INTERVIEW / MINISTRY OF BUSINESS, INNOVATION AND EMPLOYMENT
ADVERT / VALUE
Supplier relationship management
Pidcock recognises that it’s not only peers that the procurement profession needs to work more closely with, but also suppliers. He says currently, beyond some activity in the IT space, there is no crown-level engagement of the supply base, no coordinated risk management and work to be done to identify government’s key partners. “The Minister asked ‘who are the top 50 suppliers, who isn’t performing and where’s the risk?’ These weren’t questions we could easily answer. So we started a project to find out. “We took the top 100 common suppliers across government, identified from agency reporting, and carried out a State of Flux ‘Voice of the Supplier’ survey to understand what it is like working with government – the good and bad.” State of Flux has also carried out a diagnostic of current practice and is helping to design the future state of supplier relationship management for the New Zealand government. The next step is for Pidcock and his team to work with State of Flux to undertake a proof of concept with two key suppliers. The purpose is to learn more about the entire government’s connections with those partners – the risks, impact and to consider how they could work better together. Pidcock anticipates this will uncover a number of opportunities – both innovation and unnecessary duplication that could be cut out – and hopes it will quickly progress from a proof of concept to a full-blown cross-government programme with key suppliers. “This whole exercise is about the viability of our profession. If we’re not doing this, if we’re not the owners of that relationship at crown level how can we possibly give the value the profession needs to give in managing outcomes? “Increasingly procurement people get it but don’t do it, it’s our job to make it easier for them to do the right thing. It’s about getting that army the key messages they need so they can communicate the value proposition and do it.” He says procurement should no longer be thought of as a desk job where staff write a procurement plan, carry out a tender, negotiate a contract and walk away. It should be about strategic investment, secondary outcomes and supplier relationship management. “It’s about thinking about what should happen, making it happen, holding people to account and reporting on it,” he says. “New Zealand is full of problem-solving, innovative people and because of our size and scale we should be able to jump forward quite quickly and leapfrog other jurisdictions in making progress, so let’s just do it.”
NEW ZEALAND IS FULL OF PROBLEM-SOLVING, INNOVATIVE PEOPLE AND BECAUSE OF OUR SIZE AND SCALE WE SHOULD BE ABLE TO JUMP FORWARD QUITE QUICKLY AND LEAPFROG OTHER JURISDICTIONS IN MAKING PROGRESS, SO LET’S JUST DO IT.
Are you maximising value from strategic
Standardise data collection and reporting
One suggestion is investment in implementing a government-wide system to standardise data collection and reporting, and to get all departments to work in common ways. “Agencies are attempting to solve the same problems themselves and data is a great example. We all have financial management systems, most of the big departments have a purchase-to-pay bolt on, many have e-sourcing but it is often poorly implemented and utilised and there’s little data standardisation. If we do it once from the centre and do it well – spending the money on implementation, change management and configuration instead of sourcing the same thing multiple times – we would be better able to track and demonstrate policy outcomes as a result of the way we spend,” he says. “New Zealand is pretty tiny, there are only five million people, and we’re innovative and nimble, so this should be achievable within 5-10 years, especially if we work together.” Pidcock has experience of working within the machine of government already having spent almost nine years at the Ministry of Education, the last two as CPO. While responsible for capital builds, including the maintaining of schools, he worked with peers in corrections, transport and housing to ensure they managed markets and suppliers together to boost efficiency and avoid overlaps. They also tried to sequence projects so that, for instance, the building of a housing development was followed by the construction of a school. “Heads of procurement clubbing together like this leads to step-change improvements instead of incremental adjustments. There’s only a couple of thousand of us in procurement across government and everyone knows everyone, so it should be possible for us to quickly create positive change.”
suppliers?
Post pandemic, procurement has an enhanced business mandate to identify, grow and deliver business value. Working with you and your suppliers, we can help you to identify all forms of value and guide you on the best approaches for delivering it in a way that is scalable and repeatable.
enquiries@stateofflux.co.uk srm.stateofflux.co.uk/2021-report
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STATE OF FLUX
2021 GLOBAL SRM RESEARCH REPORT
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