The Big Debate: The internal customer problem

Posted on 11. Mar, 2009 by in Blog

When I first started in procurement I was confused by the use of the word “customer”. It took several conversations with procurement professionals until I realised my mistake – in the world of procurement, the word has more than one meaning.

Most people I speak to in this profession refer to the internal business units who benefit from the work provided by the procurement function as “customers”.

But this immediately presents problems. It paints a picture of subservience to other areas of the business which puts procurement in a much weaker relative position. It gives internal business units the confidence to demand things which they would not be able to demand in a relationship of equals. And it lessens procurement’s strategic influence over the company as a whole.

Procurement brings to the business a huge amount of value. But too often it is seen as a poorer cousin to many other departments – whether this is production, research & development, marketing, sales or finance. By referring to these other departments as “customers” or “clients” procurement leaders are allowing this skewed relationship to continue.

This also poses many implications for the image of procurement. What ambitious talent will be attracted to an area of the business which “serves” the rest of the organisation? They would be far more likely to be attracted to a position which engages with suppliers across the globe, which has a direct impact on the company’s bottom line and which manages corporate-wide projects.

Sound familiar?

To finally put procurement on the executive map, to increase its influence over key stakeholders and to increase its attractiveness as a career of choice, procurement leaders must stop referring to their equals as customers.

Because they are not customers – they are colleagues.

Tags: ,

Leave a Reply