The Olympics – Money Always Matters, in Procurement as Well as Sport

In the UK, the Olympics has been a welcome diversion from the pressures of Brexit, a collapsed opposition Labour Party, a new Prime Minister and a stubbornly huge government deficit. Coming second in the medals table is undoubtedly worth celebrating, particularly for those of us who remember the dark days when you could easily name every British gold medal winner. At Atlanta in 1996 that was very easy,  Redgrave and Pinsent with our one and only gold, and we finished below Algeria and Norway in the medal table.

Now we head China, Russia, and Germany in the table, and perhaps most impressively GB had gold medal winners in more different sports than any other country. But has it been worth the £543 million invested since the last games in London four years ago? That's around £9 per citizen across the country, and I guess most people would feel they have had £9 worth of pleasure in the last three weeks from the exploits of the team.

But I have some sympathy with the argument of those like Richard Morrison in the Times. He pointed out that whenever "the Arts" (the National Theatre or Royal Opera House perhaps) get public money, there is always a lot of noise about access for all, or getting a more diverse audience for events, whereas Olympic funding is absolutely elitist.

For instance, he says, the equestrian teams have been given £18 million over four years, and we don't see big moves to attract disadvantaged or ethnic minority kids from Tower Hamlets or Rotherham into the jumping arena. And cutting the funding for sports like basketball on the grounds that we are unlikely to win a medal shows admirable ruthlessness in some ways, but hits a sport that the inner-city kids might actually take up - unlike sailing, rowing or modern pentathlon.

The whole idea that the Olympics inspires participation, that there is a trickledown effect to more people taking part in sport, did not seem to be sustained after London. Let's hope it has more effect this time around. The gym on Saturday afternoon was certainly busier than usual, although that seemed to be mainly middle aged men, shamed perhaps by the amazing bodies on display over the past two weeks and looking to recover a few of their long-hidden stomach muscles!

But this discussion is really intended to be all about what we can learn from the Olympics, with a procurement slant. Let's just cover the first and absolutely key learning now, then we'll come back tomorrow with more.

Today's lesson follows on from the discussion above - and it is that money really does matter. As we said above, GB has spent a fortune on Olympic sport and is reaping the rewards. The correlation between the investment which flowed (mainly from lottery money) over the last 20 years and increased performance is crystal clear. Whatever you think about the National Lottery  -  and random gambling like that is basically a tax on stupidity, as someone once said - it has paid off in terms of medals.

The same applies when we look at procurement performance. If your organisation truly wants to be near the top of the procurement medal table, and genuinely be "best in class", or "world leading" or however you define it, you do have to invest and spend some money. I'm sorry, but if you don't or won't provide good salaries and benefits to staff, invest in effective and appropriate systems and tools, and spend money on training and development, then at best you can hope to have an adequate, not a leading procurement function.

But here's a good question. How many of us, going for an interview for a CPO or similar senior role, ask questions about those issues? Not just our own prospective salaries, but what the wider structure looks like. How many ask what the budget is for systems, or how much per head is spent on training? Looking back, I don't think I did on most occasions. But it does matter.

With our Olympians, having the best cycling or rowing equipment possible, getting the best gymnastics or swimming coaches in the world, and funding competitors to be full-time athletes, have all contributed to the success. But that all costs real, serious money. We wouldn't expect Laura Trott to win the Omnium on my old beaten-up bicycle; why would we expect our procurement team to beat the world with 20-year old first generation eProcurement systems and a training budget of £200 a head per year?

We'll be back tomorrow with some more Olympic lessons.

First Voice

  1. Craig Knowles @ Market Dojo:

    Interesting article and I agree that many who join businesses procurement teams don’t ask these vital questions.

    In your example of the £18 million invested into equestrian there is a further underlying issue of the elitism. I heard a father on the radio discussing dressage. His wife, is a renowned trainer and his daughter recently competed at the European championships. He was stating the money invested for equestrian sports was even more elitist and that young potential Olympians (we aren’t talking about disadvantaged children, we are talking about individuals that are likely to represent their nation on the highest of stages) have to pay in the thousands to even compete at events. That’s not including the training, the horses and further costs. A significant amount of the £18 million is given to the likes of Nick Skelton (58-year-old GB olympian) and others who are close to the very inner political circle of the sport.

    Perhaps in the same way we look at a business. We should be looking to invest the money not on individuals, not even on a team or department in a sports succeeding, but on putting a plan in place for the entire nation. So those young individuals (and only young individuals) are given the aid to help them in their progress. If we only win half the gold medals at the next Olympics, but the proportion of the population actively competing in sports doubles. Then isn’t that the greater victory?

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