Traditionally, technology procurement has been all about logistics—logistics and cost management. But as more companies embark on their digital transformation, technology is being seen more and more as an investment; rather than simply tools that help get the job done, your technology infrastructure can now give you a competitive edge, powering innovations that make an impact on your operations, product and service delivery, customer relationships and more.
This is why even before the pandemic, procurement was beginning to trend more towards a strategic center of the business; the supply chain’s constant surprises helped accelerate this trend. Now, procurement organizations that can progress and mature can play a critical part in helping their businesses stay resilient, competitive, and open to game-changing innovations—along with operational and cost improvements.
No matter if you’re in the early stages of this progression or further along, the key is to embrace a people-first mindset—from your internal customers to external.
Change is most successful when you embrace the people impacted by it
It’s human nature; people can be surprisingly resistant to change, even when it’s overwhelmingly beneficial for them. Whether it’s changing devices or processes, when you modernize and mature your technology procurement, you’re making changes. Which is why the most successful procurement teams embrace a change management strategy.
Change management is defined as “a structured process for planning and implementing new ways of operating within an organization.” Put another way, it simply means being deliberate, strategic, and inclusive when you plan to make a change.
One principle of change management is the concept of the “select few” vs the “diverse many.” At many businesses, it is a few leaders at the very top of the organization who are making the decisions. But the decisions they make—and the resulting change—impact everyone at the company, i.e. the diverse many.
These are the people who must adjust what they’re doing, and if you’re not involving them, you’re missing out on their valuable insights—as well as an opportunity to bring them in at the early stages so they’re more likely to welcome change when it moves forward. It’s the first step to helping them move from a mindset of “have to,” where they’re begrudgingly going along with something because it’s a directive, to “want to,” where they’re excited for the change and help to champion it.
Internal customer interviews can help you uncover invaluable data sets
No matter how long you’ve been working with them, it’s always possible to get to know your internal customer better and understand exactly what their needs, wants, and pain points are and how you can serve them through procurement—which will guide you in your journey towards proactive, strategic management. As part of modernizing and maturing, you’ll then want to interview these internal customers with a few goals in mind.
As McKinsey suggests, you’ll want to have “three core objectives in conversation with your end users: understand how people at your company perceive your procurement organization, identify their expectations and opportunities for procurement to add more value in the relationships, and start building toward more effective collaboration.”
You can also use these conversations to build out user personas: profiles for each type of internal customer you need to provide technology for, including details such as their job title, main functions and characteristics of their job, where they do their job—key in our modern, hybrid workplace—and what their goals, objectives and pains are. You can then map the technology tools they need to each persona and create pre-built bundles, so that whenever there’s a new hire in one of these positions, ordering their technology is as simple as a couple of clicks through an online procurement storefront.
These personas are also important data sets that can help you go proactive: these insights can help you better forecast your procurement needs, so that you can establish inventory reserves—aligned with company-wide budgeting and planning—and be ready to set up new hires immediately.
Not to mention, by involving people company-wide early on through these conversations and by considering their viewpoint and input, you’re actively engaging in change management that will help ensure they’re more likely to embrace whatever procurement-related changes are coming their way.
Of course, you can’t interview every single person in your organization, but you can select a few representatives from each department and level who can help provide insight. These people can also form a coalition of early adopters that will be a lighthouse for people across the company. This is part of what’s known as John Kotter’s 8 Steps to Change Management; Kotter is a Harvard Business School professor, founder of management consulting firm Kotter International, and one of the business world’s most prominent thought leaders in change management.
Other applicable steps include:
Form a strategic vision and initiatives: If you can draw a picture of where you want to head as you modernize procurement, you can help everyone visualize what the new processes and experience will look like and better prepare for the change.
Enable action by removing barriers: As you engage your internal customers, take the time to understand where they face challenges and see if there are ways procurement can help break does down to clear the way for progress.
Generate short-term wins: Consider your path to procurement modernization and maturation as a journey, taken in steps and stages. But, to keep momentum and motivation, it helps to identify early quick wins, celebrate them, and continue this as you go to keep the procurement team and company alike energized about the initiative and aware of your progress.
Consider the needs before the tools
It’s easy to get caught up in a shiny new thing; we’ve all been there. But smart procurement managers know the difference between a tool that serves the people in your business and trendy tech that is great but isn’t the right fit for your organization. You can not only use your internal customer research to determine the technology they need for their job, but also the technology needed to procure and deliver it.
There are a lot of really incredible, game-changing modern procurement tools out there. One that’s nearly universal is an ecommerce-like procurement store that’s been customized to your business’s unique needs and requirements. A cloud-based procurement storefront is more secure, can provide real-time views into warehouse stock levels, so inventory is always up-to-date, and it can also automate order updates for more seamless management.
These storefronts can also be set up to be more internal customer-facing, or B2C if you will. Your team can populate them with bundles that meet your requirements, that employees can then purchase and have delivered directly to them, just like Amazon or another similar online consumer store.
In this way, by creating a people-first process, you’re not only creating a better, faster experience for them, but you’re also reducing downtime as well as labor for the procurement team.
There are also a variety of technology-powered delivery options that achieve the same results. If you have a robust office or physical locations, there are now technology vending machines where employees can pick up pre-configured devices with no downtime. You can even explore drones for curbside delivery.
Modernizing procurement begins and ends with people
Whether you’re new to your procurement role and the company or not, change always begins with a thorough and clear-eyed assessment of where you are. Then, you can focus on incrementally maturing and leveling up as you transition from responding to cost pressures and logistics to focusing more on identifying and creating additional value. For example, you may want to start by winnowing out additional margin improvement, improving your internal customers’ access to resources, or reducing your overall risk.
No matter where you start though, by interviewing your internal customers closely and thoughtfully incorporating their insights, you can gain a better view into where exactly you should begin, what tools would prove helpful, and how to get there—as well as bring them into the process so they’re more likely to engage with any forthcoming changes.
As we’ve discussed, these conversations don’t only help you understand and better plan what tech to order, but can also help you reduce risk, downtime, labor, improve efficiencies, and start forecasting effectively. They are the starting point in a series of steps you need to address to start moving your technology procurement—and your organization—from reactive to proactive and strategic value center. Our latest guide walks you you through the rest, so you’re amply prepared with the knowledge you need to hit the ground running.