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2009 Leadership

Awards

Celebrating innovative thinking in public sector procurement

Leadership and procurementWhy you should develop leadership skills

Procurement leadership in practicePut your skills to work at work

Advancing green procurementSurveys show “greening” procurement still on agendas

January 2010 $6.95

January 2010 Vol. 12, No. 8

from the editor

For many 2009 was not the best year. The economic downturn really hit people

in all sectors and Summit was not immune. As most of you know, we continued to publish the magazine, but only online ...until this issue. Things are looking up for sure, and just in time to pro-

vide you with that wonderful reading experience... a new magazine in your hands!!

This issue focuses on leadership... particularly, on leadership in procurement.

The winners and finalists of Summit’s Leadership in Public Procurement Awards program are featured here with summaries of their submis-sions. Summit thanks you for participating in the awards, and thanks our judges, without whom the awards would not mean so much. It is important to be recognized by your peers and experts in pro-curement and our panels of judges closely examine each submission. Summit thanks the Canadian Public Procurement Council for its collaboration on the award program and for the opportunity to present the awards at the annual CPPC Forum held in Victoria in early November. Summit also thanks BMO Financial Services for its support of the Leadership in Public Procurement Award.

The awards provide examples of leadership in action. Two other articles discuss the more ephem-eral aspects of leadership... you know the ones we have trouble defining but that we all recognize when we see it.. and the authors show us how and why leadership qualities are important in the pub-lic procurement context.

One aspect of leadership that is continuing despite economic impacts is that of efforts to green procurement. “Advancing green procurement” compares two surveys, one from Europe and the other in North America, and finds that on both sides of the pond, greening procurement continues to increase in importance for both the public and private sectors.

I hope you enjoy learning about the leadership being demonstrated by your colleagues, and that you will consider nominating your team or one you know for the 2010 awards. Information will be available January 2010 at www.summitconnects.com.

Special feature Leadership in Public Procurement Awardsthe 2009 winners and finalists of the awards were announced at the annual cppc forum 2009 in November in Victoria. presented here are summaries of their submissions. if you are looking for examples of good ideas put into practice these will suit you well. by Summit staff

Procurement leadership in practicepracticing leadership each day may mean weaving a web of relationships that in turn make you effective.by Denis Chamberland

Advancing green procurementtwo surveys on opposite sides of the atlantic demonstrate that for procurement professionals, sustainable procurement practices and choices are still top of mind and will continue to be so. it just seems to make sense: financial, practical and moral.by Anne Phillips

Leadership and procurement

Should procurement staff exhibit leadership or strive to improve leadership skills? this question sets the stage to discuss leadership in the procurement context.by Stephen Bauld and Kevin McGuinness

modes of negotiationOften procurement staff find themselves conducting negotiations.this article offers some pointers and practical tips.

by Mark Trowbridge

CPPC Forum 2009another successful year of interesting sessions, lively plenary speeches and discussions and of course, networking with colleagues from across canada.by Summit staff

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Two reports, HEC-EcoVadis 2009 Sustainable Procurement Benchmark and TerraChoice’s EcoMarkets 2009,

show that “green” procurement continues to grow in importance within the public and private sectors despite the recent eco-nomic downturn. In fact, in some cases the downturn is seen as an opportunity for greener offerings of goods and services with the attendant technology develop-ment. The pressure to be greener appears to be due to an increased consciousness on the part of citizens/consumers regard-ing sustainable development and environ-mental issues… more people are simply making those choices when spending personal dollars, and are demanding the same attention from buyers in the public sector and from manufacturers and ser-vice providers in the private sector.

The pressure is having a ripple effect. Major suppliers in both manufacturing and retail are applying significant pressure on their own suppliers, effectively push-ing the “green” demand down the supply chain. For example, HP and Xerox have made significant changes in the print-ing area. Walmart took its supply chain by storm with its packaging reduction goal – just one of its many green focussed efforts – providing impetus for thousands of its suppliers worldwide to confront and resolve the issue if they wanted retail space on Walmart shelves. These companies are not alone in their efforts to provide greener goods and services.

For you as public sector buyers, pro-curement became more complicated by adding green considerations to the already complex equation. The sheer size of the public sector marketplace can and does have an influence on the suppliers and what they offer. You have an important role to play in advancing green procure-ment in that you must exercise your expertise and be diligent to ensure that the green claims of the goods and services you

are purchasing can be backed up by green evidence. A recent study by TerraChoice Environmental Marketing shows that “greenwashing” – the act of misleading consumers regarding the environmental practices of a company or the environmen-tal benefits of a product or service – is alive and thriving in the supplier community. It is an international challenge According to the study, so-called ‘green’ products have increased between 40 percent and 176 percent. TerraChoice developed a list of six greenwashing (www.sinsofgreenwashing.org) sins, and this past spring added a sev-enth: the ‘Sin of Worshiping False Labels.’ Assessing greenwashing is not always easy, but certification, market sector knowledge, support from your own internal “green” procurement experts, transparency in what you are seeking and continuous learning about this continuously moving target will allow you to make the best decision pos-sible at any given moment. And, transpar-ency about those decisions and the criteria you based them on will enable you to defend them should that be needed in this evolving environment.

Despite the challenges, the results of the two studies show that you are not alone.

HEC-Ecovadis 2009 Sustainable Procurement BenchmarkThe internationally acclaimed HEC Paris (École des Hautes Études Commerciales de Paris) was founded in 1881 by the Chamber of Commerce and Industry of Paris. The first HEC sustainable develop-ment study was done in 2003.

EcoVadis operates EcoVadis SP©, a collaborative platform integrating a Web-based software and analysis services that allow companies to assess the environ-mental and social performance of their suppliers on a global basis. It combines technology and corporate social responsi-bility (CSR) expertise to deliver simple and reliable suppliers scorecards, covering 150

purchasing categories and 21 CSR criteria. Pierre-François Thaler is a partner

and co-founder of EcoVadis. Thaler has 14 years experience in procurement and the business development of innovative solutions for procurement organizations. He was previously CEO and co-founder of B2Build SA, the first electronic procure-ment solution for the European construc-tion industry.

According to EcoVadis, “Implementing sustainable procurement on a wide scale is a challenge for many organizations:• The number of standards published

by NGO’s, government and private companies, related to sustainable development is growing everyday…and procurement professionals cannot cope with the proliferation.

