To ‘Preferred Supplier List’ or Not To ‘Preferred Supplier List’

That is the question.

Pardon my abuse of the English language for the post title.

But the good people over at the Procurement Leaders got me thinking today with an article on this very topic: The Pros and Cons of Preferred Supplier Lists.

The article is centered on the use of preferred supplier lists as it relates to consultancy services. The point being debated is: do the preferred supplier lists mandated by procurement lessen the agility and fast moving creativity of the consultancy world?

What if you find a company with just the perfect idea but you can’t use them? Ooops, not on the list.

Ok, I get the point, and it is valid.

But this paragraph makes my Procurement Hero’s hair turn white:

“…consulting firms are trying to bypass the lists through the use of ‘thought leadership’ tactics… The plan: persuade buyers’ internal clients to waive the requirement to use consultants on preferred supplier lists in order to gain access to the demonstrated expertise and thinking.”

Yeah, and now my hackles are up.

I am willing to entertain a conversation about the use of preferred supplier lists, about whittling down the number of suppliers used, about maybe the preferred supplier list doesn’t always serve the best interests of the end users, about exceptions to the preferred supplier list.

But prospective suppliers who can’t make it onto the preferred supplier list ACTIVELY trying to go around procurement and convincing end users to choose them over others?

Um. No.

No.

Very much. No.

That makes me want to start up a disbarred supplier list and add every consulting company who has pulled this little stunt to the list.

How that’s for “thought leadership”, you sneaky b***ards!?

Ok. Let me step outside and take a couple minutes to compose myself.

Ahem.

So here’s the thing. I think that preferred supplier lists have value. They provide a gateway to be sure you are keeping your supplier base managed and under control.

Managed suppliers means managed costs.

Procurement has to walk that fine line of making the bar to entry high enough so it’s not an automatic to be added to the list, but low enough to allow flexibility and additions to happen efficiently.

I’d say to these “thought leaders” that they should be working WITH the procurement organization and not against it in order to get on the preferred supplier list.

If they are a good, trustworthy and value added company, it shouldn’t be that hard.

If they are a sneaky, underhanded kind of company that goes around procurement every chance they get, it should be damn near impossible to get on the list.

And that’s all I have to say about that….