I know this appears to be an oxymoron, but competitors do sustain you. Without competitors, there is no validation for your product, your market, and even your existence. But this isn’t a blog about Sales, this is a blog about Procurement. Believe it or not, competitors also help to sustain your Procurement practice. And we’ll get to that, but first we need to discuss the damnation that competitors can be.
Competitors are an outright damnation to the whole organization. Marketing makes an announcement, your competitors try to one up. Sales signs a great customer, your competitors try to weasel into the customer’s good graces through the backdoor. Your R&D makes a great discovery, and here comes the corporate espionage. But from a Procurement point of view, they are also damning.
- They compete for limited supply and drive prices up.
- They compete for limited talent and drive prices up.
- They compete for limited expert (technology) resource time.
Ouch! How can they possibly be a sustentation. Well, this is an example of where when the going gets tough, the tough gets going.
Your Procurement can wallow in self-pity every time the competition scoops up a limited supply at a great price before you, steals the talent you want, or gets the top expert at the systems integrator to work on their project first, or you can recognize that anything they can do you can do better. And here’s where you start.
- Monitor the market constantly, on-line, and in real-time to not only detect the rare occasions when forward auctions get listed (because a competitor went out of business or overbought and has to dump), but to detect events that could impact supply. If a natural disaster wipes out a significant portion of supply, then the market is just going to get tighter and having advance knowledge of the pending crunch can allow you to stock up on inventory early and cut your competitor off, or at least get pre-crunch prices locked in.
- Invest in and understand the talent market, what each generation wants, and put together comprehensive work-life balance packages that will be more attractive than a competitor who merely promises a slightly above market salary (and nothing else).
- Make sure to negotiate up-front sufficient access to any resources you will need, guaranteed milestone dates on the integration project, and penalties for non-performance.
There are other things you can do, but if you start here, you will suffer less supply crunches, attract more talent, and get your projects done on time. And this is a great start.