and procurement specialists don't always see eye to eye -- and that's putting it mildly. "The bottom line is, procurement doesn't understand the value of relationships and networking," says one corporate planner, "which in our minds is a key component. Everything is just black and white to them, or numbers on a computer screen. They just don't get how important relationships are when working with hotels."
Sound harsh? The planner quoted above actually works within the procurement department, but proximity hasn't helped the two sides come together at all. In fact, he occasionally uses vacation days in order to attend conferences or networking events his boss in procurement deems unnecessary. Discussion of the subject has led nowhere.
"Many people kind of roll their eyes and say, ‘Oh God, here comes procurement,' " says Kevin Iwamoto, who served as global travel commodity manager at tech giant Hewlett-Packard for more than 10 years, where he managed procurement contracts and suppliers, and was responsible for worldwide purchasing strategies. While he readily admits that the interaction between planners and the purchasing folks can be dicey, he also knows that it doesn't always have to be that way.
Iwamoto was one of the first industry executives to publicly recognize the benefits of converging corporate travel and meetings management, and he founded the Groups and Meetings Committee of the National Business Travel Association in 2003. As such, he has witnessed firsthand the evolution of a sometimes uncomfortable synergy. "It's a complex relationship," he says, "but more and more companies are demanding that synergy takes place, especially in light of what's happened with the economy, and with some companies being criticized for their spending or their lack of process when it comes to spending or documentation."
Now vice president of enterprise strategy for the Philadelphia-based meetings technology provider StarCite, Iwamoto is quick to add that he's seen great relationships develop between meeting organizers and procurement specialists. But he says there remains a need to demystify procurement's role.
"At the end of the day, you both want what's best for the company," says Iwamoto. "And it's not going to go away. If dealing with procurement is a part of your job, you need to figure out the best way to do that."
Survey numbers back up Iwamoto's assertion. According to a study conducted by the CWT Travel Management Institute between September 2009 and March of this year, 50 percent of meeting professionals expect procurement's involvement to either increase or strongly increase in the coming years. An additional 35 percent of the 222 international planners who responded predict procurement's influence will remain at current levels.Aligning objectives
A procurement department's priorities will differ based on an organization's size and needs. That said, their motives generally will be driven by three key perspectives, according to Issa Jouaneh, vice president, Maxvantage and Global Meeting Solutions for New York City-based American Express Business Travel. He breaks it down as follows.• Transparency.
Procurement wants to understand an organization's total spend across the company. • Control.
"Procurement is looking to have a process in place that approves and documents the meetings that are happening within an organization and have a clear process in place to protect the organization," Jouaneh explains. An effective process mitigates risk, an increasingly important concern in a number of industries.• Savings and value.
Procurement is focused on driving savings throughout the organization by reducing the total cost of meetings.
It's important to keep in mind those drivers when communicating with members of the procurement department. "Being proactive is critical," advises Jouaneh. "It's important for planners to demonstrate the cost savings that can be generated from their meetings, and also the business impact and results that meetings will drive to the organization."