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Why an Enlightened Procurement Department Is a Game Changer For Your Organization

Sharing information and a focus on synergistic outcomes will lead to better results for your company.
Enlightened procurement department.

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Imagine this scenario: You’re a custom home builder and a family comes in with specific requests. They want five bedrooms, three bathrooms and a walk-in closet. They want a breakfast nook and two-car garage and, if possible, the morning sun to stream into their young children’s upstairs bedroom.

For you, the builder, none of this is an issue. But you do need an answer to at least two vital questions: What is your budget? And, what is important to the individual stakeholders, in this case the family members? Imagine if the reply is: “We won’t tell you the budget.”

Sounds ridiculous, right? After all, a five-bedroom home can cost anywhere between $250,000 and $250 million.

But that scenario is what many buyers of commercial goods and services do all day long. They, the clients in this scenario, ask sellers, aka the vendor, to bid on products or services without any economic guidance. This scenario is bad enough in the commercial world. It gets even worse when you’re trying to sell into the government, where deviation from the traditional RFP process can mean a fine or even being banned from the bidding process.

Procurement, purchasing, whatever you want to call it, this is the department that has, for ages, been the nemesis of the sales professional. Procurement departments have a well-deserved reputation of being dysfunctional, of exerting control in a way that may work against an organization instead of for it. By limiting what information vendors can know, by not allowing them to talk directly to buyers, by shrouding the process in secrecy in order to avoid any suspicion of preferring one over the other, procurement departments broaden the gap between what will actually benefit their company and what those bidding can actually provide.

That’s the bad news. But the good news is that some procurement departments, what I regard as the enlightened minority, seem to have recognized this absurdity and have begun to change – a fact which has real consequences for sales professionals.

These procurement departments that are zigging where too many zag do so because of who’s in charge. Their process may look the same as others from the outside, but internally there are leaders driving a change in culture that benefits both them and their hopeful vendors.

These are people who understand how the perverse incentives of procurement end up hurting their own companies. They know that sellers who see an RFP overloaded with rules and regulations will put less effort into a sale. They know that sharing budget information, allowing managed access to business users and other key stakeholders, and having an overt focus on synergistic outcomes will regularly lead to better outcomes.

What does this mean for a sales professional? Mostly, it means you have to be willing to make the ask.

Even if an RFP looks impenetrable, you have to be willing to set expectations at the outset. You have to be willing to say that you’ll need guidance around budget, access to business users and key stakeholders, and certain proprietary data that you will keep confidential – just as you ask them to do the same with what you provide to them.

This openness can be incredibly beneficial, as I’ve learned firsthand recently. I’ve been on the receiving end of two winning RFPs in the past few months, and in both I used the same expectations setting strategy. In fact, in the case of the second company, I actually asked during the project kickoff how many competitors had asked for the same information we had.

The answer, it might not surprise you, came back “zero.”

In the worst examples, procurement remains a department hellbent on protecting its organization from the supposed evils of salespeople. But fortunately, more than at any other point in my career, these examples are in decline.

If they’re changing, that likely means you should be, too.

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