Ippc conference 2014

IPPC CONFERENCE 2014 Innovation and Public Procurement with link to Governance

Corporate Contracts Management Ltd

Introduction

• Procurement, whether in austere times or not should be looking at:

• - better governance

• - how procurement can add value

Procurement practitioners need to show clearly that we can make a difference in a difficult environment.

The opportunity is there to look at how procurement can be improved. Austere times calls for the ability to manage more with less.

Effective systems and procedures are the keys.

There is a link between how procurement operates and what can be done to transform procurement.


We need …

• Procurement transformation as well as value creation – this is a mix of how we do things and the value of finding and promoting procurement leaders and leadership.

• This is essential if we want procurement to move forward in any meaningful way and to show what is possible. We need procurement leaders and procurement leadership to create a way and means for change/growth to happen.

• Procurement reform – how far can we go? From now to creating a new level to the increase the value of procurement.

• Reform or Transformation? – Does it matter – as long as it happens?


Achieving the change.

• What is possible? How can we achieve a change?

• We might surprise ourselves – we might find procurement practitioners who want to make a difference – which is what is needed in these austere times.

• Question: do you want to make a difference?


What do we want procurement to look like?

• Procurement requires:

• (a) innovation

• (b) strong governance

• We can be proactive and look to working differently and more effectively.

• Procurement needs a ‘voice’ that does not currently exist. We need to speak up.

• There is lack of debate about procurement reform and for procurement leadership – we are doing our profession a disservice.


How can we promote leadership?

• We need to have the vision and to be able to communicate that vision.

• In the short term leadership might have to start with procurement practitioners – you!

• A start point is for procurement to provide personal leadership and then have confidence to provide leadership through your organisation – and to the wider world.

• Question: do you have the confidence to promote procurement?


Issues

• Some obvious issues are:

• (a) recognising the need – procurement needs direction, vision and procurement reform.

• (b) procurement practitioners need to promote procurement better.

• (c) remove the isolation.

• (d) we need to promote the agenda for positive procurement reform in order to find direction.

• Focus on points (a), (b) and (d).

• Question: why should we allow others to promote an agenda that we know does not assist procurement? How did that happen? The agenda is often one of ‘volunteering’ procurement to undertake actions that we know do not work. We need to communicate better so this does not happen. Ignorance from others can cause us headaches!.


Further issues

• Training.

• Debate – we need direction, discussion and input. Debates needs to be focused and be inclusive across business boundaries, e.g. include buyers and suppliers.

• Resources – the obvious are (a) skill base, (b) staff numbers, (c) financial resources.

• Consistency – especially in respect to training, key messages and high standards.


Benefits

• Benefits – of procurement champions are:

• (a) promoting procurement both internally and externally.

• (b)Acknowledging a ‘voice’ that is heard.

• (c) Being seen in its own right.

• (d) Having a management procurement champion at management level.

• (e) A ‘voice’ or seat on the Board/Management.

• Let us focus on these points


Why these changes?

• These changes can be achieved with little or no cost.

• Long term benefits can override any short term cost.

• The benefits can assist greatly in managing uncertainty.

• Achieving procurement governance in its own right is essential. This needs to link into organisational governance.

• Governance assists in effective systems and procedures.

• Let us focus on governance.


Procurement Reform

• Procurement is in need of reform.

• Urgent need to change/grow and gain a necessary ‘voice’.

• Set an Agenda and debate what can be.

• Having effective systems … and solutions – which assists in governance and essential in austere times.

• Innovation – we need to look at what is possible … rather than doing things the way we always have.


Procurement leaders and leadership

• How do we find such paragons of virtue?

• How do we empower them?

• How do we mentor aspiring procurement staff?

• We should not leave this matter in the ‘too hard’ basket.

• We need a strategy – and we need it now.

• We need to be innovative.

• Let us focus on this for a moment.


Naming leaders …

• A question: can you name 3 business leaders? Of course you can: They would be Donald Trump, Richard Branson, Steve Jobs are examples.

• A question: can you name 3 Procurement Leaders? Hmmm!. Why can we not do that as easily.

