Procurement professionals seeking smart procurement technology should involve their IT colleagues as early as possible if they wish to avoid having purchasing plans blocked by a CTO.
Peter Smith, a former CPO who now runs a procurement consultancy, describes an all-too-familiar scenario. An organisation’s procurement department has a great business case for investing in new technology. This tech will demonstrably help to achieve cost reduction by, say, deploying advanced spend analytics and tail spend management solutions to yield appreciable savings. Financial approval to proceed is granted – but then a roadblock arises. The CTO/CIO isn’t happy.
Smith mentions several cases where CTOs have vetoed this type of purchase and effectively blocked the investment. The reason is a recurring one for procurement professionals: they are often better at purchasing than they are at selling.
Just because the numbers for the new investment add up on paper, procurement professionals still need to practice the arts of persuasion with their IT colleagues. As Smith puts it, procurement has to sell the idea to IT colleagues, not simply tell them.
That entails adopting the perspective of the IT department. How do the CTO and IT team see procurement’s great new P2P, source-to-pay or spend analytics solution? Will it add extra burdens to their workload or make it lighter? How many extra tasks will fall on their shoulders, or could it also prove a positive benefit to them?
If procurement leaders get irritated when presented with a done deal, it is a pretty safe bet that IT leaders will react in a similar way if confronted by a done deal from procurement (“just sign off this new software we’ve chosen. Oh, and install and maintain it.”).
Smith advocates involving IT colleagues at the early stages of a software purchasing plan, even in decisions over selecting providers. He says: “That can go a long way to getting their buy-in to the project, and make that selling step much easier.”
Steve has over 28 years of success as CPO, MD and Procurement BPO leader in a range of industries. Steve is COO at Odesma, responsible for Odesma’s delivery capability & infrastructure.