How to Plan Change Management in Procurement
Originally uploaded on February 10, 2021
To ensure that all stakeholders are taken into consideration, a change management transition plan needs to be well thought out and structured. If a SMART change management plan isn't carefully considered, this could negatively impact your organisational culture and overall strategy in the long run.
Let's delve into how to plan change management in procurement and the importance of a SMART change management plan.
What is Change Management in Procurement?
Change management is the process of moving your current strategy and departments from how you presently operate to how you wish to operate. This change must be explicitly clear, as effective procurement planning should be transparent to ensure all stakeholders and those of importance appreciate your organisation's short-and-long-term goals.
A change management transition plan is an essential component of any change management process to ensure that your colleagues and individuals across your organisational hierarchy understand the transition's purpose. The transition plan should consider how employees will adjust to the change, such as whether the change will positively or negatively impact their performance.
The change management team should be as organised as possible for a successful, effective and efficient transition; without negatively impacting your current internal and external working relationships.
How to Implement a SMART Change Management Plan?
A SMART change management plan can result in the success or failure of your organisation's intended transition. If your short-and long-term objectives aren't specific, measurable, achievable, relevant and time-bound, your workplace could be missing out on being as dynamic and efficient as possible.
To ensure your SMART change management plan is thorough, remember to consider:
- Your current organisational strategy and core values
Your organisational core values are what drives the success of your business. It's vital that these core values are taken into consideration when deciding how you will move from your current organisational strategy to your intended strategy. If as an organisation, you have decided that these core values are outdated, it's important to communicate your new values with all stakeholders and suppliers to ensure your organisational goals are understood.
- Your short-and-long-term objectives for the change
Your overall long-term objectives will most commonly be made up of multiple short-term objectives. Short-term objectives can have a deadline to be achieved within the next week or the upcoming months. Transparency is key when communicating these short-term objectives to your department and people of importance to reiterate the transition plan's purpose.
Your long-term objectives can be divided into two categories. The first being your objectives to be achieved by the deadline for change. The second should be your long-term objectives following the change, as change management in procurement is an on-going process.
- All available resources to reduce costs
To ensure that all areas affecting the procurement department are considered, you need to evaluate your available resources strategically. This should include how much time you have available and what budget you are working towards.
- How the change will impact your organisational culture and structure
Whilst creating your SMART change management plan, your organisational culture should be reviewed. Is there any way that this change could have a positive impact on the culture? For instance, could it help to drive innovation, create shared values, and develop key skills?
Also, consider how the change will impact your organisation's structure. Could two or more departments work more collaboratively? Perhaps a team building activity day will help to align your structure more thoroughly.
- Delegation of tasks to employees
For any change to be successful, it needs to be a collective task. To ensure your change management plan is successful, you should consider which other departments play a key role in meeting your long-term objectives.
Whilst dividing tasks between the procurement department, you could set up project led teams. Each team could focus on a short-term goal with the long-term objectives in mind. Naturally, some colleagues will have a better skill set to meet the desired task. However, those with more experience could then use this change management transition as a training exercise to help develop the skills of others within the procurement department.
- If your stakeholders agree with the change
When it comes to long-term working relationships, your stakeholders are key. Internal stakeholders such as the board of directors, investors and your colleagues should see this change as a positive opportunity for the organisation to grow moving forward.
Your customers and suppliers are two of the most important external stakeholders to consider. If your customers don't agree with the change, or if the change isn't communicated correctly, this could impact the customer satisfaction of your brand. On the other hand, if you require a quicker delivery time from your suppliers and they don't agree with this objective, it could lead to working relationship issues.
- How the effectiveness of the change will be measured
No SMART change management plan is complete without being able to measure your success. Decide which performance indicators are the most important for your department. For example, this could be whether you managed to achieve your short-and-long-term objectives under your budget, if the change occurred by the deadline set, how challenges were overcome or how stakeholders reacted to the change.
- How often you review the success of the change
The procurement department needs to decide how often to review the success of the change management plan. You could have an initial review after two weeks, followed by monthly reviews within the first year. Or there could be a review every quarter or annually. Be sure to bring these reviews forward if clear issues have arisen since implementing the change management plan.
Remember, your change management transition plan needs to be flexible to react to any macro and micro changes that may arise from external factors outside your organisation's control. For instance, your suppliers' delivery time may be impacted by Brexit regulations between the UK and the European Union. Or, your change management transition plan may need re-evaluating if the Covid-19 travel restrictions has impacted your drivers.
How to Plan Change Management in Procurement
In agreement with the Chartered Institute of Procurement and Supply, the following five areas need to be carefully considered for procurement change management to be successful:
In the first stage, you are identifying the need for change. You should clearly outline your strategic sourcing process to ensure your purchasing and organisational strategy are aligned. Here, you should brainstorm and develop your SMART objectives by considering your current procurement strategy, your overall business goals and the budget the procurement department has to work with.
In the second stage, you need to evaluate if this change needs to occur in the short or long term. For example, you may decide on a SMART goal to tighten your procurement budget within the next quarter by evaluating and seeking resources to help in reducing costs; such as with fuel cards.
The management features included with fuel cards allow businesses to monitor the fuel card activity. Cost-saving solutions like these can help measure the effectiveness of your change management transition plan as well as offering companies savings on fuel.
Next, you are deciding which people are in charge of the successful change management transition. Consider what you wish to achieve at the end of the transition. For example, if you wish to change your current supplier, consider which colleagues have a good supplier relationship to lead the change. Or, could they negotiate a reduced price and quicker delivery service to stop this working relationship from diminishing?
The creation stage involves how you will action the change. To ensure your change management transition plan is effective, always remember to keep your employees view at the forefront. For effective management, the manager and employee relationship must stay transparent to ensure the short-and-long-term objectives and new processes are understood by all.
The most vital stage in your change management plan is actioning your desired change. If you are actioning fuel cards into your fleet, have you communicated this change and ensured all drivers and administrators understand this new process?
Remember, change management in procurement should always be worked towards with a level of elasticity in mind. External factors could impact your plans at any moment. Be sure to take into consideration the key questions of Who? What? When? Where? Why? How? For example, the current pandemic could mean your fleets drivers may have to change schedules to reflect medical abscesses. How will the procurement department go about handling this?
Following the change, you should invite your colleagues and stakeholders to voice their feedback on the change management transition plan and any areas they feel could be improved.
Successful Change Management Transition Plans
Achieving successful fleet procurement means internal changes and development are needed. However, the results are worth the time and effort put into this strategic thinking and planning in the long term.
If you'd like to learn more about what the best fuel cards are for your business to help it run more efficiently, then please don't hesitate to get in touch. Or, for further procurement and fleet management advice, please explore our blogs.