Ask any sales guy and they’ll tell you the same thing. By the time a new solution reaches procurement, in 75 to 80% of cases there is already one vendor lined up to win it. The product owner has been in conversation for months, the discovery happened, the POC ran, the champion is briefed.
We arrive after that and open the template.
I don’t believe in fairness in this, by the way. Not in business. So the question isn’t how do we run a fair process, it’s whether the process we’re running is doing anything at all.
The defence mechanism
Here’s what usually happens. Spend is high, procurement wasn’t involved early, the business says it needs to move fast, and the head of procurement looks at the number and thinks this is just not all right to buy without testing.
So we run a light RFP. Something comparable, just to see whether that price is anywhere near reasonable.
Then we ask the budget owner to help us draft the requirements. And what does that person do? He calls his sales guy and asks for help. Let’s just tailor this.
I’m not saying that’s right or wrong, it’s how it is, and it’s usually tied to the maturity level of the procurement function in that organisation. At the higher maturity levels the team is already in the room, already screening alternatives in parallel before anyone has quoted anything. Most of us are not there. So we play by the process and the process becomes a way to cover ourselves.
and when process becomes your product, something is not right.
I’ll be honest that in over a decade of this I cannot recall a challenger coming in late and actually winning. Why would they. There’s a POC already run, work already done, integration already scoped, and reviewing a new option properly takes another 3 months nobody has. Best case we use the challenger’s number as leverage and get something out of the deal. That’s it. And the good seller knows this, they stand on their ROI case and they hold the price, and they are usually right to.
What real competition costs
Real competition is possible. It’s just a lot of work, and this is the part that gets skipped.
It needs deep market research and credible alternatives you have actually called, not names off a Gartner grid. It needs a genuine willingness to switch, which means the business has to be prepared to live with the second option. And it needs time. Not 3 months before renewal. Sometimes not even 6.
It also needs a story. Why are we running this, why do we want you in it, what does the winner actually get. Vendors can smell fake competition instantly, and if you burn them they don’t come back. We ran yearly pitches in marketing once and by the second cycle nobody serious wanted to take part, which is fair enough, I wouldn’t have either.
The flip side is worth saying: even a vendor who loses gets something real out of a proper process. They find out who they’re up against, where their features and price actually sit, what a serious buyer thinks of them. That’s worth their time, and if we can’t articulate that, we probably don’t have a competitive event, we have a paperwork exercise.
Where the leverage actually sits
Not at the renewal. 3 places, all earlier.
Alignment. If the business hasn’t agreed we’re doing this and doesn’t see the point, sales calls the champion, the champion says don’t worry, let procurement run their event, and there’s nothing behind our process. No alignment, no leverage.
Scope. Whoever controls the requirement controls the optionality. It’s like a TV package, you get 60 channels and you watch the football. If we’re paying for modules and tiers nobody uses because the requirement was written around one vendor’s feature list, the negotiation was lost at the definition stage.
Vendor shaping. A lot of teams run this transactionally, no contact with procurement, respect the deadlines, submit by Friday. There’s a place for that in public procurement and regulated categories, for good reasons. Everywhere else, if we never talk to the vendors we never find out what they actually want out of this, and that information is most of the negotiation.
For the CFO conversation: the cost of arriving late is not the difference between quote 1 and quote 2, it’s a multi-year recurring commitment signed at a price that was never genuinely tested. That number is usually much larger than the saving we reported on it.
The honest version
None of this makes procurement popular in the short term. Getting in earlier means asking, on the next request that lands, what was already decided before this reached me and who decided it, and people don’t love that question.
But if we’re not there to help the company spend well, then what are we doing.
Build the market view first. Earn the right to run the event.
This one came out of a conversation with Sam Jenks on Kodiak Hub’s podcast The Way We Source, ep. 66. Sam spends the second half arguing the seller’s side properly, which is the useful part, bc he’s right that a good salesperson holds their price and most of our leverage is imaginary. 49 minutes. We ran out of time before finishing, so there may be a part 2..
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