--- To enhance the value and performance of procurement and SCM practitioners and their organizations worldwide ---



We Have the Technology - Building the Perfect Supply Manager

Author(s):

Peter Stannack
Peter Stannack MSc. Director, Performance Sourcing Ltd Ashington Northumberland UK 0 -44-1670 -815258, stannack@stannack.demon.co.uk
Gyöngyi Vörösmarty
Gyöngyi Vörösmarty MSC, Assistant Professor, udapest University of Economic Sciences Budapest, Hungary, 1053, 36-1-117-29-59, vorosmarty@mercur.bke.hu

83rd Annual International Conference Proceedings - 1998 

Abstract. The training of purchasing managers and purchasing professionals might be said to be core to the position of the discipline itself. In a world where purchasing is allegedly becoming a 'strategic' discipline the question remains, with regard to what skills purchasing practitioners can and need to develop and what blockages may prevent that development. The paper argues that purchasing skills training programmes must recognise the role of the purchasing professional within an organisation as a critical factor in the skills acquisition process. Without considering role, training is likely to be ineffective. The paper seeks to develop a model of training which is transferable, robust and perceived as relevant by employers.

Background. This paper describes a piece of action research which was built around the development of skills for a group of purchasing staff and purchasing managers in a large utility company.

The position of the purchasing department within the company was such that it was felt that the staff needed to retrain as part of an overall restructuring of the organisation. Formerly, the purchasing department had been central to the overall strategy of the company. This had been reflected by the presence of three board level appointments and over 1500 staff being involved in specialist purchasing. Over two years, the purchasing function had been delegated to engineers and the specialist purchasing function had dropped to 173. Purchasing held no positions at board level. The purchasing department of the company was broken up into several distinct groupings at central (3), area (4) and district (34) level. Communication between these different groups was seen as poor.

The remit of the programme was to identify those skills which would assist purchasing staff in:

a. Improving their integration within the company

b. Managing their role as integrators of supply across the whole of the supply chain

The first practical step in designing any training programme should be to decide exactly what it is that the teacher proposes to 'teach'. One respondent interviewed during the course of the research stated that: "Purchasing is a pseudo-discipline that disguises it's uncertainties in statistical mists as it battens on the narrow information gap between accountancy and operations management"

Purchasing management development suffers to a degree because there is no generally accepted body of knowledge, skills and attitudes which are seen as exclusively the prerogative of purchasing managers. Problem solving decision making etc. are actions and skills within the public domain. Even financial management and budgetary control is carried out by non managers. This is in stark contrast to that body of professional knowledge owned by doctors or even lawyers. Torstendahl et al [1993] have noted the growth of professionalisation where knowledge is used a resource to gain professional power .

There is, of course, a large amount of literature which outlines the skills needed by managers in general. We can in this group identify writers such as Stewart [1967, 1991], Mintzberg [1975], Boyatzis [1982] and Katz [1974]. These range from managerial functions such as those identified by Mintzberg in his interpersonal, informational, and decisional role groups to those identified by Cameron and Whetton [1991] which include self awareness, managing personal stress, creative problem solving, establishing supportive communication, improving employee performance, effective delegation, gaining power and influence, managing conflict and improving group decision making. We can expect that this type of skills will overlap in purchasing management skills.

We can also identify the shortcomings of skills training alone (Alvesson and Willmot, 1996) and suggest that skills training is only part of an overall definition of role. The concept of role was one which became popular in the 1950's as a model or metaphor for explaining individual behaviour in the wider group. Mangham and Overingham [1988] later introduced the idea of role into organisational life as a method of obtaining a more effective explanation of the way in which individuals interact. Role within organisations might be seen to have three components

* Interaction with task (of which skills are clearly an important element)

* Interaction with colleagues and other actors in the organisation and outside it's boundaries

* Interaction with an individuals 'script' (Johnson Laird, 1986) or historical experience

In designing the programme which arose from this research, we attempted to bring each of these elements into play.

Skills Identification. The first part of this research consisted of a training needs analysis (TNA). This was carried out in three stages. The first consisted of group and individual interviews with a range of senior purchasing staff within the organisation to consider the self perceived needs of the potential programme participants. The second stage consisted of individual interviews with purchasing users and non purchasing managers (of purchasing staff and managers) within the organisation. The third stage consisted of a literature review.

Interviews with Purchasing Staff. In considering the interviews with staff, we were driven by the need to produce relevant skills in order to meet the third criteria identified above.

Element One - Information Management

Problem solving, decision making and planning, acquisition (including developing empathic skills), analysis and interpretation. Probability, creativity

Element Two - Relationship Management

Leadership theory, presentation and marketing, managing change, communication (including negotiation and conflict management) service quality

Element Three. - Staff Management

Appraisal, performance management, team building, and group process

Element Four - Technical Skills

Contracting Specification Writing i.e. help in drafting specifications, statements of needs etc.

Contract Design i.e. expert help and advice with regard to drafting contract terms etc.

