Today I have an article from Opencanada.org discussing the need for more procurement professionals to ensure Canada’s military is safe.
It may seems like two unrelated items (a lack of procurement professionals and the safety of military personnel), but Steve Saidman correlates the Canadian government’s ability to effectively spend military resources with a lack of skilled procurement professionals.
I love it when the value of procurement is highlighted!
Saidman goes on to discuss the complexities of decision making in the Canadian government, noting, “a cumbersome bureaucracy involving multiple ministers which means diffuse accountability — no single minister is accountable because several partially are. This means that decisions get delayed, which in turn means that money goes unspent.“
It should come as no surprise to hear that a government like Canada has a complex decision making bureaucracy. Almost every modern government does.
As I read Saidman’s article I could not help connecting the complex disjointed procurement and decision making process of the government of Canada with the complex and disjointed process of many of the World’s largest companies.
I’m sure that is no surprise either!
Large companies are as complex if not more complex than some world governments and the processes they have for procurement and decision making are equally complex.
As I read Saidman’s article I started to contemplate the paradox that occurs when a large complex company fails to recognize its complexity and instead tries to identify itself as “agile“. This happens far more than you might think.
In the context of Saidman’s article a lack of procurement professionals means that Canada’s military may find themselves with fewer ships, less armor, or fewer bullets. In a corporate context, organizations with misaligned processes suffer from rouge spend, lost aggregation, and missed savings.
For a procurement consultant like me, it’s quite common to step in to a new organization and observe corporate behavior that screams complexity yet hear corporate messaging about quick responses and centralized decision-making.
It’s a struggle that I have seen at many organizations.
You might think that a misalignment in messaging and culture may be benign. Once the in-congruence is recognized, that should be enough to help you navigate the organization, but when corporate messaging isn’t aligned with corporate culture, organizations fail and often the root cause is never uncovered.
This happens for several reasons:
When a corporation hires a Business Process Outsource (BPO) consultant, one of the first tasks is to develop a procurement process to join the organization’s internal teams with the consulting team. This is often developed during the early stages of a transition phase.
During the transition phase, processes for communication and reporting are established. This is essentially how the teams agree to work together.
If there is a misalignment between messaging and culture, the transition team is not likely to pick up on this. Transition teams are typically there only for a few weeks, hardly enough to recognize such misalignment. This leads to documented reporting processes that are either too heavy or too weak.
A misaligned reporting process leads to stakeholders that either feel bogged down and burdened by too much reporting, or stakeholder that feel uninformed and out-of-the-loop with the consultant team’s activities.
Either scenario creates frustration and resentment in a dynamic that is often stressful to start.
For these reasons, when setting up your procurement process, be careful to align the process with your culture regardless of what your corporate messaging might be.
Expectations for Time to Procure
In previous articles I have discussed how time-to-procure is heavily dependent on several participants other than the procurement professional.
That is not to say that procurement professionals are not sometimes responsible for delays in the procurement process, but in my experience, we are most often held up because an action from another party is required in order to move forward.
I’m looking at you legal!
When an organization has a misalignment between culture and messaging, the expectations for turn-around could be misaligned.
This becomes especially evident when we interface with other Stakeholders who’s own manner may be more aligned with the organization’s actual culture.
A misalignment in timing often leads to some of the greatest levels of frustration causing a great deal of friction between procurement and operational stakeholders.
Having a realistic view of your organization’s culture will help you better adjust your schedule expectations.
For many categories, contracting structures don’t vary greatly, but in construction, we have a number of delivery models and pricing models at our disposal. We can use firm price models, variable price models, single provider delivery, multi-provider delivery, and any combination of the above. Today we even have collaboration models which are entirely unique, variable, and complex.
This is one of the great and interesting features of design and construction as a procurement category. We can solve for almost any operational complexities simply by modifying the delivery or pricing options we choose.
Some of these models lend themselves perfectly to more agile work environments who live and die by the phrase “fail fast”. For more mature organizations who might look to present themselves as agile, the reality is that they are far less comfortable with these models. Attempts at leading an organization down one of these paths invariably leads to fear and frustration.
Attempting to align an organization that says they want flexibility but struggles with variable pricing is a misalignment that promises to fail. I’ve learned this particular lesson the hard way as I have attempted to lead Stakeholders towards a variable pricing model when they simply did not have the stomach for it.
This is another example of how saying your organization is agile when it is not can lead to in-congruence and conflict. Take heed of your Company’s tolerance for variability and be clear about your ability to manage change. Proper alignment will help clarify your needs and lead to contracting structures that suit you.
The Root Cause
These examples of how misaligned messaging leads to problems in procurement are actually more common that we would like to admit.
Post Mortem reviews with stakeholders about what went wrong with one procurement project or another may result in findings that point to specific failures in specific tasks. These kinds of results may be too myopic, failing to take a grander view of the procurement system itself.
Reviews that don’t ask the larger question of, “Is our culture aligned with our messaging?” may completely miss the misalignment causing the organization to continue to operate with no clue about the root cause.
If you find that your procurement team is consistently missing deadlines, projects are consistently troublesome and difficult to manage, or you either feel disconnected or burdened by reporting, shift the focus away from your procurement team. Be open and honest about your corporate culture and consider the possibility that you are experiencing some misalignment.
Such discoveries need not be treated as failures and no one needs to be held responsible. Simply recognize the issue and seek to find ways to better align your process. Procurement should be seamless and should add value, anything less suggests a need for a change.
In the case of the government of Canada, their misalignment comes from too few procurement professionals with too high of a military budget. We won’t solve their issues with this article, but for you, recognizing that we often say one thing when reality is something else should help you to effectively navigate these obstacles.
Is your organization presenting itself as “agile” while still bogging you down with process? Or do you have an “agile” start-up that has bogged itself with heavy reporting processes? Have you observed this misalignment before? Tell me your stories.
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