HOW TO FIX OUR REPUTATION PROBLEM

Michael Shields is VP of Procurement at Tropic and has spent his career in procurement across Fortune 100 companies and high-growth tech. He writes about procurement, negotiation, better collaboration with revenue teams and occasionally things that have are only remotely related. He’s also a huge fan of Tanya and what she’s doing.

When I step into a new Procurement role, the hardest part of the job is often getting people to actually want to work with me.

That was certainly the case when I was the first hire at Qualtrics nearly 10 years ago.  

I knew I could add value. I imagined myself plucking all sorts of juicy savings fruit.  After all, I was working an “orchard” that had never been managed before.  And yet my phone wasn’t ringing.  

Buy-in was low. “Spend under management” was basically non-existent.   If I was brought in at all, it was at the last minute.  People didn’t even know me and yet because my title was “procurement” I already somehow had a negative reputation.  

It’s easy to play the victim card here, but if we are painfully honest with ourselves, we’ve earned some of this reputation.  If we wait to get involved until someone involves us, it’s going to be hard to show any real value.  After all, our ability to add value dramatically increases the earlier we get involved. 

Additionally, sometimes we whip out the procurement policy and explain the dozen reasons why we can’t do something as opposed to finding a way to make it work. (Here’s a lesson I’ve learned the hard way:  leading with “no” isn’t exactly an effective method of building relationships).   

It took me a little longer than I’d like to admit, but eventually I threw out the “procurement playbook” that I had brought with me from my previous role. 

Here are three things that actually moved the needle:

1. I helped them see that it's not that they can't do it. It's that they shouldn't have to.

When I arrived, stakeholders were handling their own vendor negotiations.  Same with sourcing.  Some procurement people might go to their organization and say, “I can do it better.”  

(Imho, that’s not exactly the best way to make friends)

If I’m being completely honest, some stakeholders are actually VERY good at it.  They are thorough project managers.  They are savvy negotiators.  

So, what?  Just let them do their thing?

No, I’d argue that this “effectiveness” is actually part of the problem.   

If the engineering lead is spending 6 weeks sourcing a new supplier and closing the contract,  one of two things is happening. 

1. They're doing it really well.  And it’s a huge distraction from what they were hired to do (and pulling them away from engineering priorities).  

2. They're rushing through it, leaving money on the table, skipping due diligence, and signing something that Legal is going to hate in 18 months.

Neither outcome is great.

The reframe that worked for me: I stopped positioning procurement as a gatekeeper and started positioning it as a specialist service. Admittedly I need to be careful here or the nay-sayers will say I’m dooming our group to a life of being a support function. 

I am NOT advocating around the idea that we should just execute what stakeholders ask for.

Instead, I tried to bring a point of view. I would try to challenge assumptions. I used data to make recommendations on whether they should build or buy, whether a vendor relationship is worth preserving, whether a category is ripe for consolidation.  But most importantly, I tried to show how it benefited them by working with me. 

Instead of saying, “I can do it better”, I helped the leaders see why it would be in their best interest to let me do what I was hired to do (and allow their teams to focus on their priorities).  It’s powerful, so long as trust exists.  And that leads me to point #2. 

 2. I stopped leading with savings.  I know… crazy right?

Leading with "we're going to save you money on this” might not have the intended effect.  

Imagine you are a stakeholder who is not happy with their supplier.  If I come to you offering to cut costs, you might think, “sounds like a great way to make a bad situation worse." 

And stakeholders who love their current supplier hear: "We're going to squeeze the people you have a great relationship with. I’ll beat them up and then walk away leaving you to have to work with them.”  

Also not great….

So I stopped leading with savings and started asking simpler questions: what’s going well?  And what’s not going well?

I remember working with a marketing leader whose supplier was behind on lead generation commitments (not to mention overpaying for the service).  Instead of telling them they were over-paying, I said, “let’s do a sourcing event to find a supplier who can perform better.”  

Guess what his reaction was?  Shocker:  He genuinely got really excited about the opportunity to work with me. And when I showed him data about who others were using and what their strengths were, I built credibility that I knew what I was talking about.  

When you understand the actual goal, you can build a procurement strategy around it. 

So what…..we forgo savings and potentially drive the price higher?  

Admittedly that might happen (although in that situation, you are probably delivering strong value).  But more often than not, savings almost always shows up anyway.   Performing a sourcing event and leveraging competition inherently sharpens the pencil of suppliers as they push to win the business.  The only difference is that  the savings comes about as a by-product instead of the focus.  

The problem here is that it requires time.  And if I wasn’t being brought in until the last minute, then sourcing becomes really hard to pull off.  That’s where step #3 comes in. 