• Accessing reliable information on the environmental footprint and social practices of a supplier is challenging… especially true for smaller suppliers, which, in some cases, represent the highest level of risk.

• Even if sustainable procurement goals are generally supported by most employees, significant change management issues remain - the most important being linked to the short term objectives of the buyers (savings) conflicting with the medium to long term goals associated to CSR.

• Unlike many other supply chain risks (financial, operational), the environmental and social risks are carried through the various tiers of the supply chain. You may be more exposed to the unethical practices of your Tier 2 and Tier 3 suppliers than you are to your Tier 1.”

Thaler, who is based in Paris, expanded on this last statement, noting that while many organizations evaluate their Tier 1 suppliers, some are pushing their Tier 1 suppliers to evaluate their subcontractors. Thus the Tier 1’s score depends on how

advancing “green” procurement by Anne Phillips


their Tier 2 and 3 subcontractors rate as well. Walmart is using this method to push the evaluation process downward through the supply chain.

Over time, sustainable develop-ment (SD) has become a key concern for procurement departments. The HEC-EcoVadis 2009 Barometer looks at how sustainable procurement initiatives are weathering the current economic and industrial crisis and at the solutions procurement directors developed to solve the implementation difficulties they faced as were revealed in the 2007 study.

Only about three percent of study respondents were from the public sector but Thaler said that he finds the public sector “as engaged, if not more so than the private sector. The public sector in Europe is lessening the environmen-tal impact of products and services by reviewing standards, and what they buy… the private sector is engaging their own suppliers in the effort.”

According to the 2009 study, (online at www.ecovadis.com), the responses of a large number of European procurement directors to the “same strategic and opera-tional questions to assess the progress of intentions as well as achievements” shed light on the development of sustainable procurement and moving from a “Why?” to a “How?” approach.”

The study defined the principal lessons learned:

• Sustainable procurement is the number 3 priority of procurement directors, an objective deemed “critical” or “important” by 90 percent of them.

• Image protection and cost manage-ment remain two key motivation factors, but compliance with envi-ronmental regulation completes the trilogy. According to Thaler, “the public sector wants to lead by exam-ple… to have a good reputation.”

• In 2009, the objectives are consid-ered “achieved” or “in the process of being achieved” by 80 percent of the respondents. The transition to opera-tional implementation is effective.

• The obstacles mentioned in 2008 (contradiction between short and medium-term objectives and lack of pertinent indicators) remain pre-dominant, with an additional focus on budgetary constraints.

• Only 11 percent of companies intend to reduce the sustainable procurement budget; 35 percent will increase it despite the budget cuts affecting most companies. The study concludes that the recent economic downturn will reinforce the need for sustainable procurement policies… perhaps even be a crucial lever to end the crisis.

• Of the companies interviewed 37 percent have put in place a sustain-able procurement department or at

least a dedicated entity. Half of the companies have raised their buyers’ awareness, or fully trained them in SD concerns.

• The tools specific to sustainable procurement have significantly evolved, with a special focus on supplier evaluation and risk analysis tools for each procurement category or each country. Supplier evalua-tion methods have become more prominent to the detriment of the buyers’ empirical judgement. These CSR evaluations do not yet cover the entire supplier portfolio, with only 11 percent of the companies applying them to all suppliers. When asked what was meant by the words “detriment of buyers’ empiri-cal judgement” Thaler said that “companies now use more supplier evaluation tools to assess perfor-mance, where before they used to

rely on buyers’ judgement. With the use of formal tools, organiza-tions can now give consistent and important weight to the assessment criteria and process.”

• CSR is being integrated into the bid-ding process and 30 percent allocate significant weight to these criteria in the grading and selection system (average weight is 10 percent).

• Finally, 75 percent of the compa-nies use sustainable procurement performance measurement indi-cators, although these indicators are still largely focused on pro-cesses and resources. In addition, progress has been made regard-ing the emergence of individual performance objectives required of the buyers for approximately 16 percent of the respondents.

Thaler says that large companies see “the supply chain as a risk to manage, but also as an opportunity to excel. Even with the natural competitive environ-ment between these companies, they share information among themselves in the effort to minimize SD impacts. For example, in the auto industry informa-tion is shared regarding alternative fuels. However, the vehicle manufacturers differentiate themselves based on the type of fuel being used and how well the automobile utilizes it.”

One of the tools most commonly implemented is the Sustainable Procurement Charter, which varies from a simple outline of “major principles and values” to a detailed code of conduct. Those tools next in line are more opera-tional and include supplier self-assess-ment, categories/countries risk analysis, supplier audit programs, best practice guidelines, and total cost models. Many seek out specialized service providers or professional associations that provide standards and solutions. Many use the various government and organization environmental certifications, but these labels are not applicable to all products and services. If you are just starting to develop a sustainable procurement policy, Thaler suggests you “review your supply base and find the 2 or 3 catego-ries with the highest SD impacts and then develop the tools or methods to assess your suppliers.

“ Be diligent to ensure that the green claims of the goods and services you are purchasing can be backed up by green evidence.”


terraChoice Ecomarkets 2009 and GreenwashingTerraChoice Environmental Marketing Inc. manages Environment Canada’s EcoLogoM Program. It also provides the EcoBuyer network, the Environmental Choice catalogue, and the EcoSAT procurement self-assessment tool to help you include environmental and social criteria in your buying practices. TerraChoice also conducts an annual EcoMarkets Survey. In 2009, it part-nered with the National Institute of Governmental Purchasing (NIGP), the Purchasing Management Association of Canada (PMAC), and the BuySmart Network (formerly known as the Sustainability Purchasing Network).

The survey was completed by 587 professionals with diverse purchasing expertise in a variety of procurement-related jobs in Canada and the US. Most work for organizations that either have a formal (37 percent) or an informal sustainability policy (19.5 percent) and of those in organizations without such a policy, more than half indicated they plan to implement one soon – an increase in both areas over 2008.

When asked what would motivate implementing a sustainability and/or environmental policy, more than half said “interest from senior management” followed by the “need to comply with regulations.” The third factor identified was “employee demand.” Interestingly, while the top two factors chosen by public purchasers are also on the list of factors for companies, according to the study, “the prime reason for a com-pany to implement a ‘green’ purchasing policy is the ‘organization’s commit-ment to sustainability’ (suggesting that for many organizations, developing a “green” purchasing policy may be one of the first steps taken towards greater sustainability).”

