The ultimate measure of what we do is the stakeholder satisfaction. The subject is much wider and more complex than you could think. And very frequently it is underestimated in importance. Try to think about aligning your demanding boss’s expectations to devote as many hours for work per week as possible to the expectations from your partner to spend more time at home. Difficult, right? Now multiply that several times to reflect every day business situations. It starts looking like one of the Fermi questions: divide the price of a Nike men’s Dual Fusion sneaker by the price of Burj Khalifa, for instance. Don’t worry, you are not alone – I do not know the answer, either.
Delighting, Performing, Fulfilling basic needs
Searching for ways to evaluate and prioritize areas of focus, I came across Kano model. You can find detailed explanations about it here. To sum up, Mr. Noriaki Kano was studying customer satisfaction and realized, that the features (of a system, a product, or a solution – any deliverable you are working on) have different reactions from the customers (or stakeholders, in our case). Some of them deserved bland “meh” reactions, while the others got stakeholders excited. Kano model divides all factors into “basic needs”, “delighters” and “performance needs”. It is relatively self explanatory, as per the picture below.
Think about all of the reports and slide decks you are preparing. What do you think your manager and other people around you think about quality and the quantity of the report slides? If you report nothing at all, most likely people will not be happy. But when it comes to the question of how many slides you prepare – do you really think, that getting a deck with 64 slides instead of 5, will make your manager much more satisfied? Think again. However, if we are talking about the quality (yes, I know, a very subjective topic), it works slightly differently. All the things you can improve, will add to the end result – satisfaction. And, any level of over delivery, which is perceived as adding value, will have much bigger impact on satisfaction.
So what do you do to delight the stakeholders, keep them happy and make sure you are not messing up by forgetting the simple things? Continue reading…
1. Understand the needs. I mean real needs. Ask “why?” several times. Do not settle for mere “because” or more sophisticated “because I said so”. “We need to increase compliance to Preferred Supplier List”. Why? “Because it increases benefits to our company”. How? “Because we get rebates from companies on our PSL.” (my personal opinion about rebates is here). So is the main purpose to get benefits for the company, right? Would it be OK to get them in other ways? “No.” Why? “Because then those benefits would not be allocated to our department and our performance is measured on that”. What if the goals and objectives were reviewed to represent proper focus and motivation? “Then I agree with everything you are proposing.” This was a real conversation. Two conclusions can be made. One – the system of setting company and personal goals and objectives needs to be reviewed. Two – the real need is to deliver benefits to the company, and not to comply to PSL whatever the cost.
2. Understand the type of the need. Once the needs are identified, you need to understand how they will influence stakeholder satisfaction. The example with report slides is mentioned in the text above. It is important to understand the business you are in. Consider savings. In many occasions, you would think, that it is a linear progression. The more you deliver, the happier the stakeholders. Not always. Think about long term contracts where you have to deliver a certain percentage of savings year-on-year. This will motivate procurement managers not to do their best in year one – because they will under-perform during all further years. And if you add gain-share / pain-share models, it gets even more complicated. Imagine your savings target is £1m and if you do not deliver it, you get penalties of the size of annual management fee. That becomes your “basic needs” curve. You have to deliver one million – whatever it takes. But you can’t really care less about everything over it. If you are using gain share model with a cut-off line at the same £1m, after which you get 50% of savings, you will do your best to hit your maximum best, but everything above the threshold will make your CFO your best mate.
3. Make sure you deal with basic needs consistently. Deal with those tasks quickly to remove them out of your way to focus on really important things. Do not waste additional effort on them – they do not bring additional satisfaction. However, you cannot leave them to be finished last – because not delivering on them will mean failure overall. Are you a contractor? Do you need to submit time sheets and invoices weekly? It’s thirty minutes and a bit of discipline to do it on time every time. Or else – payments will not be made, they will be delayed or / and you will have additional headaches to bring everything back in order.
4. Work hard on performance needs. This is the part which earns your bread and butter. This is where you know that everything you put in, will come back to you.
5. Always find some time for tasks that are not on your job description. Study. Improve. Do a favor for a colleague in need. Speak up during the meeting, if you think (or even have evidence) your opinion would make the difference. Those are your real investments into your future. Everything you do, you do it for yourself. Remember this and those few extra hours a week trying to learn endless boring 6sigma formulas will no longer seem wasted. Ehrm… I am just trying to convince myself here. But you get the point.
Hope this helps to understand why the same effort you put into different things is perceived differently. It’s Friday (as usual; I like posting on Fridays). And today’s list is simple: A. as a minimum, not to forget to collect my kid from the school (I will surely be in trouble if I do not do that); B. Cook Friday dinner for the family (it’s what we do); C. Open cold beer and switch on (and…leave it on) football match for my partner. That should guarantee some brownie points 🙂 Thank you for reading!
Strategy is about knowing where you are now, defining, where you want to get to (by the way, according to the definition of the strategy, it really has to be a better place) and deciding how you will achieve it. As you can see per the very informative map to the right of the text, there are a lot of things to think about when you are planning your journey. Thankfully, in business, there still are things you can plan. Procurement is no exception.
FuturePrOofitable 