3. I didn’t wait for an invitation.  I improved visibility and invited myself.  

I hear people state all the time, “I’ll die on this hill” (referring to things they feel strongly about.)  Personally, I’m not sure there are really any hills that are worth dying on… especially when it comes to B2B procurement.  But, if I did have to pick a hill, it might be this one: Strong visibility is the foundational layer of procurement.  

Too often we are negotiating without any market data.

Too often we find out about a contract 30 days before it expires. 

Too often, we show up asking more questions than providing valuable insights.   

Admittedly when I started at Qualtrics, we didn’t have all the cool procure-tech that we have today.  And we certainly didn’t have AI.  But I was determined to arm myself with the right data and visibility so I could walk into a stakeholder conversation with actual insights instead of just a good attitude. 

At the time, I focused on a few quality data points.  

• Contract end dates were crucial (plus the ability to track them). 

• Some sort of supplier CSAT data was killer (thankfully I worked for a “survey” company)

• Benchmark data - This was tougher then but I think it’s much easier now.  (It's honestly one of the reasons I'm so energized by what I'm doing at Tropic).  

Guess what happens when procurement teams have real visibility into their contracts and real market data to back up their recommendations?

•  The whole freaking dynamic shifts

• You stop being reactive (yay!)

• You stop always playing catch-up (sounds great right?)

• You actually have something worth bringing to the table before someone has to come ask you for it (welcome to the world of being a valued partner)

In procurement we always need to be stepping up our game… constantly improving our performance. 

But we also need to be improving how people perceive us. It’s tackling the problem from both sides. 

Improve the value we offer +  Do a better job of helping see it. In my experience, that’s a recipe for success.

Freebie(s) of the week

THE AI PROMPTING TOOLKIT

Last week I joined a webinar hosted by Vertice with two friends of mine, Tom Mills and DXC CPO Anders Lange. The session was called Six AI Tips to Get Ahead and it was genuinely one of the more practical conversations I’ve seen on the topic.

But something struck me while listening to the questions and comments coming in from people attending.

A lot of procurement professionals still don’t really know where to start with AI.

Specially in what I consider the basics of it: how to prompt.

To me prompting feels almost obvious at this point. I’ve been using AI tools constantly for the last couple of years and writing structured prompts has become second nature. But I guess that if you haven’t spent time experimenting with it, it’s actually not obvious at all.

If you open ChatGPT for the first time and type something like “analyse this supplier”, you’ll get a very polite paragraph that isn’t particularly useful.

The difference between that and something genuinely helpful usually comes down to how you frame the question.

And it felt slightly unfair that something so simple could create such a big gap between people who get real value from AI and people who conclude that it’s mostly hype.

So I decided to put something together.

I went back through the prompts I use most often in my own work, the ones that consistently produce useful output, and organised them into a structured library.

Then I dug out some of my old notes on prompting, frameworks I’d written for myself over time about how to structure prompts properly so the AI actually produces a decent analysis.

The result is what I’m calling the Procurement AI Toolkit.

It contains two things.

The first is a Practical Prompting Playbook, which explains how prompting actually works and the simple framework I use to structure prompts so they produce useful procurement analysis.

The second is a library of 12 advanced prompts covering the things procurement professionals spend most of their time doing anyway: supplier research, market analysis, negotiation preparation and contract risk review.

My hope is that this helps level the playing field a little. Everyone should know how to prompt well. It’s becoming a basic professional skill in the same way that knowing how to use Excel once became one.

Because I think this toolkit is genuinely useful, I wanted to make it available to readers of this newsletter first.

For the next 36 hours, subscribers to The Procurement Blueprint can download it for free.

This is the shortest window I’ve ever done for a free resource for but it felt right to reward my most avid readers the most.

If you’d like to explore it, you can download the toolkit below:

Download the Procurement AI Toolkit here

Do you want access to other great templates from previous newsletters? Have a look at the full store below:

That’s it for this week.

Next Monday my son turns four.

Four feels like a big one. Somewhere between “still a baby” and suddenly a small person with opinions, stories, and very strong ideas about which dinosaurs are superior to others. So this weekend we’re doing something a little special and taking him to a farm to celebrate, which he is unbelievably excited about. There will be animals, mud, probably some cake, and if things go according to the laws of small children, at least one moment where someone refuses to leave because they have formed a deep emotional bond with a goat.

I’m quite looking forward to it.

Partly because birthdays like this feel fleeting. You blink and suddenly they’re older than you expected. But also because there is something very grounding about spending a day surrounded by animals and children who are completely unimpressed by LinkedIn posts, procurement strategies, or anything resembling an adult career.

A useful reminder from time to time.

Sometimes the most important work we do in a week has nothing to do with work at all.

Until next time

Procurement worth reading.