This is a good sign that organizations still consider purchasing policies to be an effective tool for promoting “green” purchasing within their organizations.

Like the HEC-EcoVadis study, TerraChoice also looked at the poten-tial effects of the economic downturn. According to the survey, “purchasers continue to buy ‘green’ despite a down-turn in the “economy”.

Generally the most important pur-chasing factor continues to be “per-formance,” but most of the purchasers surveyed said that there is “no discern-able difference between “green” products and their conventional alternatives.” “Availability,” “durability,” and “purchase price” were also ranked as important, as was “environmental considerations.” Apparently many purchasers do still think that green products cost more, but they also believe that “more com-petitive pricing for green products” will

encourage more buyers to purchase these products.

So whether the study took place in Europe or in North America, on the economic question the results appear the same – no appreciable negative impact on ‘green’ purchasing. Both studies show an increase in sustainability awareness and the implementation of policies and pro-cesses to support ‘green’ purchasing. The sophistication and timing of the approach at any given organization is variable, but overall we are all going ‘green.’


Leadership and Procurementby Stephen Bauld and Kevin McGuinness

What is the proper leadership role of public servants, and to what extent (if any) should

those who work in public procurement be expected to exhibit leadership? Is it even important that they do so?

In our view, the answers to these questions are self-evident. However, pro-curement scandals such as those associ-ated with e-Health in Ontario, are the result of a pervasive failure of leadership at virtually every level of the organization concerned. To avoid problems, it is neces-sary to emphasize the important leader-ship role that purchasing professionals can and should play within the organiza-tion as a whole.

Many may overlook the importance of purchasing, but most great leaders of history have been quite sure that it is very important. In the military, “purchasing” is essentially logistics. “An army marches on its stomach,” Napoleon once declared. There is no doubt that he was right; if men and materiel are not there on time and in sufficient quantity, the army is not going anywhere. Training in procure-ment is a vital aspect of giving fighting forces the ability to perform effectively in the field. Purchasing is just as important in the civilian sector. For instance, many of the biggest failings with respect to Hurricane Katrina related to inadequacies of the two critical purchasing aspects of

procurement: supply and logistics. On a more positive note, to a large extent, the Japanese economic miracle was linked to innovations and improvements in the management of supply.

Leadership is important in the procurement context because, within an organization, procurement touches and concerns so many parts of the overall organizational operation. One can learn almost everything about an organiza-tion by watching what it needs, what it wants, what it buys, when it buys, how it buys and what it does with what it buys. Conversely, poor purchasing performance translates into poor performance by the organization overall. Money wasted on bad procurement decisions and process destroys organizational effectiveness. Thus, the importance of leadership and procurement is difficult to exaggerate.

What do we mean by leader-ship? Reading books on the subject, it becomes clear that the practical require-ments of “leadership” are a matter of debate. Even the terms “leader” and “leadership” lack clear and precise definition. Leadership may be variously described as being: the ability to focus the progress of a group; a personal-ity trait; the ability to influence the behaviour of others; a form of special-ized persuasion; a power relationship; an instrument to assist an organization in

achieving its goals; a structural relation-ship within an organization; or some combination of the foregoing. Yet, curi-ously, we all seem to have an intuitive ability to identify weak or strong leader-ship. Very often, leadership is subtle. Most authorities on the subject agree that it is not something that comes with a particular job, like a bigger office or better perks; it is a quality of the person who has a job, and as such it is one that can be exhibited by a person regardless of their rank within the organization.

The leadership texts suggest that studying leadership is essentially about identifying the skills that will make anyone better at their job. For practical purposes, leadership may be equated with doing a job right. By doing a job right, we do not necessarily mean doing it well. Being a top purchasing performer from a technical perspective (working within applicable rules, applying them according to their spirit rather than the letter, deliv-ering good quality work on time, helping others) are all part of doing the job right, but they are not the entirety. For this reason, leadership training begins with giving people the basic skills that they require to assume responsibility, and to discharge whatever managerial authority may be entrusted to them in a way that – if not spectacular – is at least not mani-festly incompetent or catastrophically bad.


Leadership and Procurementby Stephen Bauld and Kevin McGuinness

Leadership, however, goes beyond competence. It requires a purchas-ing professional to take on a personal responsibility for the organization’s per-formance. This, in turn, requires vision; the capacity for strategic thought; a positive and proactive attitude; drive; tenacity; balanced enthusiasm; a will-ingness to take risks, but the sense to provide for the hazards that are likely to be encountered; an understanding of the importance of rules, but the flex-ibility to apply them in a sensible and balanced way.

Particularly, in the field of public administration, leadership requires generosity and compassion; fore-sight, knowledge and wisdom; strong decision making ability; and the ability to manage people effec-tively, as for instance by couching peak performance and building a strong team. Of particular impor-tance in the procurement context is a commitment to the prudent management of resources.

These are not talents easily devel-oped. People are not born leaders, although some develop that skill far faster than others. Leadership skills are honed over time, through experience and training – and through reflection. Leaders appreciate the importance of their jobs to the greater public welfare.

We have left “charisma” off this list of leadership requirements intention-ally. If there is one problem that besets modern society, it is too much focus on charisma. As a result, we have built a society governed by the catchy phrase (the “sound bite”), and preoccupied with spin. Form seems to be more important than substance. An excessive preoccupa-tion with image detracts attention from courage; self-control; decisiveness; reason and understanding; the value of experi-ence and wisdom, principle, honesty and integrity. As the Romans learned before us, and as we are learning painfully now,

rhetoric mastery is no substitute for the ability to develop sound policy, nor is the power to whip up a crowd in a speech the same as the ability to convince the public to make hard choices.

Leadership is most important in times of difficulty, particularly in crisis. In such an environment, people need

leaders who possess resilience (the ability to make the most of a bad situation); a sense of destiny and a willingness to explain purpose; the ability to commu-nicate to everyone the importance of the task on hand; and the devotion to duty required to carry that task out. These skills and qualities are not limited to being required of leaders of state, but are those that are demanded of any person who must assume a leadership role.

It requires no particular imagination to list the practical skills that leaders require within any organization to per-form effectively.

