Although we\u2019ve already written much on dividing procurement departments into tactical and strategic teams, it is worth discussing other potential ways to slice the procurement activity pie.<\/p>\n
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In most procurement departments that are split into tactical and strategic teams, the tactical work includes order placement, expediting, and resolving day-to-day issues. \u00a0And the strategic work includes sourcing, negotiation, and supplier management.<\/p>\n
As procurement has continued to mature and better talent has been comprising a higher percentage of our profession\u2019s workforce, strategic sourcing and challenging negotiations aren\u2019t reserved for only the top handful of performers in a procurement department. \u00a0Almost everyone who occupies a professional procurement role does these things. \u00a0And the available procurement training and technology enables these people to do a good job at it.<\/p>\n
However, strategic sourcing and negotiation still can\u2019t be classified as \u201ctactical\u201d on the same level as cutting PO\u2019s.<\/p>\n
But collaborating with suppliers and creating value from supplier relationships is even further from tactical purchasing. \u00a0So, should we reevaluate how procurement departments are divided? \u00a0And, if so, how might we divide them?<\/p>\n
Well, let\u2019s take a look at how some sales organizations divide themselves.<\/p>\n
Sales organizations can be divided in multiple ways. \u00a0One common way is by geography: \u00a0all sales reps do the same job, just for different customers in different regions.<\/p>\n
However, an alternative division \u2013 or a subdivision of that existing division \u2013 is where a sales organization is divided into two groups: \u00a0\u201chunters\u201d and \u201cfarmers.\u201d \u00a0The hunters are those that approach potential new customers, negotiate with them, and ultimately close deals with them. \u00a0The farmers don\u2019t do that. \u00a0They take over accounts won by the hunters, maintain the relationships, make sure customer needs are met, and aim to gain and grow recurring business.<\/p>\n
Why does this split make sense?<\/p>\n
Well, it takes different skill sets to perform each role. \u00a0And it takes different personalities for each role \u2013 personalities that are perfect for one role are \u00a0poor for the other.<\/p>\n
Hunters love the feeling of \u201cwinning.\u201d \u00a0It\u2019s a feeling that is addicting and drives hunters to recapture that feeling as often as possible. \u00a0It motivates them to be the first one to arrive at the office, be the last one to leave the office, and make more phone calls than any of their peers. \u00a0Because they \u201cexist to win,\u201d the farming role isn\u2019t exciting to them. \u00a0And that lack of excitement usually means that they won\u2019t voluntarily spend their time farming.<\/p>\n
But farming is needed. \u00a0And good farmers have the perfect personality for that role. \u00a0They know how to relate well to people. \u00a0They are able to have conversations that both parties enjoy. \u00a0And they are good at making sure things don\u2019t\u00a0fall through the proverbial cracks. \u00a0But they just don\u2019t have the fire in their bellies to pound the phones and tirelessly chase new business, which they can find demoralizing when it doesn\u2019t go well.<\/p>\n
The hunter\/farmer division works great in sales. \u00a0It leverages personality types.<\/p>\n
Could a hunter\/farmer division work equally well in procurement?<\/p>\n
I think so.<\/p>\n
Tenacious procurement negotiation requires a different personality than\u00a0leading a mutual cost reduction project with a supplier. \u00a0As more procurement organizations discover how they can create value beyond traditional sourcing and negotiation applications, a new personality type will be in increasing demand in procurement.<\/p>\n
I know that some procurement organizations are already splitting activity in a hunter\/farmer type of approach, though they aren\u2019t calling it that. \u00a0And I think that any procurement transformation going forward should consider leveraging this alternative approach to dividing procurement responsibilities.<\/p>\n","protected":false},"excerpt":{"rendered":"
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