Contract Administration i.e. Writing of invitations to tender (ITTs), development of selection criteria, advice with regard to selection processes Negotiation Supplier intelligence gathering prior to negotiation Precontract negotiation advice and service Post contract negotiation advice and service

Claims adjustment Contract Management inc. Sourcing intelligence i.e. market trends, availability, price forecasting etc.Supplier monitoring Supplier performance analysis i.e. audit and identification of potential supply problems.Supplier performance expediting i.e. chasing solutions to or avoiding delivery, cost, quality problems. Supplier development Cost Reduction Cost identification i.e. process mapping, value analysis Planned cost management over the life of the contract i.e. value engineering; Supply aggregation i.e. creating supplier alliances in particular product groups Materials standardisation; Risk Management including Supplier assessment and report; Supply market assessment and report;Situational assessment and report Systems Design and Strategic Planning

Development of sourcing strategy

Procurement systems consultancy

Operational procedures design

Cross business or function purchasing co-ordination

Internal Consultancy i.e.Cross - disciplinary team building for major project teamsConflict management and alternative dispute resolution for contract dispute

Procurement training i.e. negotiation skills, inventory management, procurement best practice

Legislative and regulatory compliance training i.e. EU legislation Materials requirements reviews i.e. reviews involving product or process standardisation

Inventory management consultancy i.e. systems design for inventory management, inventory management training

Provision of methods and tools for cost - effective management of suppliers i.e. assessment methods

Interviews with Non Purchasing Managers and Users

Roles. One of the problems identified by non purchasing specialist managers of purchasing staff was that of role defense. Many of the managers to whom we spoke complained of the fact that purchasing staff deliberately obfuscated their role by making the contracting or purchasing process too complicated

The second part of the research drew on Goffmans (1957) concept of role. We would suggest that self perceptions of role will impact upon the way in which skills are acquired. This hypothesis was tested by establishing self and other concepts of role and considering how role impacted upon skills acquisition. It was possible, using qualitative interview techniques to identify four common strategies in managing role change within the organisation. These strategies are labelled on the basis of Miles and Snow's [1978] typology of strategic change in firms.

The first of role type were Defenders. Defenders tended to fight new developments in the field, and stick to their role as traditional purchasers. They placed a heavy reliance upon 'traditional' activities such as quality or ability to use market knowledge with the consequence that their users often felt disempowered. The skills which supported these activities were described as being 'common sense' or information gathering. Technical and commercial skills such as negotiation were also ranked highly, although definitions of negotiation were often limited.

The second group were labeled Prospectors who actively pursued and introduced new strategies ranging from process mapping through to supplier development. This group placed a heavy emphasis upon the benefits of new types of activity such as supplier development. They saw their role as to bring change to the companies purchasing practices. The highest ranking skills which supported these activities were interpersonal such as influencing and 'manipulation'. Technical and commercial skills ranked lower in this group. Users often felt that it was hard to keep up with prospectors.

The third group were labeled Analysers. This group tended to adopt a 'wait and see' approach. In terms of role they would tend to become involved in activities which had been shown to be effective. These included, active market management in what was a very mature market, and in which many suppliers were dependent upon the companies purchasing activities for continued existence. They tended to rely on their integration with other professional groups to manage their position. This integration was held to be very effective by both purchasing and non purchasing staff. The Analyser groups had also made most impact upon the organisation with up to 30% cost savings in certain markets. Information gathering, analysis and interpretation were seen as the most important skills by this group. Analysers seemed to inspire confidence in their users.

The final group were labeled Reactors. Reactors tended to ignore their environment. Their role perceptions were that they were not valued by the company. This led them to concentrate on administrative activities. In managing these activities, the skills which they saw as being useful were largely technical in the form of report writing, and company specific skills such as managing the order processing system. Reactors were largely ignored by users.

Looking at the Literature. We have seen that the interaction of role and skills will impact upon training effectiveness. The third part of the research considered how role change could be managed using trainable skill and knowledge acquisition strategies.

Annet and Sparrow [1985] propose an information processing theory of skill transfer in which a skill is specified as a complex pattern of behaviour controlled by a schema or plan which dictate its use in particular situations. Annet suggests that;

"When detailed skills are not readily transferred from one situation to another, this is an indication that they are not under the control of the plan which is currently in operation....This theory of transfer, then, leads to a different prescription of what to do to encourage transfer and that it to identify the higher level skills which should be controlling behaviour and to teach these in such a way that they incorporate a set of appropriate and, if necessary, varied specific skill components"

Nisbet and Shucksmith [1991] use a sporting analogy to highlight the difference between meta-cognitive and lower order skills by describing the situation of a soccer team and its trainer. Individual players need to practice many skills - heading, dribbling, ball control and so on. Prior to a soccer match, groups of players may plan certain tactics or strategies which involve the selection, sequencing and co-ordination of skills for a particular purpose.