These include effective communica-tions, comprehensive strategic planning and the ability to translate such plans into effective tactical execution, effective negotiation skills, motivational ability, the ability to break down complex assign-ments into manageable tasks through simplification, prioritization, and proper

“Many may overlook the importance of purchasing, but most great leaders of history have been quite sure that it is very important.”


supervision, the ability to work effectively within the organizational structure, com-mitment to proper reporting, and work-ing within governance constraints. Most importantly in the purchasing context, effective management means a genuine commitment (demonstrated by actual performance) to on time, on budget delivery of products that meets the client department need.

Few would argue that sufficient atten-tion is given in modern public admin-istration to fostering such an approach to on-the-job performance. Modern personnel practices often fail to seek out potential leaders, because other concerns are given priority. Even where possible leaders are hired, little support is given to the development of their leadership potential. Many government training budgets are being slashed in the face of declining revenue and the diversion of funds to more “critical” programs – as if saving money, or spending it in a prudent and effective fashion was some kind of optional extra rather than being fundamental to the success of programs. Canada needs to reinvigorate the leader-ship training process. One advantage of doing so in the procurement context

is that improved leadership will lead to almost immediate improvement in public financial performance.

A buyer who shows true leadership potential will be one who discharges their assigned responsibilities with pru-dence and probity. He/she will care about getting results for the client, but will do so in a manner consistent with applicable law and policy. Effective procurement is not just a job to such a person. It is a way in which to demonstrate care for the community being served. Public service is fundamentally about stewardship. For many public servants, it was the desire to do something for the betterment of society that led them into the public service in the first place. This kind of spirit needs to be encouraged if we are to restore public service to a position of pride and respect.

Public servants cannot do their job properly if done complacently, or by hiding in a corner so no one will see, or by looking to outside consultants to do it. No one can be expected to be right all the time, so a public servant must have the courage to stand up for what is right and to give honest advice. In any organization there is a decision-making

process, but sensible employers will agree that it is important to tell your boss what you think, and why. Leadership in the public service means taking on personal responsibility for the whole job. It means taking decisions that have to be made, even when they mean sticking your head above the parapet.

Leadership also entails respecting the role and the decisions of those in author-ity over you. The balance between these apparently inconsistent tasks is as follows: it is for senior managers and elected offi-cials to make the key decisions. However, it is the responsibility of the entire public service to make sure that these decisions are made on an informed basis, with a full understanding of the implications of the decisions being made and the range of options that are open to them.

Kevin mcguinness is a lawyer with Ontario’s attorney General.

Steve Bauld spent many years as purchasing manager at the City of Hamilton; held the position of vice president of the Ontario General Contractors association and is now the publisher of Summit magazine.

Together they have collaborated on several books about procurement and leadership and are regular contributors to Summit magazine and theyou asked For It series of procurement seminars.


LeadersHIP In PuBLIC PrOCureMenT aWard

Winner

Light Duty vehicles Strategic Sourcing initiativecity of edmonton

Team: Alec Chan (team leader), Bruce Kobialko, Claire Ehman, Dennis Simcoe, Dale Weiss, Don James, Don Turenne, Gary Dyck, Ken Arychuk, Huong Trac, Messe Desse, Neil Ganske, Norman Li, Ray Bridgewater, Ray Ng, Sam See-Too, Terry Mandziuk

Sponsored by

in collaboration with canadian public procurement council presents t h e 2 0 0 9 L e A D e R S h I P A W A R D S

L to R: Anne Phillips (Summit), Duncan Campbell and Angela Racette (BMO), Dan Lajeunesse and Alec Chan (City of Edmonton), Kathleen Muretti (President, CPPC) and Greg Leng (NRCan, CANMET)

The City of Edmonton light-duty fleet supports civic services and operations, and included passenger vehicles, cargo and mini vans, SUVs, pickup trucks (1/4-2 tonne), cab and chassis, and police vehicles – 1350 units with an annual purchase requirement of approximately 200

units. Expenditures exceeded $5 million.Prior to this project, vehicles were purchased primarily based on business requirements with

no consideration of related costs and the potential efficiencies to be gained by standardizing the vehicles where possible. Tenders were issued periodically to establish standing offers with local deal-ers of all major vehicle makes and separate tenders were issued for parts. The mix of vehicles drove up maintenance and repair costs, and inventory complexity.

Summit: Canada’s magazine on public sector purchasing, in collaboration with the Canadian Public Procurement Council and other interested parties and sponsors, is pleased to introduce you to the winners and finalists of the award program for 2009. This is the 5th year for Leadership in Public Procurement award and the 3rd year for the Leadership in Green Procurement award. Competition for both is fierce, and comes from all areas of the public sector. In the following pages you will have the opportunity to taste the success of your colleagues and we hope that this will encourage you to contact them for further information and to submit your own projects for the 2010 awards.

THank yOu TO Our judGesJérôme thaUvetteDirector General , Services and technology acquisition, management Sector, public works and Government Services canada

dereK BateScity manager, city of prince George, Bc

StePhen CooKmanager, procurement and contracts, university of waterloo

Jane BUrnS alberta health Services

ron de vrieSVice president, contract and client Services, Defence construction canada

miChaeL aSnerpresident, asner consulting, Vancouver, Bc


The Purchasing and Contract Services Department of Edmonton Public Schools is proactive about taking responsibility for the school district’s impact on the

environment as well as the social and ethical issues surround-ing procurement. The guidelines are set by board policy which, while seeking maximum educational value for dollar spent, recognizes environmental certifications and industry standards, asks vendors to provide evidence of social, ethical standards and, “all factors being equal,” gives preference first to local ven-dors, then provincial vendors followed by national suppliers.

The challenge facing the board in its Sustainability through Proper Disposal Program was to prevent technology com-modities from ending up in the city landfill and to manage the disposal of obsolete products without incurring additional costs.

LeadersHIP In PuBLIC PrOCureMenT aWard 2009

finalist

Sustainability through Proper Disposal Programedmonton public School Board

Team: Brian Barclay (team leader), Ken Sanford

With the support of senior city management and council, in 2008 key stakeholders from all city departments collabo-rated to introduce a strategic sourcing methodology that would heighten accountability in departments to right size their vehicle requirements and to improve the procurement process and vendor management. A request for proposal was

issued in September 2008. Winning bidders were evaluated against pre-established criteria, including a comprehensive total cost of ownership financial evaluation. A standing com-mittee has been established to provide oversight and formal-ize the change management process, and to ensure that the standards set continue to provide best value to the City of Edmonton.

