“BMS took the time to understand the cultural fit of the applicant and looked at how the applicant would impact our strategy moving forward.” Sales Manager, O2
The rise of the procurement specialist
During the recession, organisations have been forced to re-examine their spending, drive down costs and improve efficiencies where ever possible. This has led to contracts being renegotiated and supplier prices being hammered down. This has been an issue for all businesses but in larger organisations the procurement department has been given a greater strategic role and increasingly those that perhaps have had no such area of the business is now looking more seriously. We’re now beginning to see the (continued?) rise of the procurement specialist.
Businesses have been renegotiating contracts with their suppliers to get better prices and so the procurement specialist is always searching for the less expensive option, a persuasive negotiator whose main objective is to keep costs down. Business service suppliers therefore have had to negotiate harder than ever to maintain service level agreements and ensure margins aren’t squeezed too much. So how does the sales professional operate in such an environment?
In the very first instance, the rise of the procurement specialist means an already large buying circle now has got even bigger. So as a new business development manager, not only is there another person to research but you need to ascertain their influence. Are they a decision maker? They probably are but they are unlikely to have the final say. Will they carry a lot of influence? Well, it will depend on the size of the organisation and also how much more influence they’ve gained as a result of the recession. Sector could also have a bearing!
Not only are their more people to suss out but as businesses try to maximise value from their suppliers, the processes by which they procure services has become even more complex. There are ever more hoops to jump through with more stages and it’s now not uncommon to be sent an RFI initially, then complete an ITT, then, if you’re lucky, finally a RFP. In some cases there might then be a round of presentations which will deprive you of even more sleep! As a sales professional it is now more important than ever to be able to show experience of managing such processes and the skills needed at each stage.
These factors have also led to increased competition. Suppliers are expected to produce an ever increasing amount of support materials and are investing a greater amount of time, money and resources to stand out. This means sales people more than ever need to have tendering experience, negotiation skills and show the ability to manage projects.
To further complicate matters things are getting technical! More and more businesses are realising the potential of online auctions in terms of its ability drive down costs and save money. Using online auctions can reduce a company's cost of goods and services by anywhere from 17% to 37%, according to studies by Accenture's Procurement Centre of Excellence in Kensington, London. Clearly as a sales professional selling in the business services sector you need to be aware how they work, the differences between the main player products and most importantly for any future job, be able to demonstrate your knowledge.
The rise of the procurement professional and the general move towards this approach means the skills needed from the sales professional need to evolve. You need to understand they influence procurement has in the buyer group, the various stages and processes and the technology involved. Most importantly if you’re looking for your next sales job, you will be expected to demonstrate your knowledge, show relevant examples and be able to highlight your skills.
What is your experience of dealing with procurement? Has it been difficult? Have you managed to build strong relationships?