Getting a consensus – the secret ingredient

One of the unacknowledged challenges in both buying and selling, in the discussions between sales teams and their counterparts in customer organisations, is the need to achieve consensus. This sounds obvious; clearly, the sales team and the customer organisation need to reach consensus across the two parties to be able to effect a sale or a purchase. However, the larger challenge is getting the internal consensus aligned in both organisations; for the sales team and their broader organisation to agree what is being sold, and for the customer team to get agreement internally on what they are buying.

The challenges of this are self evident when you are inside a sales cycle. Getting agreement on different things from different parts of the customer is an ongoing challenge. This isn’t helped by the observation that the customer side often holds disparate views on what is important or essential when looking at a product or service to be acquired.

The irony of the situation is that both sides are trying to reach the same position: where both sides have a clear understanding of what is needed and what is being offered, visible to all participants, and with any areas of concern or opportunity being worked on.

The danger is that both parties create an environment where part of the underlying requirements or offer are being obscured,  often because of a perceived weakness on either side which is then hidden until the contract is enacted.

As an example, the purchasing side often have a very limited idea about volumes which will actually be bought, and will provide a number which they hope is correct. The selling side need that number to understand the scale of the opportunity and the impact of the sell. If there is not a very clear discussion from both sides about the actual plans and impact, it is very hard for a warm consensus to be reached. At the point at which the limitations of the numbers provided becomes evident, it is often too late to change the effect of volume on other parts of the agreement, or how that plays out in the longer term relationship.

Clearly, both sides need to work out how to get to that consensus. From the purchasing / customer side, the various competing elements which have to be fulfilled need to be drawn from individual participants, shaped into a good quality output and cross business agreement reached on what they are. From the sales side, it is suggested that champions inside the customer are identified and helped (although the danger of this is that the ‘champions ‘ can be seen as taking on a  role selling for a particular supplier without broader consideration of other options available).

The radical step is for both sides to share their key issues and motivators in a clear way, and to work together to develop the best solution for all concerned. This approach of revealing issues which traditionally have remained hidden can feel deeply uncomfortable, and is counter intuitive for many.

However, embracing this approach, or certainly experimenting with it, can lead to better and more effective supplier customer relations and lead to efficiency and speed of delivery benefits otherwise unavailable.

We’d be happy to talk with you to explore how this approach might help you, on both the sales side and the purchasing side.

Contact susie@smartbrowndog.com to hear more.

DSC_0083

Posted in Uncategorized | Leave a comment

Shaping the Connections – Linking Procurement and Strategy

One of the challenges in business is to make sure that the actions of the various parts of the business align with business strategy. This seems like a really simple area of activity, but our observations over years of the challenges this poses deserve some reflection.

The first issue for many businesses is the quality of the business strategy. It is easy to find mission statements and corporate phrases which seem to have been taken from a business primer, and seem unrelated to the real or apparent mission or aims of a business. It’s also easy to find examples where the statements made have evident contradictions within them.

Let’s assume, for now, that we have access to a business strategy that is contradiction free and appears meaningful. Our next issue is whether or not there is alignment between that statement and the ability of the business to deliver that strategic intent.

An example is helpful here as an illustration. Take a business strategy statement which contains the sentiment ‘we will minimise our impact on the environment’ (see http://www.affinitysutton.com/about-us/our-social-purpose/environment-sustainability/ as an example *: ‘We believe part of being a business for social purpose is minimising our impact on the environment’.
This implies that there will be an evident link from this statement into working practices in the business. A procurement organisation will have to take this statement and see how ‘minimising’ can be translated into a set of activities, policies and procedures.

Equally, there needs to be a balance of this strategic statement against other strategic statements, such as optimising profit for re-investment, health and safety and any other priorities for the organisation.

