SURVEY: SME procurement practices with innovative suppliers

SURVEY & ROUND-TABLE DISCUSSION 

Please forward this blog to your business relations interested in the research.

Interested in doing the survey first: click here
Interested in the AUT round-table discussion (24 JUNE):  click for more info

Procurement in innovative or entrepreneurial (SME) companies is different in two ways. It is certainly different from large-firm procurement (purchasing) but it also seems different from procurement in traditional SMEs. Large-firm procurement often focuses on cost-cutting and business continuity with specialised procurement professionals and formalized processes. There are heaps of good procurement guidelines (text books, blogs and best practices) to help us there.

SME PROCUREMENT

BUT: an SME (1-250 employees) is not a dwarfed-down version of a large organization (Welsh & White, 1981). This seems obvious from the Figure below (Nicolas, 2011), but is not so obvious when we need specific guidelines on SME procurement practices.    

Our Dutch research at Hanze University on mainstream (more traditional; Reboud, 2011) SMEs suggests that SMEs exhibit a sales-driven approach when they procure their key goods or services, Despite the huge variety of SMEs (e.g. Meijaard, 2005) our research confirms that SME procurement processes are often more informal and centred round the owner's attitude and experience (e.g. James, 2012). We have identified a number of critical practices which have been discussed at procurement and entrepreneurship conferences in Australia and Europe. We are currently developing procurement tools together with a number of Dutch SMEs.

My NZ PhD research would suggest that innovative construction SMEs go one step further. These SMEs have an entrepreneurial approach to procurement and seem to treat key suppliers similar to their customers. They manage supplier risks, and pursue supplier opportunities as they would pursue opportunities with new customers. These innovative SMEs seem to neutralize their famous "liability of smallness". They scan their supplier markets and interact with large overseas companies to introduce radical innovations into the industry. Again, this all may seem obvious. But there is no website or textbook discussing such entrepreneurial procurement practices. We must know more, so that companies can benefit.

SURVEY ...

That is why AUT will survey entrepreneurial (or innovative) firms interacting with innovative suppliers on green-tech construction innovations. Via the survey we need 100 responses from for example members of PrefabNZ  or NZGBC, or other companies & professionals who work with innovative suppliers. My focus is on companies with less than 250 employees that are active in the construction industry (either new-build, facilities management, or retrofit).

The survey runs from 18 April. Please on this link if you want to participate. We will draw 5 respondents who receive a hard-copy of the Business Model Generation handbook. Check the preview if you’re interested!  
Survey results are confidential and cannot be related to you or your company. 
Participation is voluntarily. All participants can receive anonymised survey results. 

... ROUND-TABLE DISCUSSION
To learn more on this topic, we organise an industry round-table discussion on Friday morning, the 24th of June. If you are interested, please give name & email. We will again draw 5 participants for the famous Business Model Generation handbook. We will use the world-cafe method as advocated by Schiele e.a (2011) and Hoffmann (2012). This method stimulates discussion and brings good results for participants. 

HOW FIRMS WILL BENEFIT

Last week I attended a PrefabNZ conference here at AUT. New Zealand has clever and innovative construction companies. 

A large part of the value created for customers can be procured from suppliers (e.g. Van Weele, 2010; Staal & Walhof, 2014). Construction innovations are expensive and risky and companies can benefit from best-practices with innovative suppliers. The survey and round-table discussion are excellent means of developing and sharing procurement practices with the industry. 

Last year, I published a 4-page article on the role of green suppliers: Get your Green Suppliers on Board. It described findings from a workshop with 20-odd Facilities Management professionals, and has so far resulted in 100+ downloads. Likewise, I will publish on this PhD research via New Zealand blogs, websites and newsletters. Keep following this blog for updates.

As usual, you are welcome to email your suggestions & questions. They really help. 

TXS in advance, Anne

Interested in doing the survey: click here

Interested in the AUT round-table discussion (24 JUNE):  click for more info