Training - Contract Management
Let’s be frank – contract management isn’t the most exciting aspect of procurement. After all, who likes paperwork and minutia? Most people don’t. For those in the earlier stage of their career understanding legal jargon can be daunting and negotiating the contract with the supplier, harder still. More experienced professionals might not have even been taught this core skill properly and, with a desire to focus on more exciting activities, try to steer clear of contracts whenever possible.
Robust contracts are a key tool to manage your suppliers and minimise risk. So, like them or loathe them, you need to be good at them. Following some simple steps and with a bit of practice, I’ll show you that contract management isn’t nearly as arduous as you might think.
If you’re a Head of Procurement or Procurement Director you might have different needs. Perhaps you’re unhappy with the low level of spend under contract, the poor accessibility of contracts or that the full contract value isn’t derived. As a Procurement Director I’ve had this challenge myself and have some god ideas of how to help you.
Training - Contract Management
Let’s be frank – contract management isn’t the most exciting aspect of procurement. After all, who likes paperwork and minutia? Most people don’t. For those in the earlier stage of their career understanding legal jargon can be daunting and negotiating the contract with the supplier, harder still. More experienced professionals might not have even been taught this core skill properly and, with a desire to focus on more exciting activities, try to steer clear of contracts whenever possible.
Robust contracts are a key tool to manage your suppliers and minimise risk. So, like them or loathe them, you need to be good at them. Following some simple steps and with a bit of practice, I’ll show you that contract management isn’t nearly as arduous as you might think.
If you’re a Head of Procurement or Procurement Director you might have different needs. Perhaps you’re unhappy with the low level of spend under contract, the poor accessibility of contracts or that the full contract value isn’t derived. As a Procurement Director I’ve had this challenge myself and have some god ideas of how to help you.
Course Prospectus
Intro
Serena Haines is a Senior Strategic Sourcing Manager in the Global Nuts Procurement Team at Mars Wrigley. If you’ve enjoyed a Snickers, peanut M&Ms or Galaxy Hazelnut, Serena will have made sure that there are plenty of lovely high-quality peanuts and hazelnuts to satisfy production. Over the last 18 months Serena and I have worked extensively on several initiatives at Mars and it’s been a pleasure learning more about her fantastic category. And if you thought a peanut is just a peanut (or is it a groundnut?), you'd be mistaken; there's much more to them than meets the eye.
If it wasn’t for Covid I’ve no doubt we’d have done the interview standing in a peanut field or hazelnut grove, but alas – as my geography teacher once said to our class at school when the minibus broke down prior to a day's fossil hunting at Charmouth Beach, “it’s an arm-chair field trip for us today!”
Did you find procurement or procurement find you?
I found procurement on day one of my career. It hadn’t really crossed my mind before, but I immediately clocked businesses need to buy; far more things than you ever really think of. I realised early on that procurement provides fantastic variety and the opportunity for some great exploration. I studied geography for my degree so it also plays to my interest in how the world works.
Procurement Adventurer®
Serena Haines
What is the biggest procurement achievement you have had?
At this moment it’s all too easy to reel off tangible wins like cost savings. But for me success can often be about what I do when things go wrong. Particularly when working with agricultural crops, volatility and unpredictability, due to the reliance on weather, constantly creates new challenges.
Meaningful relationships with suppliers are absolutely key. And when suppliers go out of their way to help you, I really know I’ve got it right professionally in terms of tasks and procedures as well as on a personal level to find solutions with a supplier in the face of adversity. This theme continues internally at Mars too. I’ve invested in some really strong relationships around the business and we have some excellent ambassadors to support the nut category – this means we get things done. An example of this was implementing a specification change. Although this seems simple on the surface, it had a number of implications through the supply chain that needed working through thoroughly with stakeholders.
What is your favourite procurement tool or technique?
There are two techniques that I love. The first is ‘style-flex’ – not what would typically come to mind for many when thinking about procurement – but it comes back to the earlier point I made about building strong and genuine relationships. Listening, adapting and understanding people is so important.
The second technique is the supply chain mapping we’ve been doing together this year. It’s been amazing to see how such a seemingly simple technique can unlock so much value. I could never have imagined the new details and opportunities you can discover from spending time unravelling the puzzle of an end-to-end supply chain.
The Snickers bar was first created in 1930 and named after the Mars Family's favourite horse
Of all the procurement skills which one did you find hardest to master?
