culture de achilleshiel van strategische inkooprelaties · kpmg (2015). strategic visions on the...

CULTUREDe achilleshielvan strategischeinkooprelatiesNieuwegein – 22 Juni 2017

2© 2017 KPMG N.V., a Dutch limited liability company, is a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (‘KPMG International’), a Swiss entity. All rights reserved.

Cultural differences spice up doing business


But how does the modern procurement professional deal with cultural differences?

?Supplier Buyer


Together with Prof. Fons Trompenaars, we conducted research to answer this question


Let’s do a quick experiment: the Ultimatum Game


Met welke vorm(en) van cultuurverschillen hebben inkooprelaties te maken?

Hoeveel % van strategische relaties faalt door cultuurverschillen?

Hoe meet u cultuurverschillen tijdens het inkoopproces?


Now, please grab your smartphone

And go to…www.menti.com using

code: 98 17 61


“Culture eats

strategy for

breakfast”

ReferencesKPMG (2015). Strategic visions on the sourcing market 2016.Tijl (2017). Leveraging cultural diversity in buyer-supplier relations? An empirical study on the role of the procurement functionTrompenaars, F., & Nijhoff Asser, M. (2010). The Global M&A Tango, How to reconcile cultural differences in mergers, acquisitions and strategic partnerships, Infinite Ideas Limited.

70% failure

Still 70% of strategic supplier relations fail due to the fact that cultural differences are neglected when entering into the relationship

- Dr. Peter F. Drucker


Cultural differences occur at 4 different levels

Tensions & dilemmas arise from:National culture differences

Organizational culture differencesFunctional culture differences

Team culture differencesSupplier Buyer


Different organisations value different things because of culture

Professional development


But the procurement function does not have a structured approach formeasuring and managing cultural differences with suppliers

Supplier Culture

Buyer culture

Financial assessment Operations assessment Risk assessment Safety assessment Culture assessment

Supplier Due Diligence


The problem is that this leads to higher coordination costs, and potentially a negative net value of the relationship

BenefitsCosts

Economy of relationship = Benefits – Costs

Economic zone

Maximal benefitUn-economic zone

Low involvement High involvement

Econ

omy

of re

latio

nshi

ps

+

–

0

Optimal level of involvement


How can procurement do this better?

How do you measure culture?

How do you manage the differences?

How do you apply this in sourcing and procurement?

1

2

3






1

2

3


kpmg Trompenaars Hampden-TurnerCulture for Business

1. Laptop/iPad/smartphone

2. kpmgrisk.azurewebsites.net/risk/risk.htm

3. Password: NEVI

We can measure culture: Let’s take our Risk App for example

Explore!

http://kpmgrisk.azurewebsites.net/risk/risk.htm


And we can measure cultural differences: Let’s take our Buyer-Supplier app

Onze organisatie: Sterk hierarchisch & taakgeorienteerd

Leverancier: Sterk egalitair, met name persoonsgeorienteerd

Hoe ziet een strategische inkooprelatie tussendeze partijen eruit?

?






1

2

3


First, we need to change our mindset. How can we solve this dilemma?

Centralisation Decentralisation


We need to crack the line in order to reconcile cultural differences

Better Centralized Knowledge of ever more Decentralized Activities

Cen

tral

izin

g K

now

ledg

e

Decentralizing Activity


On the one hand...

I. We must centralize procurement to leverage our buying power

II. We want to subject our potential suppliers to rigorous security & compliance checks in line with our corporate culture

III. We want our suppliers to adapt to our requirements and behaviors to ensure a smooth delivery

IV. We need to ensure we negotiate a contract that will protect our organization from our supplier's failures

V. We want to make sure that operational and strategic buying are aligned to prevent failure demand (redoing work that wasn't completed successfully initially)

VI. We want to focus on demonstrable hard factors such as costs, requirements, and service levels to keep our internal stakeholders on board

...whilst on the other hand...

I. We must decentralize procurement to respond flexibly to the market

II. We want to make sure new, creative suppliers feel welcome and respected

III. We want our suppliers to be critical and assertive, so that we can benefit from their differences

IV. We need to ensure that informal mechanisms prevail against the formal contractuals for suppliers we want to partner with

V. We want to separate strategic from operational buying to use our resources more effectively

VI. We want to focus on the soft factors to make sure that the strategic relation/partnership actually delivers

Here are some procurement dilemmas we face regularly. How can we reconcile them?






1

2

3


Our approach to managing culture in the procurement process consists of four steps

1. Conduct (sub)culture assessment of internal business stakeholders

2. Choose the appropriate depth and breadth of comparative cultural analysis

3. Use apps for data gathering and analysis

CM & SRMprocesses

Develop sourcingstrategy Tender/

supplier selectionprocess

Analysethe

market

Analysespend & demand

Fulfill payment &logisticsprocess

Processinvoice

Create purchase

order

Create purchaserequest

Approve purchaserequest

Contractnegotiation &

implementation

4. Take risk-mitigating actions and reconcile the dilemmas between buyerand supplier

2

4

1

3


We use a 46-item webtool to collect data from the buyer and the supplier organization

We use a 46-item webtool to collect data from the buyer and the supplier organization

In more complex scenarios, we support our client’s sourcing process by combining online and offline services

We perform an in-depth comparative analysis to identify the tensions and dilemmas that will jeopardize the relationship if not properly managed

We provide levers for risk management and dilemma reconciliation to optimize CM & SRM

App-based Offline Analysis Practical Advise

1

2

3

Implement appropriate KPIs

Develop shared norms and values

Align choice of contract with cultural attitudes

4

5

Match and educate project/category/contract managers

Improve SRM strategy

ManagementYour organization seems to strive for a consistent goal-orientation around the tasks you set as a staff member, whilst your supplier organization suggests that the power of learning and creativity should be leading

ReconciliationMake learning and innovation part of the task description

… …


www.menti.com usingcode: 98 17 61

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© 2017 KPMG N.V., a Dutch limited liability company, is a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (‘KPMG International’), a Swiss entity. All rights reserved.

Contact

John TrosPartner, Management ConsultingKPMG The Netherlands

Tel +31 206 564 056Mobile +31 620 138 165Email [email protected]

Sebastian TijlConsultant, Management ConsultingKPMG The Netherlands

Tel +31 206 567 285Mobile +31 653 956 724Email [email protected]

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culture de achilleshiel van strategische inkooprelaties · kpmg (2015). strategic visions on the...

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