Training - Contract Management
Let’s be frank – contract management isn’t the most exciting aspect of procurement. After all, who likes paperwork and minutia? Most people don’t. For those in the earlier stage of their career understanding legal jargon can be daunting and negotiating the contract with the supplier, harder still. More experienced professionals might not have even been taught this core skill properly and, with a desire to focus on more exciting activities, try to steer clear of contracts whenever possible.
Robust contracts are a key tool to manage your suppliers and minimise risk. So, like them or loathe them, you need to be good at them. Following some simple steps and with a bit of practice, I’ll show you that contract management isn’t nearly as arduous as you might think.
If you’re a Head of Procurement or Procurement Director you might have different needs. Perhaps you’re unhappy with the low level of spend under contract, the poor accessibility of contracts or that the full contract value isn’t derived. As a Procurement Director I’ve had this challenge myself and have some god ideas of how to help you.
Training - Contract Management
Let’s be frank – contract management isn’t the most exciting aspect of procurement. After all, who likes paperwork and minutia? Most people don’t. For those in the earlier stage of their career understanding legal jargon can be daunting and negotiating the contract with the supplier, harder still. More experienced professionals might not have even been taught this core skill properly and, with a desire to focus on more exciting activities, try to steer clear of contracts whenever possible.
Robust contracts are a key tool to manage your suppliers and minimise risk. So, like them or loathe them, you need to be good at them. Following some simple steps and with a bit of practice, I’ll show you that contract management isn’t nearly as arduous as you might think.
If you’re a Head of Procurement or Procurement Director you might have different needs. Perhaps you’re unhappy with the low level of spend under contract, the poor accessibility of contracts or that the full contract value isn’t derived. As a Procurement Director I’ve had this challenge myself and have some god ideas of how to help you.
Course Prospectus
Amanda Winterflood
Procurement Adventurer®
What was the catalyst for your career in procurement?
I grew up in the US where the education system is a little different to the UK. Rather than select a handful of A-Levels we got to choose a range of modules on top of our core subjects. In my last 2 years of school I chose Principles of Industrial Purchasing. I was then fortunate to land a place at Michigan State University which has one of the best courses for Supply Chain Management.
It transpired to be a brilliant course. It was heavily biased towards projects over exams giving me loads of great experience. Of the internships I did, one really stood out:
I headed down to Iowa to work at John Deere where my project was to look at Supplier Diversity. The US Government and consumers want to ensure that the supply base reflects the population and measure how many suppliers are owned by Women, Minorities, Veterans, etc. and my job was to prepare for an upcoming audit.
On an aside, if a customer bought a combine harvester from John Deere they got to be the first one to turn key. And customers could have a tour of the factory by retired John Deer employees – it was terrific to see the pride they took in their work.
Being bought up in the US, how did you come to work in the UK?
My third internship in college was as a line supervisor for General Electric. I valued the experience of working front-line in a union plant, but I realised I didn’t want to end up as a plant manager. Given the challenges in the automotive industry (GM, Ford, Chrysler) the job market around the Great Lakes was tough in 2010. So, I opted for consulting starting as a Sourcing Analyst for Kearney in Chicago. One of my favourite projects was maximising value for a US defence supplier. We did this through the maxim that costs should decrease the further the supplier progresses along the learning curve.
Being a global business, Kearney gave me the opportunity to work in Sydney. I met my (English) partner whilst working there and, in time, this led us re-locating to the UK.
"Cost should decrease, the further along the learning curve"
"If you can't explain it simply, you don't understand it well enough"
What is the best skill you are currently utilising?
One of my favourite skills is a soft one, not actually specific to Procurement – it’s how to tell a story and structure a presentation. Afterall, what good is a robust proposal if it doesn’t engage the audience? My top tips are:
Start on paper, not PowerPoint – know what you want to say first. Create a story board.
Utilise Einstein’s quote – “If you can't explain it simply, you don't understand it well enough.”
It’s your job to help the audience understand your content and message, not theirs. If they can’t understand it, it’s down to you for not making it clear.
What is the style of procurement at Hotel Chocolat?
