Effectiveness is not a requirement that is peculiar to Procurement. Rather, it is central to success in any realm of life.
My own experiences are adequate evidence for me. I am sure that if many of us examine our personal experiences in successfully achieving things we truly desired in life, we will see clear evidence of the importance of taking the right actions, doing the right things, to get what we want.
In some senses, it’s quite a simple notion to grasp: if you want to move forward, you take a step forward; if you want to head off to your right, then you take a step in that direction; if you want a clean car, you wash it yourself or take it to the carwash; if you want some dangerous excitement in your marital life, you get a lover.
I use these simplistic examples because I learnt a long time ago that knowledge doesn’t have to be complex and heavy; keeping things simple always helps my own comprehension and communication with others.
In reality, of course, the outcomes we want tend to be far less simplistic than turning left or driving a clean car. Nonetheless, the fundamental concept of doing the right things to achieve the outcomes we want remains the same, even when those outcomes are results as complex as outsourcing a key business process or building a successful Procurement function.
The challenge often comes because we get muddled in our thinking, not helped by the societal or environmental factors that confront us daily, whether in our private lives or in our organizational existence. Economic activity and most organizational endeavours are measured by numbers—gross domestic product (GDP), unemployment, sales revenue, profit margins, ROI, cost savings, and so on. So it is understandable that most of us end up viewing our activities at work and measuring “success” by numbers. Typically, these numbers are direct or indirect measures of efficiency—how much output we achieve for our input efforts.
But efficiency measures never tell us whether the outputs we achieve, or are pursuing, are the right ones. Efficiency just tells us how slick we are at getting the outputs. Effectiveness, on the other hand, forces us to consider what we really want in the first place.
Focusing on effectiveness demands that we maintain a strong sense of appropriateness, even in the midst of an efficiency-biased environment. We really have no choice; because, in the long run, whether we are talking about Procurement functions or entire organizations, an entity’s ability to consistently achieve its goals, and, thus, deliver long-term sustainable performance success, depends on the actions it takes…
Read the rest of this Procurement Mojo® excerpt by Supply Chain Management Review here.
