Procurement: Friend or Foe?

Procurement… David Ford Chief Executive Agree/Disagree? Friend or foe? Let David know: david.ford@brightblueday.co.uk In a previous life, I remember Today, in many cases, it is the Procurement team who turn up in Porsches, working for some of the richest organisations on the planet. Procurement teams, in my experience, have wised up and now understand marketing communications (including the new world of swapping cars to meet up with With an increasingly commoditised product and having been ravaged digital) often better than some clients or even agencies. They have by the recession, it is agencies who are struggling to make acceptable taken the time to understand how an agency works and how it makes the Client Procurement team… margins. money. The smarter Procurement team will want to ensure that an It was not the done thing to turn The old game of cat and mouse is over. Today’s modern world requires agency can make a good financial return, as they know how this is critical to the long term success of the relationship and the agency. up in a Porsche to plead poverty a modern and positive approach to running an agency, negotiating fees What they won’t do is leave the chequebook open or the meter running and working with professional purchasing teams to agree a mutually or indeed accept the cost of the agency’s inefficiency…It is their duty and emphasise the agency’s frugal beneficial financial model. to drive accountability and return on investment. approach to doing business. So what is my advice to working with Procurement and what is my advice for them? Understand what their role is, what their objectives are and how much power in the organisation they have. Above all, build a relationship with them. Some of my best client relationships are with the chaps from Procurement and I have found that they have been enormously helpful, way beyond the contractual stage of the job. To find out more please call 01202 669090 or visit brightblueday.co.uk

They understand the organisation and they often have a much better Recognise that to motivate an agency you need to give them the understanding of the bigger picture and can be a very helpful ally if you occasional pat on the back. Like all humans, we respond to nurture are having challenges with your everyday client. and positive encouragement and we need to eat, so be prepared to pay a sustainable rate and to recognise some of the real costs Once you understand their objective, help to work with them to achieve it. of doing business. Within negotiation (and you will need to negotiate), understand where you can give and where you can’t and set yourself clear guides of what the And finally, remember that agencies can add an enormous value agency can afford. When you reach these limits, be honest and say so. to the client’s business. They build up enormous knowledge and understanding. They often have great insight and normally will While what we sell can be quantified in some have a team of people involved – often the agency will have far better knowledge and understanding than the client who may not measures, it is an art and not a science. have been there as long. So, before calling a competitive pitch, understand the issues driving that thought from both the client It is a creative industry and if you have demonstrated and the agency side and look at alternative options to address the insight, understanding and a passion for a client’s situation. Discussing performance on both sides can often shed business, then you can have confidence in your product interesting light on problems and it can address issues and provide and offering and in the value you attribute to that. simple solutions, with dramatic improvements. Finally, know your value…Benchmark your hourly rates to ensure that what you think you are worth is what A pitch process is costly, time consuming and the market thinks! And benchmark yourself on very expensive for clients and agencies and only projects to confirm your efficiency. sometimes results in a positive improvement. For Procurement specialists, I think the challenge is So, heard it before, or wise words? The client–agency relationship often to get agencies to see the client’s viewpoint, will always be a key success factor in most client and agency specifically the bigger picture. Often we are very businesses – Procurement is a central part of that relationship. focussed on us and our own needs and objectives. So embrace it, nurture it and value it. To find out more please call 01202 669090 or visit brightblueday.co.uk

Procurement: Friend or Foe?

by Bright Blue Day on Sep 23, 2010

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Procurement: Friend or Foe? — Presentation Transcript