Kavita Cooper says charities should use the quieter summer months to prepare for busier times ahead.

It’s summer already, let’s not waste it. There is a huge opportunity for charities to use the quieter summer months to focus on goals and actions to improve their bottom line.

Charities can take this time to work cross-functionally with finance and key stakeholders in preparation for the autumn and winter, with fundraising events and many organisations reaching year end, these can be busier times. Getting ahead of the game and looking at existing procurement processes and activities in a little more depth will help identify and deliver both quick tactical wins and longer term strategic benefit. In other words, take the opportunity to start fundfinding by turning bottom line improvements into investment.

Where should charities begin?

Setting up a procurement strategy is often on the to-do list, but rarely given enough priority. A simple, confidently implemented strategy, will deliver early bottom line savings that you can measure. Having a strategy simultaneously instils trustees and donors with confidence that value for money is achieved. We have found this approach attracts more donors and, at a time when charitable organisations are concerned about funding and transparency over how money is spent, this is a must.

So make it a priority.

Set up, implementation and training

There are three important stages in creating a procurement strategy.

Set Up

• Define a procurement strategy and make sure this aligns with your organisation’s objectives. Involve key stakeholders in the brainstorming and delivery of how the charity should be buying and spending better
• Data is key and it’s important that spend information is extracted from finance systems and analysed. This will offer the understanding and insights necessary to interpret the expenditure, as well as identifying what percentage of your annual spending is on contracts and suppliers
• Locate existing contracts to set up a contract management system; this is key to getting organised and can be as straightforward as a spreadsheet.
• Make sure everyone within an organisation knows where to look. NB. If contracts for key suppliers don’t exist, put this on the risk register and action immediately  
• Create and publish policies with templates that include: Responsible procurement policy and a standard ordering process
• Ideally recruit a procurement lead/team, but smaller organisations will probably simply need to identify someone responsible for the procurement practice.

Once there is agreement with stakeholders, the procurement strategy, along with policies, should be widely published within the charity and employees must be empowered with it. The more people who have an understanding the easier it will be to implement. 

Implementation

Take your key stakeholders on the procurement journey and demonstrate:

• How the strategy meets with compliance and governance – internal & regulatory
• How suppliers are managed
• How performance is monitored
• How the organisation and will benefit beneficiary

Most importantly show how to earn some quick wins to get savings via the new more structured approach you have taken.

Now is also the time to recruit or identify and train a procurement person within the organisation, for them to own the process going forward. Again this does not necessarily need to be a dedicated role, simply having someone with the responsibility will begin holding accountability in the supply chain.

Training

When the strategy works, don’t keep it to yourself! Train everyone, including non-procurement volunteers and stakeholders. Take them on the procurement journey.

As Zig Ziglar, motivational speaker, said: “The only thing worse than training employees and losing them, is not training them and keeping them!”

Make sure:

• There is a centralised and managed process for all supplier contracts
• That templates are easy to access and use.
• There is a training process for existing and new volunteers/stakeholders

This isn’t the end of the procurement journey for charities and continuous improvement of the procurement strategy will be needed, particularly as the charity grows. But having a strategy in place will reap immediate rewards compared to having none at all.

Kavita Cooper is the founder and chief executive of Novo K
Civil Society Media would like to thank Novo K for their support with this article