This is the third blog post in our series, I’m a New CPO; Now What?
In our prior posts, we discussed how to understand the business culture, stakeholders, and how to assess your procurement organization’s maturity. Now that you have these understandings, you can begin to manage the communications, business expectations, and change management necessary for your procurement strategy.
Manage the communication, business expectations and change
Internal communications and expectations management is critical to the successful development and implementation of your procurement vision and strategy. I would argue that we all know that the success and failure of a project or initiative often relies on the endorsement and support of internal customers. If this is the case, ensure they are involved and engaged from the outset. Don’t let the pressure of near-term cost savings and efficiency wins minimize your customer’s priorities. An ultimate win is if your customers are communicating to the broader company that your organization’s support helped them successfully reach their goals.
What does this mean for you and how you develop your strategy and manage communication, business expectations and change? A starting point could be developing an Impact Assessment in which you identify the key KPIs or triggers for each stakeholder group that you are supporting. Deliver and continuously refine this Impact Assessment based on a continual feedback and improvement loop. This coordinated approach with your stakeholders develops deeper buy-in to your strategy while simultaneously managing expectations.
Managing communications. A communication plan forms the foundation of where your results are shared and communicated. As a CPO, you should have a clear and concise way to reach your audience by using the input and business intelligence you learned during the “understand” phase described in an earlier post.
Elements of your communication plan might include:
- A monthly Procurement Steering Committee
- Update, revision and key initiative decisions are made for your current sourcing pipeline and policy execution.
- Monthly procurement 1-page newsletters to the businesses. Focus on the execution of your procurement/sourcing strategy and highlighting collective team wins.
- Development of a “Center of Excellence” where more frequent and detailed communications are posted with the business unit’s working teams
- Internal “Procurement Portal” that is more tactical in nature focusing on elements needed to run the business such as: Catalog Punch Outs; Vendor Managed Inventory (VMI) programs; Industry Benchmarking.
Manage expectations. As stated before, it is important that you have established clear understandings of expectations and buy-in from both your internal and external stakeholders. In doing this, you should remove any potential ambiguity about initiatives, actions, timelines and measurements through top-level peer to peer alignment. Work alongside the businesses to assess what they are trying to achieve and manage expectations about what is really possible to achieve and in what timeframe. Using your Procurement Maturity Assessment (PMA), discussed in a prior post, you have the opportunity to align them to your gaps so that they become internal advocates. If they can help bring investments to close those gaps, you’re that much better off. The following are three suggested approaches you can adopt to manage expectations:
- Set the expectations: Discuss, inform, agree and set expectations with stakeholders
- Monitor expectations: Define measures (both quantitative and qualitative) and track them, sharing results within the organization and your business partner units. These may include:
- # of projects supported
- $ of spend in pipeline
- Cost savings/avoidance impact
- # of contracts closed
- Influence expectations: Share expectations and performance more widely to drive alignment and delivery.
Manage change. Part of your role is that of a change agent, or transformation ambassador. You become an effective leader by building capability and capacity to create a long-term plan enabling systemic change. By starting the engagement and involving these stakeholders in shaping your procurement strategy, you may have to balance and manage these competing stakeholder’s priorities and agendas to build momentum and support across the enterprise. A cohesive and well-articulated communication plan allows for effective change management. As you move into the implementation phase of your strategy, this change management base will serve you well, and enable you to maximize your team’s performance.
In the next post we will dive into the “develop” phase of your procurement strategy. We’ll discuss developing your procurement vision and plan, including the “why” and the “what” at the business unit level.