In the latest whitepaper published by Source One, available here, the relationship between procurement departments and their organizational peers was discussed. Specifically, how procurement personnel rate their department’s value to the company compare to how others in the organization rated procurement’s value. The result was a bit humbling – there is a 21% gap between procurement and the rest, with procurement coming in much higher – but there was another statistic included in the paper that highlighted, and likely explained, the gap.
Procurement personnel were asked if they marketed their department within their organization. An overwhelming majority said yes. Nearly 70% of all respondents claimed they were promoting their value internally. When those respondents were asked what, exactly, they were doing to promote their value, most said “reporting”, a little over half said “project transparency”, and a few said “training” and “stakeholder involvement”.
As stated in the whitepaper, reporting is so critical to the procurement process, it should not be considered “marketing a department externally”. It should be considered part of the process. The same can be said of “project transparency”. Keeping others in the loop about what you and your department are doing is not so much a marketing effort so much as it is a common courtesy. That leaves “training” and “stakeholder involvement” as the only remaining marketing efforts of note, and far fewer reported doing either of those than claimed they were marketing their department externally. So there’s some confusion.
The best way to clear up this confusion is to understand what marketing actually is, and what it entails. Once procurement understands what marketing is, it can implement effective marketing strategies. With those effective strategies in place, procurement’s organizational peers will better be able to see the value procurement brings to the organization, and the value gap will dwindle, and hopefully disappear.
What Is Marketing?
Loosely defined, “marketing” is the act or process of communicating the value of a product or service to customers, for the purpose of selling the product or service.
What Does “Marketing My Department Internally” Mean?
Using and modifying the definition above, to market a procurement department internally, a group would communicate the value of its department’s services to customers – here, the rest of their organization, particularly category stakeholders – in the hopes of selling those services. In this case, “selling” includes both raising awareness of procurement’s activities and encouraging the use of the department’s services.
So How Is It Done?
The whitepaper showed that a large portion of procurement personnel feel that reporting is a method of marketing their department. In reading other articles on this matter, it seems reporting is just about the only marketing technique ever considered. So before we go any further: yes, technically, reporting is a marketing technique. Reporting the cost savings secured by their department to other departments (commonly, finance) and organization executives is, however, so common and necessary to the function of procurement departments nationwide, any reporting conducted will be seen as a “procurement’s job” and not “marketing efforts”. Not that it cannot be effective, so long as it is tailored to an individual audience and clearly illustrates procurement’s achievements (read: more dressed up than a spreadsheet).
Transparency was also one of those tasks commonly listed as a marketing effort, and also falls into the category of so essential that it’s part of the job. But it is essential, and really only requires getting status reports out to other stakeholders and executives in your organization so that they have a clear view, at a moment’s notice, as to what procurement is doing.
Source One has seen success with marketing through training – though not in the traditional sense of training. Establishing criteria for when to involve procurement, or developing an LMS program, is fine from a pure training perspective, but there are methods that can be put in place that train while putting procurement in a great light. With some of our clients, we have found that establishing informal meeting sessions – putting procurement officials out there in front of various departments – has worked to increase communications and rapport among those teams and lessened stakeholder resistance to procurement involvement.
Another success has been the packaging of procurement services and slickly presenting them as shared services – toolsets and skills that can lighten the workload of other organizational departments while shifting the perception of procurement from a group of rubber-stamping bureaucrats with lists of requirements to that of a team whose purpose it is to further the goals of the organization at large.
As all organizations are different, the exact strategy necessary to better market your procurement group internally may involve some, all, or none of the strategies outlined above. It’s difficult to perceive a scenario, however, where targeted reporting, specialized training messages, and/or a slick packaging of procurement services wouldn’t help in some part.