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Enhancing the Fitness of Purchasing Departments - Analogies from Human Life

I am sure any stakeholder to a Purchasing department would rate or view their performance based on their experiences with this department. And obviously, stakeholders could be internal (CXO executives, user departments/budget owners, sourcing & procurement team members themselves etc.) and/or external (suppliers, auditors, consultants etc.).

Not so positive views could be "they are slow, they are impediments, signifying "thou shall not buy" attitude always; they just don't understand what value suppliers can add or what is the importance of what is being bought but seem to be always beating down the prices" etc. Positive and encouraging views could be something like "they are knowledgeable folks always helpful to collaborate for our needs while also making sure that firm gets value on what it spends; they have helped me specify what I need better; they have helped save significant costs when we needed the cash the most, etc.". And then, there could be mixed views like "sometimes they delight me but sometimes they perform in a very disappointing way for a critical project; why do they vary so much?"

Allow me to oversimplify such observations and metrics for a simple, intuitive analysis by rating combined experiences on a "4 point Purchasing Fitness Scale - Run seamlessly (1), Jog comfortably (2), Walk briskly (3) or Walk slowly (4)". If the predominant rating score is 4 (suggest taking the mode and not the average or median here), purchasing department's impression can be termed as equivalent to a BMI 35+ or sick or non-agile human being. On the other extreme, a rating score of 1 will give an image of a person able to run fast and for long distances effortlessly (like Usain Bolt or Belgian Stefan Engels who ran 365 marathons in one year). Imagining the other two rating scores and corresponding fitness conditions should be a mere formality now for the reader of this post.

So what are the mantras to enhance and maintain the fitness of Purchasing departments to be able to run processes equivalent to 1 marathon per day? A simple analogy from life again should help here, which I will describe now (a number of you would have experienced this too I am sure). A sedentary person decides to get active and takes the 1st step. He/she goes for a medical checkup, takes findings from doctor(s), physiotherapists and dieticians to evolve a scientific, practical, diet-fitness-relaxation regime. Firms can do something similar by engaging a specialized procurement consulting, BPO and technology partner firm (specialist doctors, physiotherapists and dietician all available in one hospital). The 2nd step the person takes is to seriously invest time, interest and resources to implement the regime - irrespective of whether he/she has to travel, go to the gym or work out at home, maintain perseverance and discipline whether it rains or partying becomes too much etc. Firms can do the same themselves or take the help again of a partner firm. Invest and implement into best practices based processes, technology solutions, people, information/intelligence etc. Outsource whatever makes you slow / loath and keep in-house whatever makes you faster and better instead. Set targets, measure constantly and report frequently.

So what happens next? Simple and intuitive again. Results start showing up. A person who was barely able to walk, is able to jog and run comfortably over a period of time as a result of following the 1st and 2nd step. Such transformations can be astonishing and are yet very real (I am sure that many of you would have experienced/seen such seminal folks around you). Once again, firms experience the same. The perception of Purchasing department changes along with its overall performance. It starts to be viewed as an agile, fit and ever-energetic department that is always rated 1, as it runs seamlessly to meet the firm's long and short term objectives adding tremendous value.

So get active! Take the 1st and 2nd steps to make your Purchasing department run seamlessly. Good luck to all the readers!

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