Post on 08-Nov-2018
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Procurements Strategic Contribution
Leadership vs Management
1
Richard May
ArcBlue (NZ) Ltd
November 2014
UK EUROPE AFRICA AMERICAS AUSTRALASIA ASIA
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Structure of this presentation
Leadership versus Management
The language of Procurement versus Business
Some personal thoughts
A
B
C
Meet a current procurement “leader”
Introduction
D
E
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ArcBlue is part of the global PMMS Consulting Group. We are a specialist consultancy group focusing upon the buyer:supplier interface. Since 1978, we have been supporting private and public sector organisations across the world to achieve more from the management of those resources external to an organisation on whom that organisation may rely.
About ArcBlue Consulting (NZ) Ltd A
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Meet Vince Aisthorpe – Manager Supply Chain B
Stanwell Corporation Queensland Australia State Owned Enterprise Electricity Generator
Supply
Strategic Procurement
Category Management
Logistics and Warehousing
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B Some background
• 2008 – Procurement Review
– CEO endorsed change programme – a key step
• 2011 – 2nd Procurement Review
– CFO comment. “Procurement is not strategic and cannot be in my
personal opinion”.
• 2014 – CFO is now CEO – Interview with CEO magazine
– “Stanwell has been working closely with suppliers to create value adding win-win arrangements. Thats something that has really evolved over the past couple of years and it really is a credit to our procurement strategy team to have achieved significant changes”.
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C Leadership vs Management
Management Order and Consistency
Leadership Change and Movement
Planning and Budgeting • Establish agendas • Set Timetables • Allocate Resources
Establishing Direction • Create a vision • Clarify big picture • Set strategies
Organising and Staffing • Provide structure • Make job placements • Establish rules and procedures
Aligning People • Communicate goals • Seek commitment • Build teams and coalitions
Controlling and Problem Solving • Develop incentives • Generate solutions • Take corrective action
Motivating and Inspiring • Inspire and energise • Empower sub-ordinates • Satisfy unmet and anticipated
needs
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Some examples of how Vince engages with exec team
CB
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Some examples of how Vince engages with exec team C
VISION
VALUED BUSINESS PARTNERS
DELIVERING TIMELY BEST OUTCOMES
AND VALUE THROUGH COMMERCIAL
SUPPLY SOLUTIONS
COLLABORATE Engage Early and Often
COMMIT Responsible and Accountable
COMPLETE Timely Best Outcome
Co
mm
un
ica
te
Safe, Responsible, Commercially Focused
MANTRA
KEY LEAD MEASURES
KEY PLANK MEASURE
SHAREHOLDER
$6M - $12M SUPPLIER RELATED BENEFITS
INVENTORY OPTIMISATION
OUTCOMES
EMPLOYEES
EVIDENCE OF IMPROVED
CAPABILITY FROM
LEARNING & DEVELOPMENT PROGRAM
CUSTOMERS AND COMMUNITY
POSITIVE CUSTOMER FEEDBACK
VALUE CHAIN EVIDENCE OF MORE
EFFECTIVE PROCUREMENT PROCESSES
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Leadership Styles C
Style Examples Challenges
Pacesetter
Authoritative
Coaching
Affiliative
Coercive
Democratic
Do as I do - now Can overwhelm
Come with me and be inspired
If team knows more than leader
Try this Problematic if change resistance
People come first Lack of direction & mediocre results
Do what I tell you Can alienate, stifle flexibility
What do you think? Takes longer, more consultation
V
V
V
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SDI – Leaders and their people C
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Different types of leaders in a change programme C
LINE LEADERS Line Leaders are those with accountability for results and sufficient authority
to undertake changes in the way work is conducted and organised at their local or project level.
INTERNAL NETWORKERS and COAL FACE LEADERS
Those internal networkers (engineers, project managers, HR, Training, Contract Managers, etc who participate in ongoing “communities of better practice” (Could be SASP or project procurement teams)
EXECUTIVE LEADERS
Have overall accountability for organisational performance. Recognise that “this ‘procurement change’ is a new ballgame”.
Vital for successful change through efforts to create organisational environment for continual innovation and knowledge generation.
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‘Procurement Change’ needs a end-to-end process, outcomes and benefits focused
D
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Needs a different language “at the top” – income statement C
Funding/ Revenue 100
Internal Costs (Labour) (30)
Bought in goods and services (56)
Margin 12 Other o’heads, Tax/int (3) Surplus 9
Investm’t in Funding/ Revenue 100
Investm’t in Internal Resources (30)
Investm’t in External Resources (56)
Margin 12 Other o’heads, Tax/int (3) Surplus 9
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Needs a “Business Value Chain” approach D
ACQUIRE VALUE
Sources of
EXTERNAL RESOURCE
BUILD VALUE
Sourcse of
INTERNAL RESOURCE
Deliver perceived
VALUE
SUPPLIER/
PROVIDER
SUPPLIER/ PROVIDER Organisation
INITIAL
CUSTOMEr
Or FUNDER
Ultimate
Customer
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It requires a longer-term view D
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Recognises that one size does not fit all D
Looking out into Supply Markets
Supply Positioning®
How external providers view you
Customer Preferencing®
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Some Personal Thoughts
E
Procurement versus External Resource Management focus
Business understanding versus Procurement versus language
Proactive positive injection and being aware and listen carefully
Focus on NEEDS
Have high positive energy, never a bad day at the office.
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Some Procurement questions for Leaders
E
Have we ………….
Created the supply markets our organisation needs for it to succeed with its corporate strategy? Used “Category Management” to look strategically forward?
Recognised that Procurement increasingly viewed as a litmus test for acceptable behaviour
Moved measurement beyond “cost savings” into “Strategy Execution”
Thrown off the curse of ‘cost-reduction’ and ‘price focus’
Created corporate culture around ‘acquiring value - building value –delivering
value’
Thank you