The success of the project is demonstrated by:• vehicle standardization and base model reduction;• a shift in corporate behavior towards sustainability and

environmental considerations and right sizing;• emissions reduction;• a corporate policy that specifies vehicle standards and

assigns accountability to departments;• streamlined vehicle specification and purchasing processes

and vendor performance management;• longer-term strategic sourcing benefits driven by the col-

laborative process such as job function/role based vehicle layouts, configurations and accessories standardization, standard vehicle catalogue, vendor value-added services, parts tracking visibility, etc.;

• establishing performance metrics; and• the professionalism of the city’s Materials Management

Branch became evident at the corporate level.


Winner Light Duty vehicles Strategic Sourcing initiativecity of edmonton

cont’d from page 11

Anne Phillips (Summit), Duncan Campbell (BMO), Alec Chan and Dan Lajeunesse (City of Edmonton)

Given the board covers nearly 200 education sites, monitoring the waste and determining a successful strategy to meet their goals was a huge challenge for the board.

Functioning computers were distributed to high need schools whose technological requirements were not as complex. The district’s IT department dismantled end of life computers and provided parts at no charge to service functioning comput-ers. Parts that were not useful were picked up at no charge by an approved recycler to be disposed of in a manner that meets legislative requirements.

The board also switched from cathode ray tubes to flat screens saving nearly $32,000 in electrical costs over a one year period. Arrangements were made with photocopier vendors for them to take back the equipment for disposal in accordance

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natural Resources Canada (NRCan) determined that the objectives of the project would be:

a) To create a one-stop shop (a website) where managers could retrieve procurement requests to allow them to bet-ter track procurement transactions.

b) To develop a more efficient and effective process for pro-cessing procurement requests, by:

• eliminating the transit time associated with paper requests by having an electronic workflow;

• ensuring that procurement requests include all of the required information (e.g. mandatory fields on the form) when requests are routed to procurement officers;

• creating automatic routing of procurement requests through the necessary authorization levels; and

• tracking the action time following a procurement request’s submission, so that any transactions “idling” (i.e. awaiting management authorization) too long can be followed-up.

c) To reduce paperwork, contributing noticeably to NRCan’s strong commitment to “greener” practices.

NRCan created an online eProcurement tool – a set of e-forms connected by workflow. It was implemented to allow users to submit procurement requests faster, more easily and more reliably, replacing several unstructured methods and prac-tices formerly used to submit procurement and contract requests to NRCan’s Shared Services Office (SSO).

During the pilot phase of the project, the desired procure-ment process and workflow were documented, and the system was built to conform to this new process. A select group of users were given the opportunity to “test drive” the system and suggest improvements, providing valuable feedback to the procurement management and system developers. The second phase began in February 2008, when the enhanced system was deployed department-wide, and was made a compulsory tool for all procurement requests.

Clients have accepted the tool and are receptive to future developments. Users are supported by help fields for each data item they must enter, and the NRCan IT Service Desk has been expanded to provide first and second-level support for users with technical or business questions. Feedback is continually collected from clients via the IT Service Desk, and enhance-ments to the system continue to be developed and added to the system.

By designing its own product, NRCan was able to develop and reuse much of the code for other departmental applications (complementary to eProcurement) economizing a great deal in the process. It utilizes several NRCan Enterprise applica-tions like the Signature Specimen Record (SSR) to minimize the effort required to complete the procurement request form and to facilitate appropriate electronic approvals, a new and exciting feature that cuts lead and processing times for clients. Specifically the SSR function authorizes the delegation of sign-ing authority to individuals who have the appropriate financial delegation.


finalist

Shared Services Natural resources canada team: Geoffrey Su (project officer), Gaea Guruprasad (team leader), louise martel, marie plante, luc casault

with legislation. The board is testing new types of inks which would eliminate the need for toner cartridges and is examining other aspects of the recycling process, which does cost money. One option being considered is to have equipment shipped in reusable containers as opposed to cardboard. The board has also developed an online internal program called For Sale Trade which through the purchasing department allows schools to post ads for products they need or no longer require. Schools barter and exchange products among themselves. Following this success, the C-Port website was created which allows schools and non-profit organizations to share information about

cont’d from page 12

requirements or products no longer needed. The organizations in the community deal directly with each other to source their needs, reducing redundancy and storage costs related to keeping non-required products and having these items end up in landfills.

By examining all aspects of the board including the habits of users, the characteristics of its suppliers and understanding the life cycle of the various products and commodities, the Edmonton District School Board is making a positive impact on its own environmental footprint and promoting prac-tices that help conserve resources and impact our health and wellness.

Sustainability through Proper Disposal Programedmonton public School Board


finalist


LeadersHIP In Green PrOCureMenT aWard 2009

Winner

REtScreen internationalNrcan, canmet

Team: Greg Leng (team leader), Urban Ziegler, Nathalie Meloche, Kevin Bourque, Farah Sheriff, Amelie Richard, Tommy Anderson, Julien Poirier, Lucie Nolin, Dinesh Parakh

The RETScreen Clean Energy Project Analysis Software is a clean energy decision-making software which is provided free of charge by the Government of Canada,

as part of the government’s commitment to promoting clean energy projects worldwide. The software significantly reduces the costs – those arising at pre-feasibility, feasibility, develop-ment and engineering stages – associated with identifying and assessing potential clean energy projects, allowing decision makers to determine quickly and unequivocally the financial viability of a clean energy project, thus encouraging smart purchasing and expenditures.

The software, used by more than 200,000 people in over 200 countries and territories and available in 35 languages, breaks down the technical barriers to implementing clean energy projects. It is part of many university and college cur-riculums. As of 2009 RETScreen has been directly responsible for over $4 billion in user savings. This proven software allows engineers, architects, financial planners and procurement specialists to model and analyze any clean energy project with confidence. A sampling includes energy efficiency from indus-trial to residential facilities; heating and cooling from biomass, heat pumps, and solar air/water heating; power including renewable like solar, wind, hydro, geothermal, and other sources such as gas/steam turbines and reciprocating engines and cogeneration. Training is available by webcast, presenta-tion slides and instructor notes, case studies, an engineering workbook, and a detailed user manual.

