Like us on Facebook
See the current issue
of The Internationalist magazine
Find out how to sponsor an issue of Trendsetters
Trendsetters: Joanne Davis Discusses Talent, Training, Trust and Transparency as the Role of Global Procurement Shifts
There’s little question that the role of procurement and strategic sourcing within the marketing ecosystem has dramatically evolved in both sophistication and purpose since its beginnings just over a dozen years ago. Now a global phenomenon within multinational organizations large and small, there’s been little information about how this critical corporate function works around the world—until now.
Earlier this month, The Internationalist, as part of The Internationalist 1000 initiative with the ANA and in preparation for the ANA’s annual Advertising Financial Management conference, sent a brief survey to procurement leaders throughout the world. The goal was to better understand current thinking on critical issues pertaining to marketing procurement as it affects global practices and processes. Joanne Davis of Joanne Davis Consulting, as both an Internationalist Board Member and part of the ANA’s Teaching Faculty, helped interpret the results.
After receiving the results from procurement and sourcing executives, The Internationalist then initiated a companion study to international agency management leaders—in an effort to compare thinking and to gauge the growing alliance between the client and agency sides of the business.
Upon review of both surveys, Joanne Davis commented: “Current thinking among both procurement executives and agency leaders boils down to the 4 T’s– Talent, Training, Trust and Transparency.”
Talent. According to Ms. Davis, “Both the client side and agency side said procurement talent development is one of the top three critical issues facing procurement leadership today.” Many procurement departments are continuing to hire or transfer subject matter experts into their divisions. They are more focused now on hiring a marketer to manage marketing procurement, hiring a researcher to lead a procurement category that includes research, or hiring someone with web and digital expertise to work in digital procurement. As one procurement leader commented: “it’s a lot easier to teach procurement to a marketer than marketing to a procurement buyer.”
Training. “Not surprisingly, both clients and agencies listed skill levels of local procurement as one of the greatest challenges when operating on a global basis,” says Joanne Davis. The best procurement leaders are actively involved in training. One respondent said he personally goes to the regions and trains his regional leadership, and then has his regional leaders train local procurement managers. She adds: “This is of course easier for larger-spending companies that can justify dedicated or at least semi-dedicated marketing procurement talent. Yet the smart smaller companies are still devoting time in market. They no longer complain that ‘it costs too much to send a marketing specialist to train local indirect procurement folks.’ Instead, they say, ‘we can’t afford not to.’”
Trust. Any aspect of business that rests on strong personal interaction can be complicated to acknowledge or develop without the test of time. Interestingly, both clients and agencies admitted that they often have a lower level of trust in local markets-- less than they do closer to home. They also recognize that this is an area of critical challenge; while they want partners with the right cultural sensibility and sensitivity, they also want to be sure those partners also understand the best of global governance. Another top challenge cited that relates to issues of trust, or lack thereof, was the complexities surrounding matrix reporting systems.
Transparency. Although a well-used term today, transparency was discussed in this survey as the challenge of transparent practices relating to local and global procurement sharing and stakeholder intelligence. One client leader shared how there were often competing interests. “Local looks at HQ as big brother and doesn’t want to share, while HQ sees local procurement as ‘local buyers’ who have to manage direct and indirect procurement, but don’t know the difference in ‘buying agencies.’” Joanne’s conclusion is that “Such discussions always bring us back to Talent. Putting the right talent in place is often the best solution.”
She also comments: “It was refreshing to hear higher-level strategic views, rather than more talk about savings and cost cutting. However, we heard from the rock stars of procurement who were operating at a top global level. We hope that the junior people in their ranks can learn from their perspectives and experience.”
The Internationalist survey questioned those leading procurement individuals who are concerned about reinventing the discipline and bringing quality and accuracy to this element of marketing. They represented some of the world’s largest global companies in a wide variety of categories – technology, travel, pharmaceuticals, food, energy, consumer goods, and entertainment.
Other brief comments and ideas from the study include:
- The need to hire willing and capable individuals out of Marketing to work in Procurement
- Dedicating face-to-face time with the local procurement leads -- whether at HQ or in their local market. This includes understanding the politics of their markets and how relationships work in their region.
- Including local procurement in all activities so they can experience first-hand how (and why) things like the agency relationships are managed. This helps them gain a better understanding of the nuances in client/agency relationships, which are often very different to traditional buyer/supplier relationships with which they may be more familiar.
- The need for resources to travel to markets for the training of local staff. Also the need to hire consultants for bandwidth and expertise.
- Recognizing that procurement should be brought into discussions and negotiations at an earlier stage. This means working more closely with internal marketing clients-- whether global or regional.
“Perhaps all these ideas are easier said than done,” says Joanne Davis. “Taking a time out and thinking about these issues is crucial. No one wants to pay more, but if we invest in the right talent and training and trust it can happen. When it does, we have seen powerful results.”
Joanne Davis founded Joanne Davis Consulting, Inc. in 2000. The consulting firm specializes in client/agency optimization, search and compensation management, and client internal integrated marketing communications. In early 2006, Joanne Davis Consulting became a shareholding partner in SCAN International, to better service multi-national clients. She is currently SCAN International’s co-President. Joanne’s consulting clients include and have included Exxon Mobil, JP Morgan Chase, Macy’s, Marriott International, Microsoft, Miller Coors, Pernod Ricard, Pfizer.