Supplier relationships are obviously vital to a sound procurement strategy. But for Clive Rees, Chief Procurement Officer at betting giant Ladbrokes, keeping internal stakeholders close is just as important.
Rees has spent time in both public and private sector organisations, including stints at major banks. And while they?’re great at storing data around procurement, one of the joys of working at the smaller Ladbrokes is that gaining proximity with stakeholders is much easier.
?“In a bank there were far too many people that thought either they owned the supplier relationship or they had a say in how to manage it,?” says Rees. ?“At Ladbrokes, I know who the real movers and shakers are because there’?s fewer of them. I?’ve got all but one of the executive directors on a procurement steering group. In their monthly update, I provide what I?’m looking to do as a strategy and tracking against business objectives.?”
So ensuring that there’?s a coherent procurement strategy – aligned to the broader corporate plan – is that much easier.
And at Ladbrokes, that?’s important right now. Quite apart from the usual office procurement, the company has a particularly high-profile marketing presence (it?’s TV ads are in the top ten most recognisable at the moment), is an active sports sponsor and buys in media content for its shops and websites. It’?s also been on the acquisition trail (it bought BetDaq in January). So the range of suppliers is diverse and complex. That puts SRM at the top of the agenda.
But working closely with Ladbrokes’ CFO around cost management means winning over internal stakeholders isn?’t far behind. Rees advises,
?”We can?’t just be seen as the cost cutters or penny pinchers otherwise we will not be engaged in the right way and people will be turned off by us ?- or they?’ll try and protect their budget because they’?ll think we?re just there to collect some elements of it and give it back to the CFO?”
?“You’?ve got to look at the revenue that we then generate as a result of having new customers and retaining those customers,”? he adds. ?“So you?’ve got to understand what the business is about.?”
The relationship with CFO Ian Bull is crucial, of course, and that commitment to see across the piece – factoring in revenue as well as cost around procurement, for example – is driven from the finance function. ?“The positive nature of our relationship has helped me build new connections, particularly at the executive level, and increased my exposure to various people across the business,?” Rees explains.
Clearly, then, good communication is at the heart of Ladbrokes’ procurement approach. Rees also ran a project helping non-procurement people understand his specialism to embed these ideas about good practice at every level. And central to that was the need to listen to the customer – whether that?s inside or outside the business.
A great advert then, for a properly integrated and strategic procurement function. “?We’?re expecting the buyers not only to do deals, but to do a bit of research,?” Rees concludes. ?“Listen to what your customer wants.”? And that?s a sure way to shorten the odds on delivering results in any business.
Click here to read the full transcript of our interview with Ladbroke’s Chief Procurement Officer, Clive Rees.