Every organisation I meet knows that to survive, let alone prosper in this fast-moving world, they need to change the way they manage their relationship with customers. Unfortunately, the same approach is not always applied to suppliers. Part of this challenge is that changing entrenched attitudes is easier said than done because change is not easy.
Every organisation wants to grow in some way – sales, capability, efficiency – but the essence is the same, achieving more. Amazingly, many people believe they can achieve their aims and objectives simply by having the same type of procurement relationships as before.
Unfortunately, this is the path to disappointment. History is littered with companies that didn’t notice the signs and failed to change the way they work with customers and suppliers. The result was that when change happened, it was dramatic and ruthless. Think Carillion. Think Byron. It can be very challenging to face the hard reality of a situation and take responsibility for starting to address it. Of course, change itself is not the issue. What makes the difference is the way we each choose to face the new reality. Organisations stumble and fall for many reasons, often self-inflicted. I’ve seen them all ranging from lack of clarity around strategy, not listening to customers or suppliers and poor engagement with staff to not having a business plan at all!
It’s self-evident that the level of understanding between buyers and sellers in the rail industry, especially with Network Rail and Government procurement needs to change in this country. The latest headlines about defence over spending on the new Dreadnought nuclear submarines with some costs being 5 times what was expected, is a classic case in point.
Good procurement comes from a collaborative way of working and one of the key parts of this approach is having a good understanding of each player involved. Understanding exactly what a supplier does and the way they work to deliver their product and services is key. Undertaking a discovery exercise often leads me to realise that a supplier is not great at everything they say they can do. They may actually be brilliant at a few things and poor at others. That’s fine, it’s about being clear about this so that I can bring in complementary experts to fill any gaps.
Discovery is challenging because it means getting out of the comfortable office and going to visit the factory in Sheffield, the depot in Manchester, the construction site at Old Oak Common, N.W. London. A scary prospect for some civil servants who don’t have, maybe don’t want, the benchmarks and insights that such field trips can bring. The old axiom of ‘travel broadens the mind’ is true here, it will help them to see the people behind the company name they’re thinking of appointing.
Given how much the rail industry is changing, and needs to continue to change, I think everyone in procurement should get out once a week and look at reality through the eyes of a supplier. I guarantee you’ll see things differently and this new perspective will increase your skills and confidence that the deal you strike will be better for both parties and be deliverable.