This guest blog comes to us from Megan Ray Nichols of Schooled by Science.
Procurement consultants are vital to the success of any supply chain. Top-notch procurement can have a substantial impact on a company's profits, but this high potential comes with a hefty responsibility for procurement professionals. If you're in charge of acquisition, your decisions can make or break a company's success.
You may be a good procurement professional, but are you a great one? With the right strategies, you can present an impressive return on investment to your company. Here are five steps to becoming a better procurement professional.
1. Build Relationships
The effectiveness of any acquisition effort hinges on the buyer's relationship with the seller. A stranger with robust industry knowledge may be able to negotiate a fair price, but an acquaintance will get an even better deal. If you hope to be a leading procurement professional, you'll need to build and maintain industry relationships.
The benefits of having strong relationships with suppliers don't end at smoother negotiations. Having connections with a variety of vendors and other professionals can give you insider knowledge. You'll hear about coming market shifts or price changes before other, less connected procurement specialists do.
If you work as a freelancing consultant, you should also build healthy relationships with your clients. The better you understand them, the more you'll be able to meet their specific vision.
2. Consider the Minute Details
The best procurement professionals are those who understand the financial impact of every detail. Nearly countless factors play into a company's spending, many of which you probably don't initially consider. To improve your merit as a procurement professional, learn what small details you may be overlooking.
Seemingly insignificant factors can add up to a considerable amount of money over time. Nothing is too small for you to account for in your budgeting. Consider every instance of payment throughout the supply chain, not just the big-ticket items.
Some items or processes are likely more connected than you'd think. To further understand the extent of all influencing factors, you can turn to technology for help.
3. Take Advantage of Technology
There are plenty of technological tools at your disposal nowadays. To be as effective as you can, you need to take advantage of these assets. Leveraging technology can help you streamline tasks and identify areas for improvement.
Using tools like project management software, you can offer more thorough and precise cost analytics. More advanced technology, like business intelligence tools, can help you gain a better understanding of the connections between all your processes. These services save you time and will likely highlight considerations you haven't thought of yet.
Becoming familiar with technology can also help you determine the best fit for your company's needs. The industrial world is moving toward advanced tech and automation, so it pays to understand these tools. Machines and software are often more cost-effective than traditional methods for most processes.
4. Recognize Industry Benchmarks
The qualifications for what constitutes outstanding procurement invariably change. To stay competitive, you have to know where the competition is. You should always be aware of industry benchmarks and use them to guide your processes.
By benchmarking, you can see how your company's spending compares to industry standards, giving you a tangible goal. Whether a contract is a good deal or not depends on what other businesses are getting. Without benchmarking, you won't know how competitive your company is.
Benchmarking also applies to you, not just your company. As you're improving in your work as a procurement professional, so will the industry as a whole. You'll be able to develop a better plan for professional growth if you know what companies should expect from your work.
5. Know Your Impact
To be a competitive procurement specialist, you have to understand how all factors contribute to success. This concept applies to your work, as well. You should appreciate how your actions impact the company as a whole.
Know the costs of your operations, but also look ahead to the payoff if you excel in your role. If you understand the broader effects of your role, it won't just improve your performance, but it will help you market yourself. You'll offer a more convincing argument to both clients and suppliers if you know how exactly you can help them.
A good procurement professional understands the long-term impact of their purchases, but a great one also knows the advantages they bring to the table. If you don't consider yourself, you're not accounting for all influencing factors.
There are no quick and easy tricks to make you an outstanding procurement professional. But there are measurable, knowable steps you can take to better your work. Most of these steps boil down to you developing a thorough understanding of how small details lead to major results.
An exceptional procurement expert knows how making the slightest adjustment will affect company profits. The path to gaining this knowledge is likewise full of making small, seemingly insignificant changes. Following market trends or fostering relationships with suppliers may seem like secondary tasks, but they're what separate good specialists from exceptional ones.
Competitive procurement is a complex, multi-layered process. If you overlook the importance of seemingly minor steps, you're not getting the full picture.