RETScreen is managed by NRCan’s CanmetENERGY research centre in Varennes, Quebec supported by interna-tional experts in clean energy. Principal partners include

NASA, UNEP, the Renewable Energy and Energy Efficiency Partnership (REEEP) and the Global Environment Facility (GEF). By 2013, it is estimated that RETScreen will have encouraged the installation of at least 24GW of installed clean energy capacity worldwide. RETScreen (www.retscreen.net) has proven to be a valuable tool that facilitates green procurement.

david aSh Director, infrastructure and transportation, procurement Services, Government of manitoba

eriC BLanChette-oUeLLet agent de la gestion financière, centre hospitalier universitaire de Québec

marC ChernenKoff manager, procurement Services, city of airdrie, aB

StéPhane girardinGreen procurement advisor, policy Development Directorate, OGGO, public works and Government Services canada

Steve miLLS, B.a., C.P.P. manager, purchasing and Office Services, York catholic District School Board, ON

Larry ProUd B.SC., C.P.P.purchasing and inventory control manager, Bc transit

rodney mCdonaLd, m.a., Leed aPDirector, environmental Strategy, minto Green team, the minto Group

THank yOu TO Our judGes

16 Summit january 201016 Summit january 2010

annually HRM Operations was consuming over 35,000 AA and AAA batteries, which were disposed of follow-ing use. In its greening effort, the team decided that

they would ensure that the single use batteries they chose would be recyclable and that introducing rechargeable batter-ies where possible could conceivably reduce the consumption and disposal of over 10,000 single use batteries each year. As well, given the weight of each battery and the fact that a single rechargeable battery can replace 500 to 1000 disposable batteries over the life of the supply, the number of dispos-able batteries that could enter the solid waste stream could be


finalist

Green Battery initiativehalifax regional municipality (hrm)

Richard MacLellan (team leader)


finalist

Going Green initiativeKawartha pine ridge District School Board

Team: Colin Munro (team leader), Steven Cook, Donna Sorrell, Brian Killen, Bonnie McCrimmon, John Lindsay, Deb White-Hassell, Mark Allen, Jane Nahrgang, Ken Wilford, Kevin Edwards, Dan Steward, Ian Dinnage, Greg Sleep, John Baker, Cameron Sutherland, Mike Shupka, Andy Bowes

Colin Munro recognized the importance of being more environmentally conscious and ensuring the workers and the students were healthier. His committee – custodians,

supervisors, purchasing and a school board trustee – examined the operations of the board’s 80 elementary schools, 16 sec-ondary schools, 125 portables and 8 administration sites and then looked at what it wanted to tender in the prequalification process in its effort to be greener.

Out of four respondents, only 2 companies met their requests. Four test sites were set up in schools where the two companies placed the chemicals and green equipment (auto scrubbers, loop mops made from plastic pop bottles and micro

reduced by 3-7 million. This also reduces the amount of heavy metal (mercury and cadmium) waste that ends up in a landfill. HRM has significant waste diversion goals and this initiative met those priorities.

When HRM solicited its vendors for solutions to their bat-tery challenge, they found ten responsive bidders that offered competitive pricing. HRM’s environmental stewardship effort was not going to add any cost to previous per unit pricing. HRM has communicated their initiative to other public pro-curement groups as a positive change that will contribute to waste management.

fibre clothes and dry mops) and bio-degradable bags. Both the companies and their products were evaluated on several items (product quality, pricing, ordering system, customer service, overall green, etc.) to determine which company would be chosen.

Feedback from the custodians using the products was key to success. All 300 custodians came together for a professional development day to learn about green washing and the benefits of working with products that were green certified. With help from the new supplier, custodians also learned what products were replacing the old products and usage and are keenly sup-porting the changes made.


1. agree on what you plan to achieve. Be specific with ‘what, when and how.’

2. Build a team with stakeholder representation (i.e. management, custodial staff, purchasing, and school board trustee)

3. conduct baseline surveys that form a starting point from which to measure change/improvement. inventory your cleaning supplies, tools and equipment and appraise overall housekeeping quality, procedures, training, frequencies, problems, complaint records etc.

4. Develop a plan that outlines priorities and what needs to get done.

5. Get everyone on board and involved, gaining understanding of what, how and why things are being done. it is critical to find a ‘champion’ to help you sell your program.

6. acquire ‘green’ products and equipment.

7. Organize training on your new green products. the key to training is in small groups, conducted in the field with lots of ‘hands on’ instruction.

8. implement your new program. it is important to get things done, something/anything. look for and find an early success story to build on.

9. take and share the responsibility. ensure all stakeholders have a responsibility to support and sustain the new program.

10. communicate. Share progress consistently with all stakeholders. ask for feedback and respond to every question and suggestion. look for a ‘champion’ to be an example and ambassador of your program and successes.


finalist Going Green initiativeKawartha pine ridge District School Board

10 steps to becoming a “green” school boardcont’d from page 16


Most articles and books about leadership are writ-ten from the perspective of successful leaders, or those who either teach people how to be successful lead-

ers and write about traits of successful leaders. “A real leader faces the music, even when he doesn’t like the tune.” (Anon); “The most important quality in a leader is that of being acknowledged as such.” (Andre Maurois); and “Management is doing things right; leadership is doing the right things.” (Peter Drucker). The list of essential attributes – the way lead-ers think, feel and act – is endless. In fact, there are so many things that can be said about leadership, and leadership relates to so many things, that writing about leadership is a bit like writing about ‘life’ – it’s a big, amorphous topic.

It can sometimes be more useful to think about what leadership elements look like in a practical context rather than about what or who leaders are and how they got to be that way. I once worked with one of the world’s largest management

outsourcing and consulting companies where the governing belief was that everyone in the organization, at all levels of the organization, was a leader, either developing and emerg-ing, or de facto. Most of us fell into the former category, and those in the latter understood that, apart from generating the revenues that made everything else possible, their primary job was to nurture the environment that made becoming a leader achievable. Positional leadership – “I’m the boss so I call the shots” – had its place, but for the most part, leadership was defined as a set of qualities that can be taught and measured within the context in which those qualities were expressed, at all levels of the organization. As I think of it, leadership is not about producing great or charismatic personalities, but about deliberately growing people’s potential in ways that can pro-vide concrete answers to the questions: are we achieving the targeted results? Are we retaining our people? Are we serving our clients well?

procurement leadership in practiceweaving a web of relationships with purpose and direction

by Denis Chamberland


Indeed, different things are expected of individuals at dif-ferent places in every organization. What are some leadership features that can apply to, say, the director of Procurement and Logistics in a hospital, a municipality or any other type of organization? Below, in no particular order, are some ideas about how we can think of our role as procurement profession-als in our respective organizations. Many more ideas could be added.

