Supply Excellence — Change Management: Program Design is Key

Change Management: Program Design is Key

May 29th, 2008 · by Latane Conant · No Comments · AribaLIVE, best practices, contract management, enviro/social sustainability, mid-market/growing enterprise, skills rectruitment and development

At Ariba LIVE in Las Vegas two weeks ago, I was a panelist in the Retail/CPG breakout session. Although we had every intention of discussing the results of a recent Retail/CPG survey, the session quickly evolved into a very interesting discussion involving everyone - from panelists to audience members - in the room. Although the topics ranged from breaking into marketing spend to corporate P-cards, the underlying theme was the same … change management isn’t easy.

Unfortunately, sourcing professionals often think that if we can just start saving money, the rest will work itself out. But based on the discussions in Vegas, the just start saving approach can only get you so far. Since many high spend business functions such as marketing and IT are not accountable to procurement, change management is a serious challenge.

So how do you create a spend management program that encourages adoption, compliance and ultimately, cost savings?

The answer is to focus on Program Design, which consists of 3 elements:

Program Goals and Objectives
Program Strategy and Plan
Sponsorship and Organization

Most companies have documented goals and objectives as well as some form of sponsorship. However, they often lack a well thought out strategy and plan, and that is what separates best in class programs from rest of the pack.

From my conversations over the years with companies at various stages of the spend management journey, it’s become very clear that best in class operations devote a great deal of time and energy to program design. They take a deliberate approach to change management AND gain support from non-sourcing functions through relationship building and incentives. Keep those principals in mind from early in the planning process and you’re far more likely to gain the traction and results you’re seeking.

Latane Conant is a Senior Manager in Ariba’s Spend Management Services group specializing in strategic sourcing projects for major retailers.

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