I’ve been at Difrent for just over two months now, and I suppose as I’m still in that honeymoon phase where everything is still rosy. I do wonder if it is still a honeymoon phase. Similar to my previous roles it’s been a slow burn, in that it’s taken a while to get going and you have the whole “well make sure you’ve read the intranet”, and “you’ve got this long list of courses to do”. As I intimated in my last blog, I’ve definitely hit the ground running at Difrent, and whilst there is a very thorough onboarding process, I have been in the position that I already knew the organisation, their culture, and what the expectations were on me. To get stuff done! To pursue Commercial and Procurement excellence. Hence the hesitancy in saying I’m still in a honeymoon period as I’m straight in, doing the do, and one could say I’m properly married to Difrent now; I’m not looking for divorce anytime soon either!
I struggle to think about what I’m going to write with these blogs, and then I start typing whilst listening to music (for those interested, it’s Michael Mcdonald tonight) and words come out of my brain, into my fingers and onto the screen. I’ve been challenged, in a good way (I love to be challenged), by my colleague and I would say friend, Kirk, to find new ways of doing things and to think about Procurement, specifically a tender, in a slightly different guise. My work has predominantly been writing Invitation to Tender (ITT) template docs for the past few weeks, specifically the contract template for our client’s upcoming system purchases. My superb colleagues have been requirements gathering, and Kirk, a Business Analyst, has been turning those requirements into actual tender worthy requirements which can be shared with suppliers, with the able help of Sajiv to make sure we’re ticking all the techie boxes. It is now time to populate these documents with the salient points to allow suppliers to bid for the work, and to quote Kirk,
I love this analogy and it really helps stakeholders to understand the crux of an Invitation to Tender, or Request for Quote, or Request for Price, or whatever one wants to call it. That with a lot of what is being purchased it isn’t always necessary to be 100% confident, and upfront with what an organisation is looking to purchase. Now, I could get all technical and talk about how one could have an output or input specification, or performance or even a conformance specification. An output or performance specification is where an organisation essentially lets the market decide how something will be provided. That is to say, an organisation will want to buy a thing and doesn’t know how to get the things done and so asks the market to decide. For example, a woolly performance specification would be that we want an organisation to clean our offices. The organisation is not fussed when and how this is done, or even how often, and I’d guess their staff morale would drop pretty quickly, but it is a fairly simple example of a performance specification. An input or conformance specification is where an organisation knows precisely what it is looking for a supplier to provide. To use the cleaning example, they would ask the supplier to clean the office three times a day, including all desks with a specific polish and duster, and on Mondays, Wednesdays and Fridays to use beeswax on the desktops.
To take this to the next logical step an organisation goes to market with an ITT, with a set of requirements, and I’m gonna shorten and simplify this, and the supplier comes back with a proposal which the buyer either accepts, rejects or negotiates. Once agreed by both parties a contract is signed and the service is provided. However, there’s some light footwork which happens there, or heavy depending on one’s procurement or negotiating style, and it tiptoes along like this:
1. An ITT goes out with a set of requirements. The buyer is pretty clear with their requirements after extensive user research and knows what they want. But then, shock horror, the supplier comes back with some questions about the requirements and doubt sets in. The buyer questions the requirements or gets bullish about them, and they can then get refined. This is a normal reaction for most people. As a Procurement professional, I want to get things right, and I want the market to know, or give the impression that I know what I’m buying. It gives me the upper hand in terms of knowledge if I have to negotiate. This part of the dance actually helps both parties to refine requirements, and for the buyer to better understand what they’re looking to purchase, and for the supplier to better understand what the buyer is looking to buy.
2. The ITT comes back and suppliers have said how they can deliver the service and told the buyer how much they will charge. Simple! Its examined, checked, scored and there should be a winner. This doesn’t sound like a dance I hear you say; well in truth, nothing about this is particularly Strictly. However, it is an offer. It is the dancer holding out their hand to their partner waiting for them to hold it and come into the hold. There then needs to be acceptance. The partners come into hold and Paso across the dance floor. Thus, the relationship and the dance continues. I’ve been very specific with my choice of dance here. A Paso is the dance of the bull, it’s the battle, and that’s often how buying is perceived. We don’t work in partnership. We work at odds with each other. In short, a buyer wants something and a supplier wants to supply it and make some money, and both want no hassle!
3. You’ve signed the contract and the service begins. Great! Easy? Nope! It should be, but there will always be doubt about what is required on both sides. They’ll be disagreements about what items meant in the requirements, and they’ll be jostling for position. They will, or should be, learning on both sides. What we’re all aiming for is a ballroom dance, such as a waltz or Cha-cha-cha, something where the two dancers are working together, or in contractual terms the two organisations are working together.
4. The partnership has begun and it should be a partnership. You’re not always going to get on, you’ll have ups and downs, and what you’re looking to do is have open, honest conversations within the spirit of the contract. I’ve worked on many, many contracts from £5k taxi contracts, and £72m mobile phone contracts to £1.2b maintenance contracts, and one of the key things I’ve taken from these is when each party starts to get into the weeds and minutiae of a contract the relationship has taken a beating and it takes a huge amount of work to bring the partnership back to a historical standing.
To conclude, I find the ITT, the tendering, getting the stuff, and then the build-up the most exciting and exhilarating part of Procurement, and yes I know I’m a geek! I get to work with people, and I’m a people person. I get to help people, and that’s the reason why I do what I do, to allow Procurement in its small way, to make the world a better place. So, reader, begin the dance, focus on spinning and twirling in unison and working together.