• Transformation can come about by:

• (a) looking at change, (b) making a difference, (c) looking at possibilities and (d) being able to communicate to management.

• We need a better procurement ‘voice’.

• Initiative is required especially in austere times. This can assist in ensuring governance as well as procurement transformation.


What makes a procurement leader?

• A procurement leader comes about by being:

• (a) passionate about procurement

• (b) having the ability to see the big picture.

• (c) being able to communicate, promote and ‘walk the walk’ and ‘talk the talk’.

• (d) provides value add to the day to day procurement process.

• (e) Can think and act strategically.


What is needed

• We need a mechanism to actively look for and then teach leadership skills to procurement practitioners who have the talent to progress.

• We require people with the ability to lead implementation teams working with procurement policies and procedures.

• Comment: Perhaps a Procurement Leadership Academy? Or, something similar.


Need for debate

• Debate is required to promote procurement change and to find procurement leaders.

• Procurement practitioners need to be involved in the debate – we should not leave for others whose knowledge of procurement is not as good as our own.

• Procurement should discuss amongst themselves what procurement needs so we can keep control of the topic.


Issues to consider:

• Place in organisation structure – it would be nice to be included in the organisational structure.

• It is time that we had a true ‘home’ rather than under Finance, Corporate Services or similar.

• Procurement Roles – Consistency of Roles. This is such a mess.

• Looking at Procurement rules – How to achieve balance of transparency versus time etc.

• Staff Training/Mentoring/Induction – mentoring is so important. We need to actively support staff.


Mentoring

• Should be available for those who wish to make use of it.

• We should encourage those who have the ability to mentor.

• Question: would you be prepared to mentor others?

• Induction – an effective induction programme would be useful. This should include governance as well as innovation.

• This can be achieved at any time and is more vital in bad times as well as the ability to transform procurement and to focus on innovation.


‘Soft skills’

• Procurement practitioners need not only the ‘mechanics’ of procurement but also the following:

• (a) communication skills

• (b) Leadership skills

• (c) Financial skills

• (d) Management skills.

• Be prepared to learn these skills which can lead you to providing leadership.

• This way procurement can emerge and grow.


Changing the Conversation

• We need to look at how we operate – we at times over complicate the process.

• We need to listen more to our suppliers. Why aren’t we doing this?

• As we need to achieve more with less and the need to consider governance issues – these two points need to be part of the discussion.

• Question: how well do you listen to your suppliers?


Delivering the results

• Do we? Do we consistently deliver results?

• Are we a part of the problem, rather than the solution.

• Is procurement known for saying ‘no’ instead of saying ‘yes’?

• Do we communicate our ‘wins’ through the organisation so it is clear that we can add value and innovation for our organisations?

• If not, why not.


Suppliers

1. We need suppliers to help us do our jobs.

2. Equally we should encourage our suppliers to be innovative.

3. We need suppliers to provide leadership as well.

4. We should not be afraid if suppliers ask for change, a new direction.

5. We can learn a lot from suppliers – if we only listened.

6. Buyers need to bring them along with us and recognise that both sides need each other.


Summary

• Innovation is more than financial – it is about adding to what procurement is about.

• Innovation and value creation can be about adding value to our own skills/roles.

• Procurement needs involved procurement practitioners –

• We need idea and for procurement to have a ‘voice’.

• Procurement requires leaders so we can have input into making procurement flow better and add realism to the conversation.

• Austerity is not the time for negativity – but it is the time for some big and different thinking – and action.


Summary

• Innovation is vital and useful in today’s environment and essential when operating in the public environment.

• Austere times calls for a change from business as usual. We cannot continue to operate the same way.

• There is a need for innovation and better governance.

• In times of austerity we must look at how we operate – being proactive is key as to how we can take a strategic look at procurement.

• Austerity provides opportunity which we can take into better times.

• Hoping for the best is not practical or ideal.


Two final questions

• Where are our procurement leaders?

• Where is the procurement leadership coming from?

• Question: how ready are you?

• Are you ready to take up the challenge – I leave that for you to ponder.


Any questions?

• Any questions.

• Thank you.


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Ippc conference 2014