So, how can a procurement organisation read this as a statement, and what should it expect? In the balance of any purchasing decision, there must be the ability to look at options for different purchase approaches, and how the balance between those approaches work. The building trade generates a notable amount of waste, so some purchasing decisions could be influenced by a waste minimisation approach, which may be less cost efficient, but achieves the ‘minimising statement’. Potentially, focussing in this area can identify additional approaches which will help minimise waste anyway. The challenge is to have the business case for the chosen approach expressed in such a way that the balance of the different needs and strategies can be seen and evaluated.

However, it may be that the environmental strategy has less weight than one of the other strategies; promoting it above other imperatives will cause a conflict unless there is a really good additional reason for doing so.

Here lies the core part of this challenge: making sure that we understand the business strategies sufficiently well that we can deliver progress in a balance of areas, in a way that our business leaders find compelling.

A range of techniques is available to do that; variations on balanced scorecards, weighted grading systems and others have all ben developed and used to good effect. We’ve used a range of them in the past to make sure that strategic alignment is well considered and used to drive business decisions.

However, none of this will work if the business strategies have been put in place without thought about how they can be operationalised. At this stage, we may have to go back to the business leaders and test and challenge the assumptions which sat behind the original statements. If nothing else, it will be the start of a valuable conversation.
* Note: I’m using this as an example; I have no knowledge of how this particular business actually operates; it came up first on a search for ‘business strategy of minimising impact on environment’. As a social enterprise and a NFP organisation, it has a strong link to some of the ethical issues suggested above.

IMG_2071

Posted in Uncategorized | Leave a comment

The Carbon Neutral Office: Apple, Google and Smart Brown Dog

There’s been a burst of press coverage recently about the achievements of Google and Apple and the way in which they have  moved towards carbon neutrality for their major facilities, through a variety of techniques including, in Apple’s case, rafts of solar panels installed in all facilities.

This sounds like the sort of big corporate greening activity which generates headlines, but it doesn’t have to be just huge businesses which tackle such things.

Smart Brown Dog manages to operate from a carbon neutral facility as well, through a mix of informed purchasing, solar installations and old fashioned heating. We’ve done this partly out of a conviction that it’s the right thing to do, from a desire to participate in the post-carbon economy but also as a consequence of location.

We have the privilege of operating from a rural location; we don’t have a gas supply, we don’t have oil tanks, but we do have an uprated electrical supply which, although occasionally unreliable, is effective. We also have a good supply of wood  grown and harvested locally and a large solar array installed in 2016.

Our set up is a mix of burning sustainably grown wood from local sources (as in, we can pretty much see the fields and woods they come from) for space heating and hot water. We have solar providing hot water, even making a contribution in the grey British winter. And we have electricity.

Our power provider sources all their electricity from wind and solar generation which means, in effect, we’re operating in a carbon neutral system. We’ve been doing this for years, and rejoice in being customer number 7!  With the current fluctuations in oil price, it is hard to judge if we are cheaper or more expensive than running on oil or gas, but our general feeling (particularly with the addition of solar) is that we’re doing OK, particularly if oil spikes again.

We’re not complacent. Consumption could be managed differently, and our mix of space usage leads to inefficiencies here and there. However, it’s a good first step in the direction of sustainability.

It’s not an instant thing, and takes some planning and forethought to get right. But I hope we’ve shown that it is possible, and is something many businesses could aspire to.

Find out more about us at http://www.smartbrowndog.com

DSC_0326

Posted in Sustainability | 1 Comment

The EU, Procurement and the quality of the debate

The quality of the debate – Staying in the EU and Procurement

 

In Procurement circles, there’s a real challenge in making sure at there is high quality analysis of particular categories, culminating in the clear expression of the way forward for that set of purchases. Markets are analysed, numbers and effects sought and clarified and a careful weighing up of the issues, against the known business requirements, allows a clear headed selection of an approach.

 

Contrast this with the current standard of the discussion on Britains position within the European Union. The standard of debate and discussion so far is wilfully low. The stay argument is defaulting to what is likely to go wrong if we leave, without any exploration of the benefits of staying. The leave campaign is getting as far as ‘it’s just better out’. 

