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Sustainable Results

What a coup!

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A procurement coup, that is. A coup, and not of the military sort, “is an instance of successfully achieving something difficult,” according to Oxford Dictionary. Or, according to Merriam-Webster, “a brilliant, sudden, and usually highly successful stroke or act.”

Historically, there are countless coups of note. And arguably, many of the most remarkably valuable of these may be referred to as procurement coups.

The Louisiana Purchase comes to mind.

In 1803, sitting United States president Thomas Jefferson acquired an enormous swath of land, over 800,000 square miles, from the French for a mere $11M dollars.  Initially, Jefferson was opposed to the idea of such an expansive acquisition fearing it was both an unconstitutional maneuver and a potentially unfair expansion of the federal government’s power. Ultimately, Jefferson came around and the resulting land purchase nearly doubled the size of the United States.

The French were not the only ones who sat at the negotiation table with the U.S. Over a half a century after the Louisiana Purchase, in 1867, U.S. Secretary of State William H. Seward signed an agreement with Czarist Russia after the U.S. Senate approved the treaty of purchase. Apparently, the Russians lacked sufficient financial resources to adequately maintain military and civilian presence in such a sprawling region.   Eventually dubbed Seward’s Folly due its cost and the abundance of frozen wilderness to be procured in the $7M deal, it expanded the land holdings by 586,412 square miles which is roughly twice the size of Texas. The eventual discovery of gold, oil and other natural resources provided abundant prosperity for many.

Brilliant procurement purchases are not strictly limited to large land acquisitions. The recent –and rather unexpected- $13 billion purchase of organic food provider, Whole Foods, by giant online retailer, Amazon, not only shocked the global investment community but will redefine the grocery shopping experience. As the New York Times succinctly noted, “this will instantly transform the company that pioneered online shopping into a merchant with physical outposts in hundreds of neighborhoods across the country.”

The above-mentioned procurement examples simply represent a handful of purchasing achievements. The procurement function can be remarkably transformative for any organization… or government. Admirable negotiation skills, strategic direction and sound execution underpin the procurement process.  It is not merely about achieving the lowest price. It includes developing stable partnerships with trusted suppliers, preparing for disruptions through risk mitigation and understanding customer requirements. The effective procurement function provides a gateway to profits.

At SDI, we recognize the value of identifying which business processes are candidates for outsourcing.  And with 25 years of experience delivering procurement solutions for global customers, we are ready to maximize your bottom line results.

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