Sternberg et al [1981] build on this model by analysing intelligent performance into a number of component processes;

1. Executive skills which are higher level skills used for decision making, planning monitoring and evaluating etc.

2. Lower order components which are sub divided into

a. Performance components which carry out the steps and procedures selected by the meta-components. These may include combinant skills or comparison skills. [analysis and synthesis]

b. Acquisition components which involve learning new information

c. Retention components which involve the retrieval of information

d. Transfer components which involve carrying information from one context to another.

Nisbet and Shucksmith [1991] then take the argument further by asking what would happen when the selected strategy does not work. The poor team might continue with the same tactics, irrespective of the outcome. A good team would be able to monitor and assess the situation to achieve the desired goals. It does not matter how efficient the individual players are at tackling and running if they cannot co-ordinate them into useful strategies.

The type of skills which might co-ordinate the individual skill components can be labeled 'critical learning' in that they could help learners to acquire and critically appraise information in their working environments. Critical learning is not entirely a new phenomena. Others have written on similar subjects and indeed the core skills debate together with that on appropriate workplace learning. Darrah, (1991) touches on this.

We can identify certain characteristics of critical learning.

* The first of these is that critical learning is problem focused learning. It is a pragmatic exercise which involves practical problem solving.

* The second is that critical learning is a process not an event. Critical learning is constantly developing new ways of thinking and challenging assumptions.

* The third is that critical learning is a contextual activity which will change and develop according to the environment in which it is carried out.

* The fourth is that critical learning involves learning cognitive, conative and affective domains - what the critical learner thinks, feels and does. This became particularly important when we considered the question of empathy as an important component of information gathering skill (Davis 1994).

Essentially, we can say that critical learning is the ability to treat information critically. This may be seen as a vital component of operating in a data rich environment and in managing role shift. Critical learning skills may include memory training, comprehension, reading complex text, understanding inference and implication (use of concept maps) and argumentation analysis.

The next stage in the programme was to design the delivery and evaluation process through which the content would be delivered in such a way as to maximise the participants acquisition of both purchasing and critical learning skills. Space limits prevent our dealing in great detail with the way in which the critical learning elements of the programme and the other elements of the programme were integrated.

Putting it All Together. We have seen that there are a number of factors involved in the design of any training programme which might be said to correspond to content and process. In order to maximise the effectiveness of the programme it was necessary to ensure that the content issues with regard to curriculum design etc. were integrated with process issues such as learning styles and methods. Other factors to included, social learning factors, teaching capacity and teaching styles, and environmental factors to ensure that the best possible outcomes were achieved. The criteria used to assess programme effectiveness included i.e. relevance, time efficiency, flexibility, cost, non judgement and transparency for the learner together with transferability, 'deliverability' and assessability for the programme designer and professionals involved. This meant that any programme aimed at teaching core purchasing skills would also involve a component or element in training for critical learning. The programme itself would also need to be designed to facilitate learning skills.

Conclusion. Rather than concentrating on the skills required for purchasing education, which has been dealt with extensively elsewhere (Kolchin and Giunipero 1993) we sought to consider the process at a somewhat more 'strategic level'. This meant that we wished to consider the way in which the interaction of skill and role could be made to enhance, rather than limit purchasing skills acquisition within an organisation.

We can suggest that any purchasing training programme design will require consideration of role issues in order to be effective. We can also suggest that the introduction of a 'critical learning' element into programme design can enhance acquisition skills and development rates. Although a comprehensive evaluation of the programme has not, at the time of writing taken place, initial results are promising. The identification of the skills and roles which were part of this programme have proved to be a useful exercise in considering the way in which the purchasing profession may develop, and the blockages which may prevent that development.

REFERENCES

Alvesson and Willmot, 1996 Management Learning SAGE CA.

Annet and Sparrow 1985 The Structure of Memory and the Art of Learning London Harvail Press

Boyatzis 1982 The Competent Manager n.p.

Darrah, 1991 Workplace Learning Journal of Organisational Studies Fall pp262 -273

Goffman 1957 The Presentation of Self in Everyday Life Penguin Harmondsworth UK

Johnson Laird, and Wason1986 Psychology of Reasoning Structure and Content Harvard University Press Cambridge MA

Katz (1974) The Social Psychology of Organizations John Wiley New York

Kolchin and Giunipero 1993 Purchasing Education and Training Requirements and Resources CAPS

Mangham and Overingham, 1988 Organisations as Theatre John Wiley Chichester UK

Miles and Snow 1978 Organisational Strategy Structure and Processes McGraw Hill New York

Mintzberg 1973 The Nature of Managerial Work Prentice Hall Eaglewood Cliffs NJ

Nisbet and Shucksmith 1991 Human Inference Strategies and Shortcomings of Social Judgement Theory Prentice Hall Eaglewood Cliffs NJ

Sternberg, Conway, Ketron and Bernstein 1981 People's Concept of Intelligence Journal of Personality and Social Psychology 41 37-55

Torstendahl et al 1993 The Future of the Professions SAGE CA


Back to Top