What’s happening to the Sales profession when it comes to its engagement with professional ‘Procurement’ at the customer?
I honestly thought Sales professionals would all be used to dealing with Procurement by now, positively reveling in the challenge to articulate the value of their offerings to forensic, value-hungry buyers. Any yet, here we are in 2016 and it is still a problem for sales people, even those with senior account management roles. Their discomfort and sometimes fear in engaging with Procurement are complaints I hear about almost every day of the week.
True enough, during my 20-year career as a procurement practitioner, during which I led many a negotiation with suppliers, it wasn’t that difficult to intimidate Sales people into conceding price and rate reductions. In fact, we often considered it good sport, and for those us who like to keep score, rattling up cost savings from these negotiations was easily the most enjoyable part of the procurement day job.
Something changed for me about 15 years ago however, when I first began working with those on the Sales side. Initially, I was invited to speak at a Sales conference when I was introduced as ‘The Bad Guy from Procurement’, ostensibly there to impart some home truths to key account managers. At the time I might have over-egged the criticism of the Sales side; its fear of and failure to build relationships with Procurement, its lack of understanding what was really driving their relationships, and its ineptitude, in the face of cost reduction demands, in securing fair value for their own employers. Regardless, that particular session went down very well, and I began my own journey to understanding what makes Sales people (including account managers) tick.
Over the following few years I immersed myself in the theory and practice of key account management in particular (I was always more interested in how ‘strategic’ relationships could be made more successful), and intensified my work in helping the profession create mutually-beneficial relations with what they perceived as their negotiation adversary. I’m now proud to have trained and advised thousands of Sales professionals in Selling to Procurement, and my work in this sphere continues unabated.
Quick note to my Procurement colleagues, some of which will protest their commitment to collaborative working and their Supplier Relationship Management programmes. Let me say that what feels like collaboration to you, is emphatically not the experience of Sales people and strategic account managers. Collaborative relationships are in the eye of the beholder(s), and barring notable exceptions; the norm is experienced as coercive rather than collaborative.
But back to Sales: What surprises me now, is how incurious some of those in Sales can be in understanding their customer generally, and Procurement specifically. I say surprised because, as has already been implied, the procurement profession has been around for years, and has now certainly matured into a mainstream business function. Now I don’t manage Sales people, but if I did, I’d have a lot to say about why it’s no longer acceptable for account managers to blame ‘Big Bad Procurement’ for focusing on price and demanding reductions. In my book, there are no excuses for playing the victim and not proactively engaging customers’ Procurement.
Professional Procurement is simply a fact of life for today’s business-to-business account managers and it’s about time they began to more proactively understand (and act upon) a few fundamentals. So here are a few questions for those account managers who recognise that their engagement with Procurement has room for improvement:
- How well can you identify the different types of procurement organisation, understand how each type operates, and be clearer about who at the customer is ultimately making the buying decision?
- We know account managers believe their product or service has huge value-adding potential for the customer, but how genuinely critical are those products and services to the customer’s own business success?
- Are you able to get into the heads of the buyers and truly appreciate what motivates them, how they’re measured, how they strategise, and understand the potential for you to create a productive and mutually beneficial relationship?
- Are you satisfied that your account planning methods are rigorous enough, your analysis sufficiently robust, and crucially, Procurement-centric enough?
- What is your negotiation practice like? Do you use the ‘back of a cigarette packet’ method, or is your negotiation planning and execution the result of rigorous analysis and deep insight into what each party values?
- How do you shape up as an account manager? Do professional buyers see you as a resource that adds value to their business, or more of a ‘post box’ filtering messages between your two companies? In effect, does Procurement see you and your role worthy of the salary you take?
These are just a handful of questions that, if Sales professionals (including account managers) could answer confidently and positively, they would become the outstanding Sales professionals their employers need them to be. Not only would they be more successful in building effective relationships with Procurement, they would retain more business, and give themselves a much better chance of winning more business.
So if you’re a Sales leader, or an account manager, operating in a sector where your customers deploy professional Procurement practices (which is just about everywhere now), then start asking your team (and yourself) whether you’re fully prepared to engage with Procurement. The era when Sales people could successfully by-pass or ignore Procurement is well and truly over.