Dear Procurement (Part 2): More work-from-home tips in the coronavirus era — like how to tackle asset management

Today we're going to review a few more activities that still have a large face-to-face component but that can be done as required while working from home — if you're willing to seize the day again.

We’ll focus on virtual ways to tackle contract negotiations, end-user product qualification, inventory & asset management, and project post mortems.

In Part 1 of this series, we began with tips on using cloud-based solutions — especially those that go beyond Zoom — to turn your sofa, kitchen table or even your bed into a mobile procurement command center.

We described how to take on the activities of category planning; vendor site audits; user groups and workshops; and internal category intelligence, supplier intelligence and market intelligence.

All of these were done mostly in person but can be done online — thanks to audio and video conferencing tools, mobile collaboration tools, and modern procurement and analytics platforms.

Now, let’s look at today’s topics.

Activity Historical Approach
Contract Negotiations Conduct in-person internal review sessions and negotiate directly with a final supplier — or two.
End-User Product Qualification Send the product to a testing lab in the office; have an expert or panel of evaluators rate it.
Inventory and Asset Management Receive product; tag it; deliver it to a supply closet/room or immediately distribute.
Project Post Mortem Collaborate, typically in a project room; conference in virtual attendees; document results.

All of these activities can be accomplished via modern technology (and various source-to-pay and related software solutions). That is, provided you've embraced technology and a new, distributed, virtual form of working (and use technology like Google Calendar to keep your time-zones straight).

Let's explore each briefly.

Contract Negotiations

Except in cases where an agreement is on supplier paper, typically you start the process by sending out a standard contract put together by legal based upon the award and inputs you provided. Then the process may unfold like this (or a variant): When the supplier sends back a counter-offer, the red-line contract, you get together in the room to analyze the divide, plan a response you can live with, ideally work out the BATNA (best alternative to a negotiated agreement), and prepare the counter-offer, and then send. If the next response is reasonable, you'll invite the supplier in for final negotiations, or conduct these virtually; if not, you'll repeat the process.

But there's no need to meet in person even internally. After all:

  1. a) the best way to identify the changes, and how far off they are, and whether they violate any organizational policies or add additional risk, is not to pour over dozens, if not hundreds, of pages of contract clauses and addendums, but run it through a modern contract analytics tool that can identify every change, its level of risk, and priority to address.
  2. b) the best way to come up with a BATNA is to use all of the RFI information and market information you have on alternative suppliers and run it through an analytics platform to figure out what your likely fall back position is.
  3. c) with all this data, you can easily have a meaningful discussion over a web video conferencing platform and compose a counter-negotiation through a modern cloud-based contract management or document management platform.
  4. d) when it comes time to involve the supplier, use the same process. You invite them into the conference platform and the contract management platform (in view mode).

End-User Product Qualification

You're probably wondering if all this self-isolation is causing at least some of us to lose it (we admit we are, to some degree). But we’re actually not strangers to remote work. In fact, since the early days of the internet, many of us have done at least some work remotely.

If you think about, if you're qualifying products for an end user, why are you doing them in an office environment? Even if the user is using them for work, these days, they're not using the products in a work office, they're using the products in a home office!

So one place to start to evaluate, test and inspect products is in the home — if you don’t need specific tools to analyze tolerances, engage in first article testing in a production capacity, etc.

Hence, depending on the category, order a few, send them to your staff working at home that would be representative users, and let them test them, inspect them and beat on them. Yeah, you might have to order a few more. Yes, shipping cost is a bit higher, but guess what, you'll have a better evaluation of overall quality if the supplier ends up shipping from multiple production batches to multiple locations!

And when the evaluators are done, they can submit all evaluations into the platform and associate them with the product and project, a combined review can be created, shared with the wider category/project/supplier management team, and then discussed in a video conference.

Inventory and Asset Management

Let's face it, the traditional inventory management approach is begging for disruption, especially when it involves a desktop inventory system and custom inventory tags — and someone walking around the warehouse, DC or any sort of facility doing activities that do not need to exist in an “ET phone home” world.

Valuable assets, like electronics, can connect to any type of network with a MAC address that you can use. Other valuable assets are going to have a serial number or manufacturer ID tag.  And modern, web-based inventory and asset management systems support all that.

You can also assign assets and tasks to departments, indicate the person the asset is assigned to, indicate where it is (which could be the person's home), the length of time it is checked out for (which could be indefinite), and if it is available for reassignment. Users can query the system for available goods, put in requests, and they can be transported or shipped from where they are to where the need to be without going through a useless central supply closet that just costs resources.

Project Post Mortem

You know that you need to discuss the project in person when all is said and done to collectively identify all the hitches, how they could have been prevented and what lessons should be learned.

But you know the best way to make a discussion effective? Prepare! Before the post mortem even begins, everyone should be asked to extend the documentation on what went wrong or didn't go quite as well as planned. Document the most likely reasons, and document ideas for improvement.

Then the post mortem leader should review, compile the key issues and points, some of the common suggestions, and send out a pre-discussion document to the team to get them thinking and prepared. And then do the post-mortem over web-conferencing, with the project leads updating the documents in real time. More gets discussed, more gets captured, less gets lost.   And they can even use newly identified best practices to update the plans and workflows in the tool for the next time around!

In Summary

Not only can you do the bulk of activity virtually and remotely, but you will find that if you embrace this new normal and a new way of working and start using more of the capabilities of modern S2P tools and platforms, you will actually perform as well or better than doing it the old way.

So you can look at this crisis as a huge challenge and a full stop to business — or as an opportunity to do business better than ever and lead your organizations out of this troubled time.

Carpe Diem Rursus!

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