Leaders’ obligations Like everyone else in the organization, leaders owe a duty to the organization – a duty to contribute to the financial and/or public policy success of the organization and to do what is necessary to ensure the future success of the organization. In procurement, this may mean nurturing relationships with suppliers and potential suppliers since they are an important source of the value to the organization – it is the leader’s job,

at every level, to enhance the value that is potentially avail-able in the marketplace for the benefit of the organization.

Although it is common to hear that people are leading organizations, that is of course inaccurate, since only people can be led. Because only people can do the things that need to be accomplished, people are the heart and soul of every organization. As such, leaders owe a duty to people, which can take many forms.

One way of leading is to capture the full complexity of the situation facing the group and articulating it in a clear and compelling way, not overly optimistically, not overly pessimistically. Simply capturing what is going on and presenting a grounded perspective gives a sense of common understanding of the purpose and goals to be accomplished. In a way, it is that grounded perspective that provides the sense of order upon which it becomes possible to aspire to excellence. A stable and predictable environment is one that accommodates change more easily, that allows for richer and more rewarding human relationships, and that makes people feel hopeful they can better participate in achieving their full potential.

Closely related to the above is the idea of accepting and encouraging different ideas, different perspectives within the organization. It is by sharing ideas with leaders who listen and hear that people give the best of themselves, by feeling valued, by sensing that their contribution is meaningful and special. There is the story of U.S. General Colin Powell who took a walk every afternoon around the military grounds, using the same path, to signal he was available to anyone who wanted to speak with him, and welcoming diverse ideas. Leaders, according to Powell, show concern for the efforts and challenges faced by underlings – even as they push for higher standards.

Given the fast-changing procurement environment in Canada, encouraging a diverse range of views becomes an opportunity – an opportunity to capture and re-define the job description of the modern procurement officer. The pur-chasing role of the past may have been focused primarily on administrative tasks, away from the more high-profile areas of program delivery. But there is now a need to transform the role into an important corporate management function, one which is both strategic and transactional, and contributes significant value to the organization. The opportunity to re-cast the role may be sharpest in Ontario where the provincial Ministry of Finance just released the initial edition of its Supply Chain Guideline, which is raising the bar on the way procurement is conducted in the province. Leadership means grasping the opportunity and participating in the process to influence the shape of things to come in procurement.

“Management is doing things right; leadership is doing the right things.”


Leaders provide momentumIf capturing the full complexity of the situation facing the group and articulating a clear and compelling direction is the role of leaders, so is creating a sense of momentum. Without momentum, there is the risk that all work will stall at contemplation.

Momentum is not a mere abstraction – it is a sense within a group that what they do together is interrelated and is progressing towards an objective that has been defined by the leader. It is a shared sense of purpose, which greatly surpasses the separate objectives of each individual within the group.

In an organization’s procurement group, momentum may be built around the group’s strategic objectives for the year, which need to be clear, measurable and well communicated. Only leaders can create the conditions necessary to gain momentum, and maintain it on a consistent basis.

Change – welcome or unwelcome – creates opportunities for building momentum. The recent e-Health Ontario debacle

in the province creates an opportunity for reform that can be harnessed, not just by those living under the spotlight, but by procurement professionals across the entire public sec-tor. Similarly, the release of the province’s new Supply Chain Guideline also becomes an opportunity to build momentum around the many new requirements that are being proposed to be implemented.

Leaders are accountable for being effectiveAs is noted in the quote from Peter Drucker earlier in this article, there is a difference between efficiency, which is to do things well, and effectiveness, which is to do the right things. Leaders must do the right things, but not all by themselves. The director of Procurement and Logistics may be account-able ultimately for the work of the group, but by recognizing the diverse talents of her team members, he/she can get the job done by reaching out and enabling others to reach their full potential for the benefit of the group, and the organization. The objective is to harness the talent that is available, not by focusing first on positions, but by recognizing individual inter-ests and strengths, wherever they may be in the group.

In the end, leadership may be more a weaving of relation-ships than anything else – a weaving with a sense of direction and momentum, which is clearly communicated, and focused on achieving measurable results.

denis Chamberland is a procurement law specialist with aird & Berlis LLP. He may be reached at [email protected].

“Leadership means grasping the opportunity and participating in the process....”

early in November, members of the Canadian Public Procurement Council met in Victoria for their annual forum. The pre-forum workshops drew a select number of

delegates and the concurrent sessions and plenary sessions held over the next three days were met with enthusiasm. Delegates peppered many presenters with questions and during the lively breakout sessions, shared their own experiences, challenges and solutions with each other. One such session was on the chal-lenges of rolling out the federal infrastructure funds as quickly as was being demanded. Changes in signing authority, process and staffing were all required in varying degrees and everyone had different ideas and solutions. Relationships between govern-ments at all levels needed tuning up so that everyone could take advantage of the economic stimulus.

At a special early morning event, the winners of the Leadership in Public Procurement Award and Leadership in Green Procurement were presented their awards by Summit magazine and the leadership award sponsor, BMO Financial Group. The winning submissions were described in greater detail at one of the morning sessions where delegates queried

the presenters on aspects of their submissions. BMO also had an opportunity to inform delegates of advances in their card services for the public sector.

As always, networking among the delegates is one of the strengths of the forum. One delegate told me that she had a challenge before her and did not know where to begin, but she met a delegate that had already been down that road and, not only would he share his documentation, he would personally help her work out her approach… now that is value for money from a conference! Some of the forum presentations are avail-able at http://cppcforumccmp.ca/program.php.

Victoria’s mild weather and the location of the conference cen-tre location in the heart of downtown did much to allow delegates to interact socially as well. The banquet evening in the Crystal Garden was a great success with Sutcliffe, a Beatles tribute band, encouraging several delegates to linger over coffee and to dance.

Delegates are now anticipating next year’s conference, which will be held in Ottawa in early October. Plans are already underway for a full and captivating program that will capitalize on the venue being our nation’s capital. Stay tuned.

