To what extend would you agree with the following statement: the shorter the average time to procure, the happier the stakeholders?
By average time to procure I mean the length between the first time your stakeholder gets in touch and the day he gets the service/good delivered
I have found that time to market is extremely important to stakeholders. In fact, I find it to the be the number one issue amongst stakeholders to the point that at times they put Procurement in positions of little or no leverage. The dark side of speed is of course potential issues with quality or not getting the possible deal in terms of overall value. That being said, if that is what the stakeholder values and they can live with the risk, it’s important that we as Procurement professionals do what we can to meet their needs.
Like the old saying goes: good, fast or cheap…pick two. The magic of what we do is in those situations where we can do all three.
In my experience this is stakeholders overwhelming gripe with the Procurement process, and in my view should be one of the KPI's and processes that Procurement work hard to improve. One of the reasons this happens is because we are involved too late in the process, and although this is somewhat down to our stakeholders it can also be in Procurement's power to improve this by examining the root causes of bottlenecks and improving these. By proactively going to stakeholders on a regular basis (once a month maximum, ideally more frequently - can be a simple weekly phone call and chat) we can draw out early requirements and create a forward plan of what might be coming down the pipeline. Every step of the Procurement process can be streamlined to make the end to end process quicker; it just takes focus and commitment by the Procurement team, stakeholders and the organisation leadership together to achieve this.
Your statement has some merit and most stakeholders want speed and cheap. However, the feedback that I get from my stakeholders is all about meeting commencement time frames, minimising variations, value for money, quality of the work/goods/services and the selection process at evaluation. Also, if you are being 'put in positions of little or no leverage' procurement needs to embrace using the word 'No' .
Welcome to 2016.
Wow so many considerations in these responses. All I will say is that the shorter the process the happier I am too :)
What is fastest? Direct award or sole source. What does public procurement policy favour? Open competition. That’s where my job gets challenging as a custodian of public procurement. I find government BUs faced with the choice of observing the rules and meeting a significant operational deadline, often choose to bend the rules or cross the line. “Getting the job done” is their claim as sufficient justification for the decision. They have political pressure to deliver. A manager with dollars in budget but without authority to hire staff, does not have a realistic choice between hiring and contracting out. I see too many direct awards, and too many pseudo-employee contractors.
In my view, This goes under 2 points:
1- Is it the right procure at that time?, (The best decision as a responsible for procurement, including all technical variables)
2- Are the Stakeholders happiness will eventually come from income or Profitable Growth? .....Yes
In my opinion, It doesn't matter how shorter the time is, Because if we rational the process, the chance of having a slightly negative impact will be exist.
However, I agree that TIME in making decisions is Important including other key factors other than Procurement (for example; Marketing Decision),,, But In Term of Procurement Prospective it's not the priority as much as the total output is matters. Unless it optimistically will help the profitable Growth of the business.
Having said this, 90% I wouldn't Agree that Statement is True, 10% Must depends on judgement of the stakeholder...THEY IN CHARGE, or you will get fired!!!
ETA ...ETA...ETA...if I could get a dime every time I heard that. I'd be a millionaire by now, I suppose. Quick delivery is a dream come true. It's not impossible either, but as James has mentioned above, procurement has to be part of the pre sales game. When I say "part", it's not necessarily a decision making role, but more of facilitation.
An opportunity to assess the need before it is inked, so that a prep can be put into action.The key lies in anticipatory preparation and no one does it better than procurement .
I feel a huge gamut of organizations across the world haven't really earmarked the role strategic procurement can play in getting their requirements manageable. I hope this changes with time.
I agree, shorter the procurement time , the happier the stake holders. One of the key to this is that the stake holders should keep procurement team update on their business plans in advance so that Procurement team can do the pre work and be ready to deliver the requirement at short notice. We have used this effectively and have been highly successful. We do a monthly / quarterly connect with the stakeholders and get their inputs on proposed / planed procurement that they foresee. Many a times all requirements don't translate into procurement requests but for those that translate the procurement process is really fast.
Increasing the cycle time via implementing systems helps increase procurement capacity and effectiveness. However, not being able to plan properly is a key issue across a number of categories as activity is driven by other entities within an organisation - ICT and Construction are two category examples where procurement may have no insight into what the drivers are. 'Specifications' get thrown over the wall to procurement so is reactive – need to move to proactive. Also where contracts are hidden in a BU and are ending so everything then becomes a rush as there is limited time to plan. To avoid this procurement needs to do two things – firstly, tap into the ‘planning cycles’ of the BUs and understand what drives activity and obviously what is coming down the pipe to procurement. Secondly, there is a need to understand ALL of your organisations contractual obligations - when contracts are ending so they can be renewed or extended. Contracts should be in a single repository.