In one of our planning sessions for the December 7th AOP Live session with Greg Anderson and David Clevenger, they told us, “Let’s face it – No one outside of procurement cares about a percentage increase year over year in spend under management.”
Sad but true.
But we can’t walk away from procurement-centric metrics like spend under management and savings because in many cases, they are still used to evaluate our performance. Maybe we’re saying the right thing using the wrong words. After all, even the idea of spend doesn’t hold much meaning outside of procurement.
Improved options might include the percentage of a team/business unit/department’s budget:
- On contract
- With preferred suppliers
- That can be purchased with self-guided buying
- With certified diverse suppliers
- With suppliers that have performance scores above a certain level
- That has been competitively negotiated/sourced in the last [time period]
Knowing which option(s) to pick for each stakeholder group will be a combination of corporate priorities, factors influencing those stakeholders, and available data. Being able to connect with them on metrics such as those should not only hold more meaning, it will engage them and increase compliance.
The idea of investing in the customer experience is growing – even within procurement – but it doesn’t necessarily mean we have to change what we do to make our stakeholders happy. Sometimes we just have to explain the progress we are making in terms that have more meaning to them.