Nobody can say they have fully mastered negotiation; it’s an art. You can do all the planning you like but when it comes to the negotiation you still need to think on your feet and adapt.
"Some people still think peanuts grow above ground like fruit hanging on bushes!"
How do you compare the sourcing of peanuts and hazelnuts?
Peanuts and hazelnuts are similar in that after harvest they are de-shelled, cleaned and roasted but the similarity ends there and, in truth, they are totally different. Hazelnuts grow on small trees or bushes and peanuts in the ground (hence their other name of ‘groundnut’) – this is still something that catches people out and I’ve had a few determined folk who’ve tried to convince me they grow above ground like fruit hanging on bushes!
Strictly speaking peanuts aren't a nut. They're actually classified as a grain-legume and as they have a high oil content, they are also an oil crop. Being a legume, they have excellent nitrogen fixing characteristics meaning they need much less fertilizer and are a great crop to have in rotation.
From first planting a hazelnut sapling to a meaningful crop is 7-9 years. Whereas the peanut takes 6 months from planting to harvesting. Peanuts like sandy soil and are grown in many countries like China, India, Argentina and America. Cultivation is done on a large scale and harvesting is done mechanically by tractor. Whereas hazelnuts are typically grown on much smaller plots and in some cases like Turkey, quite literally by villagers in their gardens. To give a feel of scale, the global crop for peanuts is 45MT pa compared to less than 1MT pa for hazelnuts.
You must have met some amazing farmers in your time. Tell us about them
You’re right – I have and it's one of the best bits of the job! It’s an honour to have insights into someone else’s world and I find almost all farmers are so passionate about their crops. Of course farming varies considerably around the World from larger scale farms in countries like Argentina and the US to smallholdings in Turkey. Before Covid, I went to an incredible place sourcing hazelnuts there. Whilst having tea with the farmer in their garden they shared with us that hazelnuts have been cultivated in Turkey since 1500 BC and the orchards are passed down through the family from generation to generation.
"One of the best bit about my job is meeting the amazing farmers who grow our materials"
How have you managed your suppliers given the Covid travel ban?
Nothing can replace face-to-face, spending time with our suppliers or standing in the middle of a field. But there is one expected positive to come out of the travel ban. I’ve switched from phoning suppliers to having video calls with them and this has forged strong long-distance relationships.
"Brexit and Covid have been a huge wake up call for the food industry"
Supply security is a hot topic given Brexit and Covid – what are you doing to secure supply of your materials?
Volatility and uncertainty are here to stay – whether it be from Covid, inter-country trade tensions or climate change. I think Brexit and Covid have been a huge wake up call for the whole food industry – businesses can’t just assume that all their materials are readily available to the high standards they need. Fortunately, Mars has been really proactive about supply security and we already had a robust programme underway to identify risks and then mitigate them. A couple of the most powerful tools have been supply chain mapping to spot where risks lie and then quantitative modelling to understand true material availability throughout the chain.
"Volatility and uncertainty are here to stay"
How do you see the Procurement profession evolving over the next 10 years?
As a procurement profession across all businesses, our emergence will continue. My hope is for the day when procurement is called a ‘growth’ function like sales and marketing. Procurement can unlock so much value from cost savings to re-invest in growth, to under-pinning expansion into new product areas and geographies. The procurement community has some things to fix though – how can we promote our amazing profession better? How can we come across as less dry? And how can the procurement industry qualifications be modernised? It’s very exciting times to be in procurement and I want to be part of shaping our future.
We've talked enough about work. What makes you tick outside work?
I love travelling and adventure. Spending time on my bike in the mountains is where I love to be most. We managed to make the most of this in 2020 by basing ourselves in the Alps for the Summer meaning cycling and exploring became a normal post-work thing to do! Thinking nuts one day and then climbing the Col de L'Iseran the next (a stunningly beautiful yet tough climb from Bourg Saint Maurice) felt like the perfect work-life balance. Having the freedom and flexibility to pursue your hobbies and work remotely is what makes Mars a fantastic and really supportive business to work for.
Rapid fire
Peanuts or Hazelnuts?
Peanuts
French Alps or Italian Dolimites?
French Alps
Maltesers or Celebrations?
Celebrations
Turkey or Argentina?
Turkey
Lake or Sea?
Lake
