Procurement perspectives: managing effectively in the procurement environment

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StephenBauld_100.jpgBy Stephen Bauld

During these difficult times of the pandemic, it can put additional stress on supply chain management in general. Sometimes in procurement, we can be viewed as the "purchasing police" from other organisation members with too many rules and regulations to follow.

From a procurement leadership perspective, attention is usually focused on the ability of a leader to manage people rather than non-human resources. It must be remembered that the management of other resources is essential. A person should not be given authority over people unless they can manage an organisation's tangible and other non-human assets.

In terms of people management, there are various available techniques, each of which is suitable to a specific type of environment. A procurement leader needs to know which method to use for each situation and every person managed.

It is critical at this juncture to differentiate between style and technique.

The basic styles of management most often discussed include:

• The autocratic manager draws on their strength rather than from the strength of others.
• The bureaucratic purchasing manager, who tends to manage by the book, thus purchasing police.
• The democratic manager allows employees to participate in decision-making.
• The idiosyncratic manager adapts their management style to each employee.

These procurement styles should not be confused with the numerous different supply chain management courses available, both in public and private sector organisations.

For instance, the management by objectives school focuses on setting subordinate's achievable goals with the overall goal being to attain the best possible results from available resources. It focuses on the outcome rather than the activity. Managers of this school delegate tasks to their subordinates but doesn't dictate a detailed road map for implementation. Each of the goals so set feeds into the goals that that manager is required to perform.

Another popular school is known as management by walking about. The principles of this school are from the writings of W. Edward Deming, the American business scholar who introduced systematic quality management to Japanese industry. He wrote: "If you wait for people to come to you, you'll only get small problems. You must go and find them. The big problems are where people don't realise they have one in the first place."

I had the extreme honour and pleasure to attend a series of procurement/management lectures from Deming in the early '80s while working as a buyer at Dofasco. He was decades ahead of his time with his philosophical viewpoints on advanced procurement and management methodology.

Under the management by walking about approach, which is not applicable during the pandemic, managers make it part of the general routine to walk through their departments to make them available for impromptu discussions with staff. Such managers seek out discussion with individual employees so that they learn about problems and concerns first-hand. They also communicate their instructions directly to those employees, especially concerning new methods to deal with particular problems.

The third school is known as the balanced scorecard method of management. Managers who adopt this school consider a business (or other organisation) as a system of interrelated strategy factors, owners, investors, management, workers, finance, processes, suppliers, customers and competitors. The goal of the business is to maximise value for all stakeholders by achieving a dynamic balance of their competing values and interests. For instance, it is necessary to balance customer satisfaction with providing a reasonable return on investment.

Stephen Bauld is a government procurement expert and can be reached at swbauld@purchasingci.com. Some of his columns may contain excerpts from The Municipal Procurement Handbook published by Butterworths.

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