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One Size Does Not Fit All
Before process automation, process standardization was one of the primary drivers of efficiencies. For example, Henry Ford’s invention of the car made him a rich man, but it was his invention of the assembly line that ensured his great-grandchildren would stay rich. There is no question that standardization works within a business context and within a procurement context. Ardent Partners’ report CPO Rising 2012: Keeping Score highlighted the areas where procurement departments have process standardization and, perhaps just as importantly, where they lack it.
In most instances, standardization is the desired state: as the assembly line, proved, repetition builds proficiency for the individual and for the team. Chief Procurement Officers and other executives obviously prefer that their staffs follow a common set of best practices rather than waste time constantly reinventing the wheel. It make total sense – after all, one of the reasons why automation works is that the tools guide users through those standardized best practices.
Of course, I agree, standardization is great, at least for business processes. And, I think it is a safe bet that noone reading this article on Thanksgiving Eve would argue. But, there is a catch……. because the thing about standardization is that one size, in some cases, does not fit all. CPOs of large procurement departments (and particularly those in the early years of a transformation) certainly know this but must manage to the general or common situations, not the specific ones. The preference is to be mostly or generally right when being mostly right is a level step change above where you began (i.e. with processes that were erratic, inconsistent, incompetent, etc.).
But, being right about the “specifics” is preferable too and, it is important to note, something that is not mutually exclusive with being “generally” right. There are and can be valid exceptions to the standard way of doing things. Here are three examples based on recent conversations.
1. In my discussion with a Chief Procurement Officer (and recent client) about user adoption, our discussion quickly moved to her organization’s light use of eSourcing and generally less aggressive use of strategic sourcing. One issue cited was that the single, standard eSourcing process that was built into their project management solution was great for large, multi-stakeholder projects, but completely overbuilt for the small, single stakeholder project and all those in-between. In 2013, this group plans to overhaul its current, standard sourcing process in favor of something more nuanced because one size does not fit all.
2. I had a follow-up discussion with a Director of Sourcing at a company where I had recently referred in a few strategic sourcing consultancies (I was checking in to see how things were progressing). One of this leader’s comments to me was that the project leader of the consultancy they selected was quite adept at managing the eSourcing process but lost significant credibility and stakeholder interest by being pedantic. As a result, the number of projects being run was lower than expected. One size does not fit all.
3. Met up for lunch with a friend who owns a small consultancy…. My friend had negotiated the terms and pricing for a fairly standard contract with one of his clients, when he was told that corporate procurement needed to get involved. After what was literally months of back and forth with a procurement manager, an exception was finally granted…. this exception removed the required contract liability coverage for corporate automobile insurance (mandated for all consulting projects “without exception” per the corporate risk management group). The upcoming project requires no travel and the insurance policy would have cost my friend’s firm almost 30% of the total contract value. One size does not fit all.
Happy Thanksgiving! (to everyone in the US) – Everyone else, Have a great week!
See, even holiday greetings are not a one size fits all proposition.
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