CPPC BoARD oF DiRECtoRS 2009-2010KathLeen mUrettiPresidentteam leader, accounts payable, procurement and environmental Services, city of airdrie (aB)

John gaUvreaUvice PresidentDirecteur des investissements ministère de la Santé et des Services sociaux du Québec (Qc)

h. SCott WoLStenhoLmetreasurermanager, contracts and project management Service interuniversity Services inc. (halifax, NS)

ériC BLanChette-oUeLLetco-Secretaryagent de la gestion financière centre hospitalier universitaire de Québec Strategic Sourcing (Qc)

Brian SteWartco-SecretaryDirector, procurement & contract management university of alberta (edmonton, aB)

Ken S. BaBiChdirectorDirector purchasing Services Department university of Victoria (Bc)

meLinda nyChoLatChair forum 2010 and directorDefence construction canada (Ottawa, ON)

david LaWSondirector chief Shared Services fraser health (Surrey, Bc)

david KnightdirectorGovernment of Yukon

Jim niChoLSondirectorcity of calgary (aB)

CaroLine BognerdirectorDirector, procurement alberta infrastructure

anna maria magnifiCodirector executive Director Directrice générale internal trade Secretariat corp. (winnipeg, mB)

marK mCCULLoChdirectorSenior manager, procurement Government of Nunavut

Canadian Public Procurement Council Forum 2009by Summit staff

Photo: anne Phillips



Modes of negotiationYour choice …in person, phone or email

by Mark Trowbridge

Today’s procurement professionals often find themselves conducting negotiations in a variety of mediums.

Some complex negotiations take place in the same room as the supplier’s represen-tation (in team or individual forums). Other negotiations take place remotely via telephone or email. Each of these modes has unique variables that the procurement practitioner must consider…otherwise they may hand over an advantage to a skilled opponent.

mode 1 – negotiating “in person”Negotiations are generally most productive when conducted in person. This is because the participants have the advantage of both verbal and non-verbal indicators from the other party. And they do not suffer from the technical limitations (dis-cussed later) inherent in telephone or email communications. Factors that help make “in person” negotiations most beneficial include the following:

in-person team:• Group synergy – The benefit of team

negotiations is based upon the well-known principle that “The whole is greater than the sum of its parts.” More-simply stated, a group will usually make better decisions together than would any of the individuals who comprise the group, working alone. This is extremely true in negotiations, as a well-prepared team can almost always achieve better results than a sole negotiator.

• Strength in numbers – A team will nearly always have an advantage over a single opponent because different members of a negotiation team can play key roles that make their approach highly effective.

• In-person team negotiations are the optimal format for multi-element, high-value, and sole/single source negotiations.

• Team negotiations are particularly important when decisions must be made during the actual negotiation process. A team comprised of key stakeholders can use quick “caucus” or “breakout” discussions to make decisions that can immediately be re-introduced into the negotiation dynamic with the other party.

in-person individual:• Many of our negotiations are one-on-

one. This is especially true for standard procurement transactions. It’s just not practical to pull stakeholders out of business operations for standard negotiations. Having the procurement professional represent stakeholders in standard transactions optimizes staff time and resources.

• The downside to one-on-one negotiations is that the mode increases the responsibility of the sole negotiator for preparation, success, and failure.

• This format also may require greater communication time in advance (with stakeholders, internal customers, etc) to gain consensus.

• This format is inefficient for multiple changing negotiation issues, as it may take too long to communicate concessions with decision makers.

• Being the sole negotiator may put the buyer at a disadvantage if the supplier brings multiple negotiators.

mode 2 – negotiating “by phone”Many negotiations occur over the telephone, but it’s important for the procurement professional to remember that things happen more quickly on the phone (than in person). Small talk is minimized, and participants are more willing to take extreme positions. People are less inclined to take extreme positions in person. So be prepared! • You lose 80 percent of the

communication content (non-verbal) when speaking over the phone.

• Telephone negotiations make it very important to focus on everything said. A poor connection (i.e., cell phone) may further complicate the clarity of communication. Be ready to ask the other party to repeat themselves when they’ve said something critical. It is also a good idea to take notes, and confirm key discussion points via email to the other party.


• Conference calls allow the other party to have advisors in room on mute, etc. You may never know the other people are there.

• Conference call services also allow the host to record the conversation, sometimes without your knowledge. If that is a concern, use your own conference service and be the host.

• Don’t be caught by surprise by an unplanned phone call. Phone interaction allows the supplier to call you without an appointment. If a supplier phones you without warning, you may not be prepared to negotiate. Instead, ask them if a later time would be acceptable…and schedule a time that allows you to be prepared.

• However, calling a supplier by surprise can work to your advantage. The person who initiates the call is often at a distinct advantage. They have time to prepare, are not taken off guard, can prepare a checklist, and can organize support data and materials. You can also use the surprise to “set the agenda” and thus control the issues being discussed.

• Don’t multi-task while negotiating via phone!

mode 3 – negotiating “by email”Email is frequently used today to negotiate pricing and key points. Complicating this is the increased use of handheld communication devices such as Blackberrys and texting via cell phones, in which case the communications are often truncated significantly.• Email negotiations may go even faster

than those on the phone, because there is less “give and take.” The medium also makes interaction more “positional” because the parties are putting everything in writing. This means there is less ability to change your position once the other party has seen your position in writing.

• Email does allow exact details to be proposed and received with a good amount of certainty.

• Email allows the negotiator to bypass “gatekeepers” and allow you to interact directly with a decision maker.

• Email encourages prompt and direct response, and can be utilized 24/7.

• Some people get in trouble because they answer too quickly via email. This is especially true in the new “texting” universe. Don’t reply without thinking.

• An opponent who chooses to use email can be a clue that they’re not comfortable negotiating in person. They may also be escalating points to a senior decision maker before replying.

• Even more so than in phone negotiations, emails lose the advantage of both body language and auditory clues.

• You may technically have a legally-binding “contract” if you agree to something the other party offers in an email. That’s because a court can interpret a contract being formed by a written offer and acceptance.

• If things aren’t going well in an email exchange, pick up the phone to speak directly with the other party. Contentious subjects or complex elements are much-better handled in person.

• And lastly, always be aware that email communications may not be kept confidential (forwarding, bcc, etc).

mark trowbridge, CPsM, C.P.M. is a founding principal of strategic Procurement solutions, LLC. He regularly teaches workshops and seminars on the topic of negotiations. Visit his new website at www.strategicProcurementsolutions.com.

Leadership and - Summit Magazine: Canada's …€¦ · TerraChoice developed a list of six...

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