DC Velocity - December 2014

FANS FROM THE INNOCENT EARLIER DAYS OF POP music might remember the monster hit “Joy to the World” by Three Dog Night. But an earlier Jeremiah was a prophet in the Kingdom of Judah, the “weeping prophet” who urged reform and repentance. He is recognized in Judaism, Islam, Christianity, and Baha’i. Some think that I might be modeling Jeremiah, but my own views are not quite as pessimistic.

TILTING AT THE WINDMILL DU JOUR

As we navigate the tortuous pathways of contemporary sourcing and procurement, hands, tendrils, and teeth reach out for us, much like the underwater creatures— grindy-lows, merpeople, and such—who sought to ensnare Harry Potter. One hand that might be judged as either harming or helping belongs to the corporate legal function. Sometimes, the appendage is a talon that captures and cuts; sometimes, it’s a hand that reaches out and offers a pull toward safety and away from almost certain disaster.

Finding a positive balance in the relationship between legal and the sourcing/ procurement functions can be challenging. On the one hand, we are charged with finding reliable, sustainable, high-quality, cost/value-effective, and easy-to-work-with sources, suppliers, providers, manufacturers, and distributors of products, components, materials, technology, software, consulting, project solutions, paper clips, and other elements that make our businesses possible—and profitable.

On the other hand, we must accomplish our mission in
ways that do not jeopardize the enterprise or leave it open
to failure, litigation, business interruption, or scandal. And
here is where legal peeks over our transom to—legitimate-
ly—make sure we are playing by the right rules.
LAWYERS RUN AMOK
In some organizations, the legal function has taken con-
trol of, or exercises universal veto power over, contracts,
BY ART VAN BODEGRAVEN AND
KENNETH B. ACKERMAN basictraining
Jeremiah was NOT a bullfrog!

agreements, RFx (requests for information, proposals, or quotations), and foundational qualifications for any provider of goods or services to the enterprise. In the immediate environment, the consequences might include fights to the death between the supply chain or procurement functions and legal over all issues, both trivial and game-chang-ing; delay; wasted energy; diminished attention to the really important issues; and the unnecessary involvement of senior leadership in schoolyard brawls.

In others, legal is a trusted and valued ally in crafting appropriate contracts with prudent corporate safeguards in place. To be blunt, it is procurement’s responsibility to: 1) take the lead in building productive collaborative relationships with legal; and

2) build, acquire, and
demonstrate capability in
the fundamentals of con-
tracting and provider management.
FIRST STEPS IN SOLVING THE RIDDLE

Here are some questions to ask, if you head up the sourcing and procurement functions in your organization. Your answers may lead to a revelation of what you might consider next:

b Are there clear thresholds and classifications that define when and how to use RFPs, RFIs, RFQs, and other instruments? Have these been defined by you or by legal (or another function)?