Our approach is ‘procurement for growth and good’. We work hard to develop partnerships that deliver a good financial impact for Hotel Chocolat but also a good social and environmental impact.
How do you contrast direct vs indirect procurement?
The biggest difference about indirect spend is that there’s an even greater focus on demand management and challenging the spec. For example, for energy, we work hard to reduce consumption. For facilities getting the right frequency of cleaning is key. And for travel, having a robust policy makes all the difference.
"We should be out and about with suppliers much more"
My crystal ball for procurement in 20 years is...
Whilst procurement is developing, I feel there will be an ever-widening gap between the leaders and the laggers. I sense leaders will spend more time with their suppliers. A typical procurement professional might spend the equivalent of four days internally focused and one day with suppliers. We should be out and about at least two to three times this ratio.
Tell us about your current role...
Seven months ago, I started an exciting role at Hotel Chocolat as Head of Great Procurement Experience and Indirects. Previously, Hotel Chocolat never had a formal Indirect Procurement Function – each team just bought their own products or services. As I’ve shaped my new role, I’ve majored on getting two things right with my stakeholders – approachability and competence. Competence requires me to demonstrate subject matter expertise and challenge the norm when appropriate. As an example, we’ve transformed the way we buy energy with a new hedging mechanism – I was impressed that our COO and CFO took the time to listen to my ideas and shape the solution.
With the wider group, I need to select and share useful tools & techniques and help them utilise them for their budgets so that we can professionalise as a group how we procure things.
As the title of my role suggests, we want everyone who works with our procurement team to find it a motivating experience that really helps them see the value of procurement.
What can the UK learn from how procurement is studied in the US?
In the US the collaboration between universities and business is much closer. Companies help shape the university courses so they’re really in tune and up-to-date with the needs of the workplace. Businesses are also much better at promoting what they do and what opportunities there are for graduates so I already had a good sense of what Procurement was before graduating.
"In the US the collaboration between universities and business is much closer"
Which areas of sustainable procurement most matter at Hotel Chocolat?
Currently our main area of focus is our Gentle Farming Cocoa initiative where we pay our growers a premium for their cocoa and pay for their trees to be pruned generating a better crop. The programme is very rich in content and ambition, come and ask me for more details! Additionally, working towards 100% recyclable packaging is another focus area for us.
"I'm a stickler for deadlines!"
Which skill do you most value from your time as a consultant?
Three skills learnt from consultancy have since stood me in really good stead. The first is how to think logically through a problem. Such as taking a category from the beginning and working it through the strategic sourcing process. Becoming highly competent at PowerPoint and Excel would be the second. And the third would be how to manage challenging stakeholders. On this last point, I’m a stickler for deadlines! Never put yourself on the backfoot by missing a deadline.
How can we tell the procurement story better?
We need to promote the value of our results much better. Eg what’s the required additional sales to generate the same profit as the savings we deliver to the bottom line? I’ve used an example recently of extending supplier payment terms by 30 days for every £5k of spend is the equivalent to having to sell 33 more big boxes of chocolate.
Bringing the 7-Step Sourcing Process to life really matters too – we need to show our stakeholders how it works using simple language and being clear on how we add value at each step.
What makes you tick outside work?
We’re lucky to have two amazing children – our daughter who’s 3 and son who’s 18 months. This keeps me pretty busy. I like a match of tennis too and in the evening I zone out with a bit of cross stitch – great to keep me off my phone! Recently I completed a light house.
Rapid fire
White, milk or dark chocolate?
All three! And I love our peppermint chocolates
Hot chocolate or espresso coffee?
Espresso
Australian Bush or African Savanna?
Australian Bush - I had a great trip to Uluru
"I holler out - Second Serve!"
I recently rediscovered...
Tennis. My friends laugh at me when I play as if I miss my first serve, I holler out, “Second Serve!”. That’s the etiquette in The States – you have to state “Second Serve” where that is not done here…
Which place means most to you?
Part of my heart will always be where I grew up in Michigan. Sydney was a great adventure as it was my first time moving abroad. And we love the area around Lake Annecy, France for the swimming, cycling and hiking.
Where do you get your inspiration from?
Seeing the accomplishments of those ahead of one and the raw energy of those earlier in their careers.