Procurement Innovation Through a CX Lens

In looking forward to 2021, I am putting New Year’s Resolutions on hold to reflect instead on 2020 lessons learned. Frankly, there is plenty of room for improvement.

In trying to focus on “innovation” during 2020, it became more and more difficult to really define what the term meant. It varied depending on point of view, as I tend to lean towards more efficient ways to execute the procurement function, especially using emerging technologies. This will remain a focus that I will continue in 2021, as I believe we are only scratching the surface of the potential of these tools, and really need to scale and further streamline how these tools can get implemented.

Others in federal leadership saw “innovation” more broadly. For example, I saw leaders claim that reorganizations were innovative, creating matrixed organizations were innovative, and getting expensive consulting support to created roadmaps as a way to drive efficiencies in their respective organizations, as mentioned by an excellent Harvard Business Review (HBR) article, “Why Companies Do “Innovation Theater” Instead of Actual Innovation.”

Many organizations nonetheless are continuing to realize the importance of what true change can be realized in their respective procurement organizations, especially by watching and benchmarking the success the Department of Homeland Security has found through their Procurement Innovation Lab.

However, the approach to how innovation is being executed needs to be improved, and perfectly summarized by the HBR article:

…At the same time, companies and government agencies typically adopt innovation activities (hackathons, design thinking classes, innovation workshops, et al.) that result in innovation theater [emphasis added]. These activities shape and build culture, but they don’t win wars, and they rarely deliver shippable/deployable product…

This disconnect is where I normally see the breakdowns, as a focus on training without a cogent strategy to really understand why these fundamental changes in how federal organizations execute the procurement function are needed and will be executed.

…”Efforts to reform and recast these [processes] are well meaning, but without an overall innovation strategy [emphasis added] it’s like building sandcastles on the beach. The result is process theater…”

So how does one create the innovation strategy?

I argue that innovation is not a standalone endeavor, and should be a central focus for procurement on a more holistic strategy aligned with an overall Customer Experience (CX) approach.

To realize real transformative change, procurement organizations should be developing a CX vision that delivers the desired cultural transformation, which then drives improvements in employee experience within procurement organizations to further drive productivity, positive sentiment, and the desire to innovate.

This evaluation of the CX vision should be end-to-end, and not just solely on the customer service aspect of CX. This is also using the concepts of user-centered design to ensure procurement customers are also having a positive experience with the entirety of the procurement process. This goes from need identification, and all the way to contract execution and beyond.

Procurement organizations need to ensure their customers and employees have the right tools available to them, in an easily accessible fashion, to perform the procurement function. Contracting professionals should be acting as business advisors and educating new customers, as opposed to focusing on documents and just executing contract actions. Further, procurement leaders should have real-time intelligence on the entirety of the procurement landscape to make the best decisions for the mission.

In light of these business practices, I believe one of the best organizations that can be developed in procurement organizations is the project management organization (PMO), or at least a customer-focused organization within procurement to help drive CX. This PMO can help with follow-up, which can be one of the hardest things to happen in procurement.

Following up with vendors on the status of procurements; following up with customers on the status of needs and modifications or recompetes to prevent poor acquisition planning and the inevitable “bridge contracts”; following up with the status of contract actions internally, etc. This is where emerging technologies come into play; using these tools to increase efficiencies for customer actions and improving the overall CX posture. They can be implemented for relatively small investments, but the returns can have direct and large impacts on the mission.

Some would argue that this would be innovative, but I think it is just good business. These items are not expensive, and assuming tools and resources are available, and which leaders should be make available, it creates a culture of engagement and allows for innovation to be part of the process of service delivery. By rewarding and incentivizing these behaviors, employees feel empowered to help the transformation from the bottom-up, which is truly the best way to change.

Procurement organizations may not be able to have the latest technologies available to them at their fingertips like the commercial sector, but to really innovate, you need an organization that is responsive to customers, both internally and externally.

This starts with the simple things, like returning calls and emails, and being proactive. An organization cannot hope to innovative if it is not responsive to customer needs.

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