procurement staff in the network, but with some guidance and loose control from the centre.

A few years ago, I decided to go for a new acronym and invented the SCAN – the Strategically Controlled Action Network. My argument was that CLAN suffered from being a bit woolly in practice; procurement people tended to take the local priorities as their main driver and the small team in the centre was often left with little real authority to drive collaboration or improvement. So SCAN looked at a structure with geographically devolved networks of procurement professionals – but with those people having line reporting to the centre and the CPO. More direct control could then be exerted over key activities.  I stick by that view although I have to say SCAN (certainly as a bit of procurement jargon) never caught on in the way that CLAN did.

But I've been thinking recently about how these and other potential organisational structures have been impacted by the development of procurement technology. Has the huge growth in capability of sourcing, P2P, spend analytics and other technology changed the view of the  optimal organisational structure for a leading-edge procurement function in a large organisation? (Or even perhaps across organisations, as for instance in the case of the UK Government's collaboration initiative).

So... we'll have a go at answering that question over the next week or two with some further posts aorund organisational structures, technology, and procurement strategy. Cerebral whimsy indeed....

Voices (3)

  1. Azizur Rahman:

    Is Centre led procurement and CLAN same thing?

  2. Flog:

    Peter, I didn’t really think about the name, however, when working within the public sector and later as a consultant, I’ve used the description Stragetic-CLAN which has the departmental reporting lines through the central ‘expert’ professional procurement function.

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