[Editor’s Note: Today’s article is a guest publication from Jennifer Kaelin, CFO of SciQuest. Ardent Partners is happy to review and feature guest publications from authors across the procurement and supply management industry. If you or someone you know would like to become a guest contributor, please contact us at editor at cporising dot com. Thanks!]
Easing the Procurement Transformation with Company-wide Buy-In
Squeezed margins are often one of the reasons why companies start to transform the procurement process. Better control over spending, fully understanding what products and services are being used, or more accurate vendor reports for negotiation are a few other reasons. In the end, regardless of why the transformation was started, the goal is to improve the company in some capacity.
Recently, some companies have been automating the procurement process and seeing significant results that help the company’s bottom line. However, many other organizations are just beginning to embark on the journey. Although the processes the procurement team will put in place will ultimately help the company in numerous ways, a company may find itself dealing with an uphill battle to obtain buy-in from the rest of the organization. But it doesn’t have to be that way.
Instead, companies can actually have a relatively easy and beneficial transition process. But it will take planning and coordination:
- Analyze your current processes rigorously – When transitioning from manual procurement to automated processes, the old adage that junk in equals junk out is very true. If a company has an inefficient and ineffective process and then simply automates the same steps, it will remain inefficient and ineffective. Instead, companies must take the time to understand where bottlenecks are occurring and why, and then determine how it can be stopped. Additionally, look for extra work or steps in the process that don’t add value and should be eliminated – only once this is done should automation be added. This will also help the rest of the company buy into the process; employees will see that procurement is trying to streamline processes to make things faster and more efficient to help the company.
- Understand and prioritize company needs – Each company has different needs, priorities and pain points. At the same time, no company can completely change an end-to-end process at one time. Instead, companies need to take baby steps. Oftentimes, companies try to automate the most complex process first so that they can overcome that hurdle first. However, we strongly recommend automating the easiest processes so that you can build on these successes.
- Identify coworkers who don’t work in procurement to be champions of the process – During the automation process include coworkers from a variety of departments in the transition process, including asking those individuals what is or is not working and asking their opinions on elements that will impact other departments. By including people from outside departments, employees will feel like the procurement team is including the rest of the company, trying to make the process better and not just dictating what will be done. Additionally, these people can act as champions of the new process. While the transition may not be easy at all times, the people that know the inner workings of the decisions can explain to others that the decisions were made for a reason and that this is for the best for the rest of the company.
- Gain senior leadership buy in – Senior leadership carries a significant amount of weight with the rest of the employee base. Making sure that the leadership team knows why the process is changing and what the benefits are for the company, and making sure they believe in the effort, will help them address questions or concerns from others in the company. Additionally, leadership can inject excitement about the change into the company by showing their support for the project.
- Keep the rest of the company up to date on the project and the goals – While champions and senior leadership buy-in will help, keeping the rest of the team up to date on why this transformation is happening will also foster buy-in. You are about to start changing processes that impact their everyday lives (even if they don’t know it yet). So letting people know why, how, and what the end game is will help them feel like they have the inside scoop and know what the pain is for.
While this process is not going to be easy or quick, it does not have to be painful for the entire company. With some careful planning and sensitivity, the company can sail through the process and have people know why the process is critical.
About the Author
As CFO at SciQuest, Jennifer Kaelin is responsible for financial strategy, fiscal management, investor relations, and decision support related to investments and funding. She brings over 20 years of financial leadership experience and is committed to maximizing long-term shareholder value, supporting growth, and driving operational efficiencies. Jennifer is a Certified Public Accountant and she earned a Master’s Degree in Accounting and a Bachelor of Science in Business Administration from the University of North Carolina at Chapel Hill.
Procurement transformation will be a big topic at Ardent Partners’ inaugural CPO Rising executive symposium next year. Join us in Boston on March 29-30 for what is shaping up to be the procurement event of the year. Register here!
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