Outcomes, along with stakeholder-buyer-supply relationships, occupy rarefied ground. They are the backbone of a procurement and the performance of a contract to satisfy beneficiaries needs. Collectively they set the direction of travel that everything else has to follow. They are, by definition, a consequence or a result; more specifically what constitutes success.
They communicate what, and why, you expect to achieve from the performance of a contract. This must not be just what you expect a supplier’s performance to achieve. The performance of a contract isn’t, or rather it shouldn’t be, a solo act conducted by a dictator. It involves a buyer, a supplier, supply chains, beneficiaries, stakeholders, influencers and all the rest.
How the performance of a contract satisfies these outcomes is predominately the responsibility of potential suppliers and then ultimately the supplier to whom you award a contract. Predominately because, inevitably, context and circumstances are likely to impose constraints on how a supplier can perform a contract.
Responsibility for how should weighs more heavily on suppliers because they supply more often than buyers buy; they have more and more relevant experience and expertise, they are the ‘experts’. Outcomes allow them to deploy all of this relevant experience and expertise.
Therefore, I propose a simple rule of thumb; buyers are responsible for what and why with potential suppliers responsible for how to achieve this.
Outcomes must …
Outcomes must describe what ‘satisfying beneficiaries needs sustainably, in particular those of the primary beneficiaries,’ looks like. At the very least that is what the performance of a contract must achieve, for you to even start to consider if it has been successful.
For example, you may, when you make peer comparisons, have spent next to nothing and been carbon positive. But if you didn’t satisfy the needs of the primary beneficiaries that triggered the procurement and award of the contract then you’ve failed. Yes, there are degrees of failure and success, but still ….
To be effective each of your outcomes should:
- Describe what is to be achieved/experienced
- Make it easy to see when they’ve been achieved
- Communicate with unambiguous clarity
- Enable a common understanding
- Motivate the best potential suppliers
- Align interests and expectations
- Avoid limiting mutually beneficial value
- Underpin the performance framework
- Avoid unintentional adverse consequences
Then there is the collective dimension. If you think you need more than six to eight overarching outcomes for a procurement then have a rethink. It is likely you are over thinking and/or at too low a level of detail. You could also be trying to satisfy too many vested interests. Anymore than six to eight and you risk diluting the impact.
Responsibility is individual and joint
Don’t, as many do, leap to the conclusion that outcomes are solely for suppliers to achieve. Supply contracts have at least two direct and a multitude of indirect parties, all of whom have varying degrees of influence. Therefore, the performance of a contract relies on an effective confluence of individual and joint intertwined responsibilities.
Bluntly, you won’t achieve anything near what could be possible if you absolve yourself of responsibility by sitting back and making a supplier wholly responsible. Outcomes are a joint undertaking, as is the performance of a contract, they confer individual and joint responsibilities on all parties.
Formulating effective outcomes
Whilst this is all sensible stuff it doesn’t explain how you formulate outcomes. Practically, each outcome should be:
- No more than a line of text
- Written in the past tense
- What beneficiaries will experience
- Succinct, straightforward and memorable
- Supported by concise explanatory text
- Quick to read and easy to understand
- As specific and definite as possible
- Open, not closed
To help you put this into practice these are some example outcomes. Ideally, you would tailor them, for your performance framework and to suit your specific circumstances.
Here is a straightforward generic example.
Improved climate resilience: local native species rich grassland wildflowers thrived in low nutrient soil, and changes/additions to hard and soft landscaping increased the sponge effect.
This second example illustrates the difference between an open and closed outcome.
Increased biodiversity: does not self limit mutually beneficial value, although you’d do well to include a minimum increase, above a baseline or the biodiversity of a similar environment or both, in your performance framework.
Increased biodiversity by 20%: self limits mutually beneficial value, why go beyond 20% even if, with little additional effort or cost, there is potential to increase biodiversity by more than 40% .
The third example uses inclusive language and explicitly covers a supplier’s specific interests, such as profit and cost to supply.
Valuable, profitable and effective commercial working relationship: aligned interests and expectations, and collaborative relationships, for buyer, supplier and respective supply chains, achieved the other outcomes and this outcome to a degree well beyond the sum of respective contributions.
You can also use outcomes to …
Ask tender questions. That is you could ask potential suppliers, to include in their tenders, how they would achieve each of your outcomes. It doesn’t get more direct or specific than this, as achieving your outcomes is the point of a procurement and performance of a subsequent contract.
Form the fundamental building blocks of a performance framework, as the performance of your contract should be wholly geared towards achieving your outcomes. The framework should have a variety of measures, often three or four for each outcome, to track progress and determine when and to what degree each outcome has been and is being achieved.
To start …
Start with what primary beneficiaries must have experienced to consider their needs satisfied. Ideally you would do this by asking, and/or observing, them directly. Then move on to suppliers, yours and others. Collate, distill and analyse what you learn. Use this to formulate a range of statements on outcomes, expectations and constraints. I’d suggest doing this as a group with an independent facilitator.
Next test your drafts with primary beneficiaries. Then start applying constraints that will or are likely to arise, often because you have to also satisfy other beneficiaries needs, such as Budget Holders and the Finance Director. For example, you can’t spend more than you’ve got, at least not without consequences.
When you’re a bit further on consider testing your drafts with potential suppliers. Be careful to avoid any adverse perceptions of bias or unfair advantage. Do this in-person, if you can, and be specific and definite about what you want to get out of it. However, and more importantly, you must be clear how potential suppliers will benefit if they take part.
One last tip, maximise your potential by going back to fundamentals. If you don’t then the best you’re likely to achieve is incremental improvement because you will self-impose the constraints of current results on what you can and cannot achieve in the future. I’ve reused a previous example outcome to illustrate this.
Increased biodiversity: local native species rich grassland wildflowers thrived in low nutrient soil, which attracted and increased the diversity and quantity of wildlife.
The fundamentals here are ‘local native species’ and ‘low nutrient soil’. That is because local native species rich grassland wildflowers grow more slowly and the roots deeper, even more so in soil with less nutrients. This slower growth equates to fewer inputs, because it doesn’t need to be cut as often, which also means native grassland wildflowers are around for longer to attract more wildlife of a wider diversity.
If you start with trying to improve on ‘what happens now’ you’re likely to consider reducing the number of cuts to 11 from 13 as a good improvement. In a similar vein perhaps you’ll consider using weedkiller to kill off swaths of grassland, then plow it and sow non-native generic and expensive, so-called, wildflower seed. This actually happens, and it’s far too widely thought to lead to a climate busting success. Yet it releases carbon into the environment (increasing your carbon footprint), reduces climate resilience and self-limits bio-diversity. Oh, to maintain this, because you’ve sown annual non-native pseudo wildflowers, you’re on the hook to do this every year, unless of course you’re relying on self-seeding. Bad move! However, this actually does happen, and all because they didn’t start with the fundamentals.
And finally …
Done well, outcomes are hugely powerful and extremely effective. Good suppliers like outcomes because they show respect suppliers experience and expertise. Outcomes enable and motivate the best suppliers to deploy all their capability and return their best offer through their tender, because mediocre suppliers have nowhere to hide. Contract awards are perceived to rely more on capability than something more akin to a lottery.
Outcomes cut through the unrelenting cacophony of detail to give a clear backbone and a singular common understanding and direction to your procurement and the performance of your contract. They, along with working relationships, are the most important enablers to realise the full potential for all parties from the performance of a contract.