How many times have you, the procurement professional, established an enterprise-wide contract only to find your staff making purchases from other suppliers? Even worse, when you find out that they are making purchases from other suppliers, you realize that they are making purchases at a cost that is very unfavorable to the contract that you have established both for strategic and cost reasons! There is a term for this in the procurement industry, and I guarantee you’ve heard of it: maverick buying. The purpose of this article is to present some important ideas on how you can prevent your staff from engaging in this cost-wasting practice of maverick buying.
The first step you can take is to bring up maverick buying with the executive management. If you, the purchasing manager, are the only person suggesting to your team that they stop with their maverick buying, then you have to deal with the fact that these people have so much noise coming at them every day in the form of bids and potential suppliers, that therefore they may just tune you out or not get the message. How can you avoid this problem? Executive buy-in is the answer. When they hear that Vice Presidents and even Chief Financial Officers (CFOs) are all making company policies against maverick buying, that is when your backup has arrived. Now they are not just listening to a strategic guideline you personally set; instead they are following the policies that are backed by the full weight of the company!
Second, just telling people to stop engaging in maverick buying is not going to solve the problem. Even if executives have bought into the notion that maverick buying must stop, you have to be explicit in telling them how to avoid maverick buying! This is the case whenever you are telling your staff not to engage in a particular action. You must provide a clear framework for how they should behave, now that you have told them how they should not behave. The message and chief takeaway here is that you need to establish clear procurement and sourcing processes, so that your staff can understand the steps they need to take to make purchasing decisions that are within company policy, and of course, are not considered maverick buying.
Third, the use of technology solutions can be highly effective in assisting your procurement team in avoiding maverick buying practices. In particular, eProcurement systems can guide your staff to the correct suppliers and goods in order to facilitate compliance with your policy. This eProcurement solution could come in the form of a standalone system, or it could integrate with your bON ERP. For example, NGR’s eProcurement solution allows for all of your approved suppliers to enter their data in such a way that your procurement team will have in front of them a 360 degree “supplier cockpit” where they can then evaluate all of their purchasing options. Also known as an eCatalog system, your procurement team can then make purchases in confidence that they are following company policies. This prevents maverick buying, saves your company money, and reinforces the long-term strategic relationships that you have developed with your most important suppliers.
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