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Tuesday, 15 March 2016

Are you getting the business requirements right?


Is it just me, or does this seem to happen often with teapots? 

Isn't the sole function of a teapot to brew a cup of tea, and then deliver that tea to the cup, without losing any of the water? 

There's lots to be learnt for procurement from this example, and also applied to any purchase an organisation is making - however big or small, and whether buying goods or services. 

After all this new submarine for the Spanish navy was reported to be so heavy it would "sink like a stone".

And Virgin trains's female staff were reported as having to buy non frilly bras, due to the flimsy and see-through nature of the material of their uniform blouse. 

None of these examples are really about getting the right specification either - as I suspect they all complied with the specification. 

The problem seems to be that the purpose for which the items were being put was forgotten, ignored or not tested. That is, the buying process I suspect became more about the cost of obtaining the specified item, rather than whether it would work in practice day to day! 

It's a problem organisations find themselves in often, and it's something that the enlightened buyer will take steps to avoid. 

Steps such as:
  • Having a cross functional team engaged throughout the sourcing process
  • Ensuring the business requirements encompass all aspects of the goods or services not just the specification - eg fitness for purpose, assurance of supply, support required, financial requirements of the supplier, whole life costs, ethics, sustainability, innovation for the future.
  • Identifying key performance indicators for these business requirements - to compare sources of supply, and to measure the successful supplier by
  • Agreeing criteria for selection that encompass all the business requirements - ie not making the decision just about cost
  • Speaking to other buyers of the same goods and services - for references, benchmarking, and to learn from their mistakes and successes 
  • Speaking to customers/end users, and asking what's important to them
  • Checking the credentials of potential suppliers
  • Auditing the manufacturing process and/or testing the goods before going into manufacture
  • Ensuing adequate training is available for end users (perhaps the angle of pouring of the teapot stops the leakage?) 
  • And so on
That is enlightened procurement doesn't just buy the goods or services at the lowest price to meet the stated specification. Enlightened procurement is about obtaining maximum value, and fitness for purpose, over the length of the life of the goods or services.

When did you last buy a dribbly teapot, actually or metaphorically, and what actions will you take to avoid that in the future?

Alison Smith
The Purchasing Coach

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