[vc_row][vc_column][vc_column_text]
For some months, at the meetings we have had with managers of companies across different sectors it has become increasingly common for them to tell us that their Steering Committees are in favor of adopting policies that, without casting aside cost containment, are more focused on supporting sales growth.
And this new scenario affects Purchasing Departments, which are suddenly in the midst of, on one hand, cost-saving strategies that the companies have managed to employ during the years of the crisis, and on the other hand, medium and long term investments. The CEOs of these companies ask their CPOs to support these policies, in order to make the companies even more competitive.
During the harsh months of the recession, Marketing Departments have “suffered” visits from the CPOs, as this has historically always been an area where large budgets are managed, and where there are services often based on poorly quantified data and a low implementation of purchasing procedures.
you can manage only what you are able to measure
Here I would like to emphasize the importance of “measuring”.One of the concepts that we always explain to our junior consultants during their first few days of training is that which says “you can manage only what you are able to measure “, and this is especially true of the Marketing area.
Throughout our experiences on projects we have tackled with different Marketing Depts., we have understood that the main providers (the agencies) already know that purchasing managers are seeking to make those savings, and they play with the budget so that, in the end, by rearranging their budget lines, the numbers are positive, while still managing to reach a customer who is happy because they have managed to get a “deal”.
we should focus on the value they will bring to the company, which will allow us to negotiate the costs in function of this created value
And we believe that we should focus on the value they will bring to the company, which will allow us to negotiate the costs in function of this created “value”. This change of concept is not simple, but providers understand that they are not being talked to about fees but they are recognized for what they bring to their customer’s business, and this causes a better result in negotiations and subsequent relationships between customers and providers.
Therefore we are strong advocates for the involvement of the Purchasing Department across the entire Marketing Department, but it is very important to make an effort to understand what the “value” of the service or product is for them. That way everyone will be speaking the same language and the results will certainly be up to what is required.
[/vc_column_text][/vc_column][/vc_row]
