One of the most memorable conversations I had in 2020 was with Dan Symon, the Chief Procurement Officer of New York City. He and his team faced a uniquely complex set of challenges as the pandemic hit and then spread, effectively shutting down a city of 8.5 Million people.
Dan and his team set up a response operation within 24-48 hours in an effort to get as much PPE and as many ventilators as they could. The urgency of the situation did not permit them to follow the usual sourcing channels and process, and fortunately the Mayor’s emergency order exempted them from public sector purchasing regulations. While that step may have broadened their options, it didn’t make the effort any more pleasant. Here is how Dan described it:
“Imagine what your junk folder looks like, on a day-to-day basis. That is what we jumped into. Ultimately, we were successful, but I never want to go back there again because there was price gouging, and people taking advantage. We were in a moral conundrum because we were desperate for the supply and every single engagement sounded precisely the same. Even the most nefarious individual started by saying, ‘I just want to help New York.’”
As conditions in the city stabilized, procurement pivoted to responsive agility. They set themselves up as an importer of record, which allowed them to buy and pick up materials themselves instead of relying upon suppliers to deliver them. This is one change that Dan hoped would become permanent, even after a return to ‘normal’ – something we are still waiting for.
Investments in technology made it possible for them to maintain transparency into their supply chain, even on the most hectic of days, and to accelerate the process of making decisions and placing orders. Process re-engineering work that was originally motivated by a desire to increase efficiency and convenience also delivered in the face of risk and supply insecurity.
“Digital transformation is a prerequisite for what we really want to do, which is business process re-engineering,” he said. “In this new world, we are able to open the process up and make it transparent to everyone. That, in turn, creates speed. Nobody wants to be the one that’s sitting on ‘the thing,’ whatever that happens to be. When everybody can see where everything is, something that can take five minutes will take five minutes instead of five days, five weeks or five months.”
New York City’s first pivot was forced by emergency declarations that removed nearly all of their guiding regulations and pushed them to accumulate short term supplies as well as 90 days’ worth of safety stock. The next pivot will be driven from within, as Dan and his team move from activity-driven to strategic, with the ultimate objective being to elevate procurement such that they hear plans and discussions from leadership firsthand. This will allow him to provide valuable additional context to his team, developing a shared sense of urgency and need around each new program and delivering more for the city and its residents.
For more insight into how leading CPOs are mastering their post-pandemic response, click here to download our whitepaper, produced in collaboration with the team at Ivalua.