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Partnerships or Competition?

Competition, taking sides, winners and losers or true partners taking things forward for common good? My thoughts on this started off from work I’m doing for a client where we have some EU competition issues, and then I read a tweet from Cathy Hayward where someone had mentioned the reaction of their purchasing team to talk of partnerships.

I’m often labelled as a Purchasing Expert, but it is just one thing that I have experience of. I see myself more as a businessman who has, over the years variously been John the Buyer, John the Salesman and finally John the Operations guy trying to deliver what the Sales people have sold with what the Buying people have bought for me. It ain’t easy, believe me, but I’ve made a decent living along the way and had a lot of fun.

One of the things that can hold a business back is functions not getting on, so let’s look at the three tribes:

Purchasing people tend to thrive on the competitive element of their profession. Keeping the market on its toes and keeping their pencils sharp so that the best deals are struck. Shaking up the mix is what it’s all about.

Operations people prefer an element of stability so that they can build up working relationships with both customers and suppliers and have enough other issues that bring instability to the daily lives without any artificial stimulus.

So where does that leave Sales people? On the one hand they want the stability because they can build relationships, cross sell and have a quiet life enjoying the expense account and the Mondeo but, on the other hand, if there is too much stability, how do they break into new markets and clients? It’s ironic, but they actually need the world that the buyers are trying to create because that instability is a major source of opportunity.

Competition does mean that there will be winners and losers, and there is nothing wrong in that. It is a fact of nature that we can see all around us any day of the week if we bother to look. The plant life that we all pass by daily reminds us of how the struggle for survival works and it is foolish to ignore that competition is a fundamental element of what has made humans what we are. Look at the stupidities of trying to eliminate the competitive element factor from schools as a prime example of where that leads.

Whilst competition is good there is also strength in combining efforts to work towards common good. For me the point about competition is that it has its place, but collaboration does too.

Like so many things, competition is a tool and, like all tools, you need to use it well and in the right circumstances. I could buy the best saw on the market, but if I went down to the lumber yard and bought a dozen different sorts of timber there is a fair chance that I would ruin both my new saw and some of the wood in short order because you need even different saws for different woods.

So blindly applying competition to sourcing needs is as much of a waste (and don’t get me started on e-auctions) as trying to do fret work with a panel saw. The art of good buying is to use the right method for each requirement. If you can do that then the right deals will generally fall into place.

So to get it right requires collaboration between good people, but isn’t that always the way?

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