Stakeholder engagement and the five steps to better communication

Procurement’s ability to contribute to business success is hugely dependent on the quality of our relationships with internal stakeholders.

Whilst we cannot directly control how others perceive us, we can strive to improve the quality of our communication so we can work together better.  Ultimately, of course, the challenge is finding the time to do this while dealing with the pressing demands of the day job. It’s never easy but it’s undoubtedly worth it in the long run. With this in mind, here are five steps to improving communication with internal stakeholders by incorporating relatively simple but extremely effective ways of working:

1. Take a step back and think about your key internal stakeholders. Who are they, from recent projects and potential future ones? How well do you work together, from your perspective and from theirs? How could that be improved? Who could act as your ambassadors? Who may be undermining you? How can you address this?
2. Establish which are your priority relationships with you internal stakeholders, recognising that with limited time available you won’t be able to focus on everyone to the same degree.
3. Brainstorm ways in which you could build understanding and trust. Depending on how well you currently work together, some ideas might be:
   • Identify what you would like to know from each key internal stakeholder and actively seek their opinions and points of view – this could be formally (e.g. meetings face to face or by phone) or informally (e.g. in the canteen or by the coffee machine).
   • Ask for feedback on recent projects – find out how suppliers have really been performing, for good and for bad. How can you help?
   • Make a point of following up on feedback – to address issues raised.
   • Conduct short reviews at the end of future projects to see how fully objectives were achieved, how well you worked as a team and what you could do differently to improve in future.
   • Publish stories on the intranet, written jointly with stakeholders, highlighting teamwork, things that worked well, pitfalls to avoid and the achievement of business goals.
   • Ask for slots to make informative and relevant presentations at departmental meetings. Share success stories and mutual challenges faced; seek and respond to ideas and opinions aired.
   • Don’t make it all about work – sharing a joke or talking about common interests shows you value your relationships beyond achieving work-related goals.
   • Make a plan to implement your campaign. This may be as simple as aiming for three positive interactions a week, starting small and building to some of your more challenging goals, or it may be a more detailed and ambitious plan depending on circumstances.
4. Put a marker in your diary to review and adjust your plan every couple of weeks.
5. Celebrate your successes and let them build your collective confidence to face tougher challenges and aim for higher goals.

This may seem a lot to do, but looked at another way, it is really about recognising the importance of adopting a customer-focused mindset and consistently applying some practices which bring this to life on a daily basis. 

By proactively investing time to improve communication with our internal stakeholders, we show them that we genuinely want to understand and respond to their priorities. (Of course, that’s not to say we won’t at times challenge them, or seek to reframe perspectives, so we can explore alternative options!)  It is by working in this cross-functional and assertive way throughout the process that we can ensure appropriate business outcomes are sought and then delivered. Once we are trusted enough to be invited to the table early, we have the opportunity to ensure the selection, and effective management, of commercially compatible suppliers, thereby accelerating the achievement of a wide range of organisational goals. 

If you have a success story to share where you’ve turned a relationship around through better communication, it would be great to hear what you think made the difference in your case. Let us know in the comments below.

Sometimes, what the supplier is interested in is of little interest to us; the relationship may be very distant, the marketplace acts as a trading system, or we have so much power that we choose to ignore the supplier’s interests.

However, and even in the last case, it remains important to understand what the other side of this commercial relationship is interested in, as this may hold the key both to a successful negotiation, but also to a well-founded long term relationship.

Supplier Interests

Examples of businesses ignoring suppliers interests are many. The most basic example is the institutional flaunting of payment terms, sometimes for justified reasons, but more often because of systems in place which have become successful slowing down cashflow to suppliers.

On the buying side (not just the purchasing organization, but the various parts of the organization which are involved in a purchase, including the specifiers, accounts payable, purchasing, legal, the recipient of the product or service) we need to recognise that the ability to provide money to our suppliers in a timely way for delivered products and services is a fundamental part of the relationship in place. The supplier has an interest in that working well as if it does not there is a need to finance the missing cash until it turns up.

Beyond that most fundamental part of a commercial transaction, built into the formation of a contract, there are other interests which are useful to understand. Sales cycles and bonuses are worth recognising, as they can drive urgency towards a particular sale, which may not exist on our side. Equally, there may be particular benefits and emphasis on some areas of a product or service which, if added in, give substantial benefit to the sales team.

Other areas of interest can be identified from press reporting or company reports. A focus into a new marketplace, either by product type or by geography, can be an area of interest which, if we can help satisfy it, will provide a greater need for co-operation with our interests. Similarly, if there is a supplier interest in having a client for a new product or service offering, that can also provide us with benefit.

The issue, then, is how we identify the areas of interest which the supplier has prior to a negotiation. There are a relatively small number of areas to explore, in the areas of basic supplier research, and also the more obvious approach of asking them what they are interested in.

Supplier research is a short process where we identify the key areas of information that we need. We often see procurement teams approaching this without a clear idea of why it is important. Once again, the need to develop insights from the information gathered is the primary purpose, and in this case, the insights we are aiming to develop are an understanding of the possible interests which a supplier has, taken from a broader analysis of their business and our current knowledge of their approaches.

Getting an understanding of what their interests are through discussion can be faster. The sales team, key account managers or friendly executives should be able to express more clearly the sorts of areas they are actually interested in meeting. As with our own businesses, there may be different views available from different individuals and as such we need to be diligent in tracking this down and building a broader picture of those interests.

Once we have a view of this, we are able to test for alignment with our own interests. Where there are common factors, it can make for open discussions. However, there are often areas in which the interests are misaligned, but one party can help the other at little cost or effort to itself. Seeking these areas can provide a dramatic offer of value to one side at little cost to the other, which is a powerful negotiation tactic in itself.

There is a tactical challenge in this whole approach; we need to get used to the idea of seeking and exploring the interests of the other side, as a way of benefitting ourselves. This can seem counter-intuitive, but in reality, it is not. We know from our personal relationships that being interested in only our areas and not interested in the other side is a way of having a poor evening out. Embracing other interests is a powerful way to engage in a negotiation.

Talk to us about Better Communication with Stakeholders, and Supplier Management