I doubt there is any consultancy, large or small with someone in it who hasn’t experienced the sinking feeling when a request for information or a procurement letter drops on the desk or hits the e-mail system. It’s that double-edged sword: great that we’re being considered for the particular project or programme, but mixed with that feeling of dread about what we’re going to have to go through just to get to first base.
But why should we be surprised? As a good friend of mine who looks after the purchasing for a well-known shoe manufacturer put it, ‘I’m just amazed you creative lot got away with it for as long as you did.’
You only need to look at the ad agencies to understand that when clients started questioning the ‘traditional’ way of billing, the ones that adapted to the way clients wanted to work survived. They built the sort of relationship the clients wanted. And those that didn’t, well, to be frank, there are a good few that are not around any more.
So, the issue is not if puchasing processes will happen, or even when they will happen, but what do we need to do as an industry and as individual organisations to make sure the procurement process is a natural and logical way of working.
What we have here is not the threat that many people perceive it to be. Rather, it is an opportunity to not only do business more professionally, but instil in our clients a genuine understanding of how great relationships are built on win-win situations.
Of course, it does mean that we need to be prepared. In my experience, there are too many consultancies that forget they are setting up a design business first and foremost. Only by being professional in business are we going to be able to do what so many of us profess to be in business for – to produce stunning design solutions. It’s easy for someone from a group the size of Enterprise IG to say all this, I hear you say, but I genuinely believe there are some fundamental principles we can all bring to the procurement process, whatever size or discipline we are. Remember, the procurement team on the other side of the table are human beings too. No matter how much you hate the process or despise their apparent lack of understanding of design and the design process, we have to understand that they are just doing their job. So it can be shoe leather or soap powder one day, stunning design solutions the next.
Also, recognise that they are simply going through a process – something that they’ve been trained to do and are usually very good at. Understanding where you are in that process is essential. It means you know the sort of response that is expected.
It is important to be absolutely clear and open from the beginning about what each party is trying to achieve. The best solution is a mutually beneficial one. Although it might seem that they are trying to put you out of business it’s in their interest for this to be a mutually profitable relationship. Asking the two questions: what do you think you are buying, and what exactly is it that we are selling is not a bad start.
Take the emotion out of it if you possibly can. If you’ve got a terrier-like finance person, send them into the fray. They can be much more objective about where the compromises make sense, or not.
Be flexible – one model doesn’t fit all and it’s often a good idea to suggest alternative ways of coming to an agreement. In fact, this is often a good way to get the upper hand in the process.
Information is power: if you don’t know your stuff you’ll be on the back foot from the off. So spend time preparing for the meetings and think through the options carefully. And never give anything away without getting something back in return.
Try to build a relationship and ask for reviews of the arrangement. Getting the procurement teams to better understand your business can only be good in the long term.
Remember to be confident. Don’t forget, we’re selling a piece of magic that can help transform the performance of the client’s company, service or product. Think about introducing some sort of performance-related measure into the equation. I can think of no better measure than design effectiveness.
And finally, never forget that the ultimate relationship is with your direct day-to-day client. They want to work with you, or you wouldn’t be there in the first place.
How to bargain with clients
Understand where you fit in to the scheme of the procurement process
Be clear and open from the beginning about what you are trying to achieve
Clients know it is in their interest for the consultancy to be profitable
Consider alternative ways of coming to an agreement
Bargain – don’t give anything away for nothing
Don’t forget the client’s procurement team are human beings too
John Mathers is UK chief executive of Enterprise IG and president of the Design Business Association