 

We deserve significantly better.

 

A great starting point is to clarify our needs as a country, in the main areas of government activity and economic growth, then get to a debate about how in our out fulfills this.

 

 

The current level of playground argument is demeaning.

 

Mark Hubbard thinks about Procurement at http://www.smartbrowndog.com

Posted in Uncategorized | Leave a comment

Saving the NHS

The NHS is a centrepiece of the U.K. It is a unique, open access healthcare system, roughly free at the point of use. It is also the fifth largest employer in the world (after the us and Chinese military, Indias railway and either India post or China post, depending on years), and consumes more of the U.K. GDP than defence and education together. And it’s in trouble.

 

More is being spent than is in the budget, and demand continues to increase. To add to that, the services which are being provided are becoming more complex and more expensive, adding to the woe. This seems bleak.

 

However, there is a way forward that has been explored, tried in part and seemingly struggles to gain traction: spending less on goods and services through sound commercial approaches. Those of us who have looked at the way the NHS buys stuff all have an absolutely common and shared belief; that there is an amount of money available to be saved which is greater than the size of the financial hole  being described.

 

This isn’t about poverty wages, slashing services or reducing hours.This is about paying the right amount for the right goods and services, and making sure that value is extracted. Examples abound. Even simple things are bought in a way that suggests that there is an infinite budget available, with no comprehension about the impact of adding complexity and cost to the whole process.

 

Many have tried and failed to impact this. The mind numbing complexity and governance of the NHS with its hundreds of independent units makes for a significant challenge, which needs a truly firm hand and vision to manage. The stakeholder groups are broad and deeply influential; the medical consultants hold huge sway, able to derail even sensible suggestions, with no accountability for he financial impact of their influence. Politics, both local and national, slow decision making down to less than a crawl.

 

In truth, a funding crisis may be exactly the critical event that the patient needs to avoid death, to provide a behavioural jolt to the collective mind of the organisation.

 

This has been addressed on a regular basis in other organisations, both commercial and public sector. Approaches are well developed, understood and available, and have been shown to work in a wide range of complex organisations. This isn’t the issue. 

 

Price and cost challenges which have been developed all shown great opportunity for saving, so there’s a commercial opportunity which is available. This isn’t the issue.

 

The shared need is clear. Getting costs down is known, although there may be political reasons for hoping that the issue will go away. However, it is clear, and unlikely to go away immediately.

 

The gap appears to be an absolute sense of leadership for the change in approach necessary to deliver saving; both in terms of showing an expected direction, but also in spelling out expected behaviours. This is made harder because of the wide devolution of power across the organisation as a whole, but also because of the absolute focus of much of the organisation on clinical delivery ( correctly so).

 

Our big question as taxpayers should focus on the lack of leadership in the NHS to address the continued waste of resources through poor commercial practice. If we could get to that, the opportunity available will close the undoing gap rapidly.

 

Mark Hubbard thinks about Sales and Procurement at http://www.smartbrowndog.com

 

 

 

 

 

 

Posted in Uncategorized | Leave a comment

The Calais refugee crisis and its supply chain

There’s a big refugee camp at Calais housing a large number of people in difficult conditions. Unsurprisingly, this is generating an amount of interest in how the people there can be helped, politics and discussions about economic migrants aside.

There is a consequence of this, which shows the need for a very clear understanding of requirements and supply chains before making any decisions, which read directly into the challenges of building the needs of a commercial supply chain.

In essence, a number of issues exist, principally in the identification of needs, and addressing the way in which those needs can be satisfied. Those on site are faced with the impact of what happens when the wrong needs are identified and ongoing consequences of that.

