In a performance review meeting with an internal customer, the issue was raised as to why tenders were late, the bidders’ list was not robust enough and company estimates were far too low compared to the lowest quotes. All fingers pointed at Procurement department being the cause. Other departmental heads present accused them of working in silo and not interacting enough with them. I am also aware of a survey carried out in another company on the service delivery of the Procurement department. The respondents were the User departments (internal stakeholders). All respondents scored procurement poor in service delivery. So the question is why do the user departments always see procurement department as poor in delivering services to them? Is it strictly a matter of poor performance or poor relationships between Procurement department and its internal stakeholders? Various strategies have been developed in procurement geared towards improving service delivery to our stakeholders.
Stakeholders of Procurement department are the people or departments who stand to benefit or lose from Procurement department’s direct actions. CIPS has identified three types of stakeholders namely: Internal Stakeholders, External stakeholders and Concerned stakeholders. We shall focus on the internal stakeholders in this paper.
Internal stakeholders of Procurement department represent the internal customers who are serviced by the Procurement department for actioning their requisitions, responding to enquiries, and approving the transactions. The internal stakeholders have different interests and contributions to the business. For example, the interests of the directors are organization’s profitability, survival, and growth while their contribution is in formal authority over planning. On the hand, the interests of the Production department are accurate fulfillment of specifications, timely, relevant expert advice on price and availability issues while the contribution of the Production department to the Procurement process will be to provide detailed specifications which the buyer will have to process into a purchase order. Some of the internal stakeholders are Production, Corporate Affairs, HR, Engineering, IT, Marketing, Finance, Legal, Internal Control, Tender Board etc. They are main customers of the procurement department. They are often demanding and their requests many times all carry the same level of urgency. Therefore, Procurement department is usually pummeled left, right and center and often blamed for delays. Let us at this juncture discuss how procurement departments can effectively manage their respective internal stakeholders to achieve the organization’s goals.
The Procurement department staff should consider themselves a Guide and Adviser to the internal stakeholders. They ought to relate with the stakeholders like the person who accompanies and looks after another or group of people in matters of procurement. Be like their tour guide in procurement matters with the intention to look after them and help them achieve their own goals. They must teach them the procurement processes and guide them on how to apply them correctly. As the expert and a chaperone for your stakeholders, you oversee them, guide them, and direct them where they need to go. This can be challenging but achievable. In more specific terms, I wish to suggest the following ways of dealing with internal stakeholders:
Develop interpersonal relationship with your Internal Stakeholders:
A good relationship often works to forget about faults and focus on what is achievable. This is as true with personal relationships as with business relationships. As a Procurement Officer, make yourself accessible to these teams, and build relationships to understand their business needs and drivers and try to get ahead of their requests and learn to anticipate their needs. When you do so, the customers will consider you a partner in progress and therefore, easily co-operate with you in the procurement process.
Establish Clear Roles and responsibilities:
This has to do with segmenting the procurement department functionally and creating teams which will focus on serving respective customers. It is important that the customers are aware of the officers and teams assigned to serve them. It will do the relationship a world of good if roles are clearly established and the status occupants are clearly communicated to the stakeholders. The roles and responsibilities of both Procurement Officer and the Internal Customer should also be well defined to avoid ambiguity or duplication of roles. This could be done by developing a RACI chart showing who is: Responsible for the task, Accountable, to be consulted and Informed of the task.
Make the Procurement Process very Clear:
Nothing hurts a relationship like ambiguities of ‘dos’ and ‘don’ts’. It is very necessary to clarify all procurement processes with the stakeholders. They need to know what is acceptable and what is not. For instance, if your approved processes have no room for ‘emergency procurement’, everybody needs to be in the know. This will immediately guide the stakeholders never to entertain such a suggestion whenever it is made. Procurement departments should therefore regularly engage their stakeholders on the processes and update them when there are changes.
Develop A system to Prioritize requests
It is true that many times, the resources available to Procurement department are insufficient to handle the myriad of requests that come at the same time. Therefore, it is essential for some prioritization. When requests come, the Team Leads and Managers must prioritize using their helicopter knowledge of the goals of the organization. They must be able to identify urgent requests, not too urgent requests and routine requests. The danger in saying that ‘I can’t action your request now because I have a lot to do’ is that Procurement staff may become relaxed, considered as not supporting operations and the internal customers may become suspicious that they are not attended to like their other counterparts. This could create distrust. One of the ways to eliminate this problem is to develop a Service Level Agreement, SLA between the Procurement department and its internal stakeholders. The SLA will recognize the pressure of requests and generate number of days within which requests are expected to be executed as well as a mechanism for escalating delays. It is agreed between Procurement department and their customers. Another way to eliminate the problem is to develop your annual contracting plan with the User departments very early in the year and monitor its application judiciously.
Despite the above measures, you must recognize that some internal customers can be difficult no matter how hard you try to satisfy them. Therefore, you may apply the following strategies for dealing with such customers: Identify them and watch them closely to find out what motivates them in order to go the extra mile in satisfying them; Empathetically Listen to what they say and do not close communication channels because you don’t like what you hear; Meet them one on one because without other stakeholders in the room it makes the atmosphere more comfortable leading to clearer and calmer conversations; Determine the causes of their resistance and show them that you are committed to deal with those issues.
In conclusion, it is important to always realize that the internal stakeholders are critical to the existence of the Procurement department. Though they have the tendency not to appreciate our efforts, we must necessarily find ways of managing them to achieve our procurement goals and the goals of the organisation at large.
Gob-Agundu Uche
MILT, FCIPS, Chartered
