One of the first steps in any sourcing engagement is to develop a timeline or project plan. Without a general understanding of the timing surrounding your project there is no starting point. However, what happens when that project plan changes during the course of your initiative and gets extended, potentially indefinitely? Not only have you been put on hold, but you run the risk of greater issues with engagement, savings potential, and meeting expectations. The longer the sourcing process goes on, the supplier you're working with may lose the initial excitement they had about your project when you first reached out and introduced the initiative.
As you continue to postpone next steps or delay the decision-making process, the suppliers may start to interpret your actions to mean this is not a real opportunity and disengage from the process. Other opportunities may come up for those suppliers and resources can no longer dedicate the time to your project when things do start to move again. The same can be said of your stakeholder team, they may lose the momentum they originally had for your project. You may also face internal resource constraints as time goes on and priorities change, especially as you enter busy seasons or year-end activities.
Depending on the background of your sourcing initiative, another concern may be in missing savings targets tied to your efforts. Your project may have been projected to achieve a certain savings figure based on negotiations being complete by a certain date, but with your delay you are left with only a few months left in the year to have an impact. This is especially concerning if budget adjustments have already been made based on your original timeframe and projections. Finally, there is the possibility of losing negotiation leverage once a final decision has been made.
Typically when building out timelines there is a buffer between when a decision is made and when the supplier needs to begin work; however as timelines are delayed this buffer period is reduced. If there is a hard deadline for when a supplier needs to be identified and the supplier involved in the process are aware of this, you lose leverage during the negotiations process as that deadline date approaches. Suppliers recognize the fact that you need a supplier in place by a certain date and could take this into consideration when responding to negotiations. Regardless of why your project is delayed, the potential impact on your project could be substantial. As such, it is important that we make every effort to effectively manage timelines and expectations throughout the process. Below are some tips to avoid timeline delays and manage these situations if they occur:
1. Make sure you have all of the right people on your team.
When you are beginning your data collection process and forming the project team, ensure that you have all of the key team members and decision-makers involved in the process. If a new team member is added midway through the project it is important to meet with them and inform them of the progress thus far and gain their buy-in to avoid potential issues down the line. A common reason a project is derailed is because of a new player joining the team with new ideas or who needs to be brought up to speed on the project before moving forward. This person may be a key decision maker who does not agree with the strategy you have been pursuing or could be someone who has a different perspective on your approach that causes the team to rethink their stance. Whether a new team member is added because they are new to a position or because they were overlooked during the initial development of the project team, adding someone new can be disruptive to the process if not managed properly.
2. Don't just focus on the here and now, ask about future strategies.
During those initial meetings with the team to collect information on the project and formulate your strategy, it is important to ask questions about upcoming changes to forecast or strategy that could impact your project. Another common reason for project delays is changes to strategy based on future needs or new directions/strategies. While your strategy may have been applicable for the current state of the category, the strategy for next year may be entirely different meaning your approach is no longer applicable and you have to redo the work you have done to date.
3. Develop a clear scope of work.
Developing the scope of work for your project is one of the most important steps in the sourcing process, if your scope is unclear or missing information it could mean conducting multiple rounds in order to collect an applicable proposal. It is essential that you dedicate the time to collecting all of the data needed to develop your scope and review it with the entire team to make sure nothing has been overlooked. While it could potentially mean taking more time than originally budgeted to develop a comprehensive scope, it will be worthwhile in the end when only one round of proposals is required.
4. Have check-points with the team.
In order to keep your project on track, consider having regular status meetings with the team, during which time you could proactively address any potential issues/roadblocks that could impact your timeline. In the event that a project is delayed these check in meetings can be used as a way to keep your team engaged and continually discuss next steps. If you are not having regular meetings with your team and there is a delay, make an effort to stay in contact as frequently as possible to ensure your project does not fall off their radar. Even if the responses are not resolutions to the delay, information on what is happening will be helpful to gauge when a decision could be made.
5. Update the suppliers whenever possible.
If your project is delayed, one of the best things you can do is to be as transparent as possible with all parties involved. You will more than likely be receiving numerous calls and emails from suppliers looking for an update on the status of your project, you will need to manage these situations in order to keep them engaged. Try to empathize with their situation and give them as much information as you can about what is happening. This is not always possible given the circumstances, but if the suppliers feel that you are putting them off this may lead to disengagement.
There are a number of reasons why a project could be delayed, whether it be strategies changing or priorities shifting, but the result of that timing change could be detrimental. One of the biggest concerns from delays is disengagement, both supplier and stakeholder, as a result of an extended timeline. Similarly, the results of your initiative could be in jeopardy due to a loss of negotiations leverage or not having sufficient time to meet projections. Therefore, managing timelines effectively is an important component of any sourcing project. There are a number of steps that you can take before and during a sourcing engagement to potentially avoid timeline delays and keep your project moving smoothly. No matter why your project is delayed, changes to the timeline can have a significant impact on your project and should be managed accordingly.
About the Author: Megan Connell is a Spend Management Consultant at Source One Management Services and a proven asset in leading and executing strategic sourcing and budget optimization strategies. She is a leader in providing clients outside the box solutions, through detailed stakeholder collaboration and engagement. Her high level of analytical skills and vendor management expertise helps streamline clients operations and drive sustainable cost savings.