At present, those trying to manage the supply chain on site are faced with the well meaning delivery of the wrong stuff. Boxes of childrens clothes, ladies summer dresses, even stiletto heeled shoes have been delivered to a camp of almost exclusively men aged between 20 and 50. The consequence of unplanned drops from well wishers is a scene of rapidly reviewed and discarded gifts, not because the recipients are ungrateful, but because the gifts are ill considered. The net result is a sequence of poor TV images, apparent ingratitude, and mounting costs for storage for unneeded items.

At present, workers on the site believe the primary needs are winter clothing for men, appropriate tents as shelter, and managed food supplies. As a preference, there needs to be appropriate marking to show what is actually in the boxes arriving so distribution and storage can be effectively managed.

Using a Procurement analogy here, the largest challenge is the gap between the donors of aid and the site organisers and recipients. It is really difficult to ascertain what is needed because the needs are confused, unclear, and often appear to be owned by other parties. For this camp, there are even reported cases where individuals have represented themselves as being aid workers and able to channel goods and funds, only to be found later to have misrepresented that position.

So, as a concerned doner, what should anyone do?

The key seems to be to identify  true owners of the support activity going on and making sure that our own efforts align to those A great link to do this is here: http://www.calaidipedia.co.uk/ which provides regular updates on the situation and needs.

Susie Hudson, Smart Brown Dog’s marketing specialist, writes of her own experiences of organising a food donation here:

https://www.linkedin.com/pulse/my-lesson-donating-jungle-calais-read-share-susie-hudson-mba-fcmi?trk=prof-post

Mark Hubbard thinks about sales and purchasing at www.smartbrowndog.com

calais

Posted in Uncategorized | Leave a comment

Selling to Big Pharma and Big Food

Big Pharma (all the largest pharmaceutical companies in the world) and Big Food (all the big brand companies we know and love) have all adopted, in one form or another, an approach to purchasing called category management. This isn’t new but it is very well embedded and it has some serious implications for the way in which sales teams need to approach these businesses.

 

Category Management asks the customer to work across their organisation as a team to clarify their needs and wants at a good level of detail, to identify the most appropriate way forward to acquire the products or services and to seek the broad delivery of value from the imply chain and the use of those products and services. Of course, there’s more, but the fundamentals are pretty much the same. Some categories may value areas like risk avoidance and low price more than innovation and development, or have an entirely different mix of needs and wants.

 

Of course, their needs and wants will be influenced by their business strategy; growth and expansion drives a different set of behaviours and needs than contraction and withdrawal. Equally, their approach will be influenced by their current position and historical activity, and the current internal stakeholders engaged in the conversation.

 

Further, the approach defined will be dependent on the way in which the customer perceives the marketplace to be working. Understanding of the boundaries and dynamics in a marketplace will be built into any approach which is developed for future purchases.

 

As such, an organisation which has to sell to a business which has a developed category strategy will require a different approach than selling to a business which does not have such a strategy. The best way to sell is to address the content of that strategy and demonstrate how the products or services offered best meet the category strategy.

 

The big question is whether a sales team can either access or imagine the category strategy. Asking for a synopsis would be a good start, but if it’s not available, it may be possible to develop a good approximation of that category strategy – after all, it was put together by a similar group of bright motivated people who were following a well described process.

 

To do this, the sales teams needs a similarly constructed process, which allows key insights to be developed about the customers strategy, and identifies the way in which the sale needs to be positioned to maximise the chances of success.

 

This may sound impossible, but much of the required information will already be available, just not assembled in a way that allows a possible customer strategy to be identified. As such, getting a degree of guidance on how this might work is a sensible step. Remember that your own procurement team may have insight and understanding in how this works and could be developed.

 

Working in this manner, a number of sales teams have dramatically increased their success rates in replying to customer needs, by having a very clear focus. Without this, the reply to a customer will be based on something other than their strategy, and therefore has far less chance of success.

 

Mark Hubbard thinks about sales and procurement at http://www.smartbrowndog.com

 

 

 

 

Posted in Uncategorized | Leave a comment