July 5. The day after Independence Day in the USA.
What the h*ck does such a day have to do with procurement?
Well, let me walk you through what I’ve observed in the last 24 hours.
On Independence Day – better known as “the Fourth of July” – many of us set off fireworks on our curbs at night. We marvel at the spectacular explosions. We smile at all of the fun that we save up for one day a year. We light stuff on fire for the pure joy of watching it burn.
And it is glorious.
By the time we’re done – usually around 11PM, except for the one obnoxious neighbor that most of us have – we’re ready to end the day. It’s dark. We’re tired. And, after all of the debauchery, the last thing we want to do is clean up.
Cleaning up would be pretty anti-climactic, right?
So, we retire to bed. And we wake up the next morning and look outside.
The new day’s sun illuminates our curbs where all of the remnants of the previous night’s fireworks still lie. Scraps of burnt cardboard are strewn about. There are ashes and scorch marks on the pavement. And perhaps even forgotten beer cans litter the walkways.
It ain’t pretty.
So, we have two choices: leave the mess for another day and bask in the memories of the preceding fun, or clean up.
If we leave the mess, it won’t take long before the more diligent neighbors get a lower opinion of us. One of them may look out the window constantly, waiting us to remove the publicly visible trash that makes the neighborhood look like a low-class community. Someone may even notify the authorities about our litter. Relationships with people that you have to live by for years or decades ahead can get damaged if you’re negligent.
So, you do what you’ll have to do eventually. You clean up.
Now, for the procurement correlation…
Think of fireworks like an exciting sourcing process.
There’s eager anticipation for a supplier selection, like watching the wick of a sparkling fountain slowly burn. There’s the drama of the position changes that happen in negotiations, like watching changing colors and sparks emanate from a skyward explosion. There’s the calculation of the massive cost savings, like the grand finale when multiple fireworks explode in such rapid succession you lose count of how many explosions you are seeing simultaneously.
But after the fireworks of sourcing end, what are you left with?
Disgruntled stakeholders who had to accept the dismissal of a supplier they liked working with. Supplier personnel who feel defeated because your negotiation skills compelled them to accept less profit than they intended to keep. Skeptical finance executives who are watching your numbers closely because they doubt your cost savings estimates are accurate.
In other words, you have a post-sourcing mess to clean up.
Just like there are consequences to waiting too long to clean up your fireworks debris, there are consequences to not cleaning up the carnage from your sourcing project. So, don’t wait to work with your stakeholders to ensure a smooth transition to the new supplier and the associated processes. Don’t wait to reach out to the supplier and let it know that the tension of negotiations is over and now you can focus on a mutually successful working relationship. Don’t wait to welcome finance executives to collaborate on cost savings reporting so that procurement cost impact can be corroborated on the organization’s financial statements.
Sourcing, like setting off fireworks, can be fun. But with that fun comes the responsibility to clean up any resultant messes.
A quick cleanup will prevent resistance the next time you want to light the metaphorical fuse of an RFP.