20 November 2014 Steve Butcher, Head of Procurement and Shared Services
Take a look at these questions and think for a few seconds about each answer:
Now consider how different your answers might have been 10 years ago. Over the higher education sector as a whole, there have been definite improvements. During the last decade, procurement staff in HEIs have contributed significantly to the efficiency targets set by successive governments. The growth of e-marketplaces and the influence and impact of procurement advice have produced continual improvements which have been reported to the Department of Business, Innovation and Skills and the Treasury. And now the Diamond Review is setting the challenge of delivering 30% of non-pay spend through collaborative contracts.
As the focus on institutional procurement sharpens, procurement staff must understand that they will be valued most if they can help steer an institution through the waters of procurement to reach a desired destination, rather than advising that the journey is too perilous and must not be attempted. There is a view that procurement staff are here to say, ‘Rules must be obeyed.’ A better contribution would be to say, ‘Rules must be understood and risks managed.’
Consider this scenario…
For every 100 unique visitors to a faculty web-page, only seven fill in and submit an application for study.
Some of the 93 are not visiting to make an application, but the significant proportion who are drop out for a myriad of reasons.
Doubling the number of visitors who complete the application process could double the number of offers and enrolments.
However, reducing the ‘wastage’ from 93% to 92% would result in eight applications (a 14% increase on seven). Think of the income this could generate for your institution!
This scenario is presented to you in a briefing by a head of marketing, a director of finance and a faculty dean. They go on to suggest a possible approach:
Live web chat involves a user typing in a ‘chat box’ to interact with another user. This can be an agent who answers their questions professionally.
This technology is being used by more and more companies to move web-site visitors through the sales chain and to reduce ‘shopping cart abandonment’. BT reports that 23% of its sales now involve the use of web chat.
Web chat is a refinement of the call centre concept – it could be more accurately termed a ‘response centre’, as it only responds when a website visitor asks for assistance. Like a vampire (but far more benevolent!), it doesn’t interfere with people’s lives unless it has been invited in.
Web chat at these centres is a more efficient business model than that of telephone call centres. Web chat operators can deal with five to eight open chats at one time, whereas a voice caller has to be answered on a one-to-one basis.
Live web chat is not only being used by companies; universities around the world are doing the same. UK higher education institutions must follow this trend, to retain market share but also – if they do it well – to increase it.
What do you say in response?
A typical reply from a procurement team would be: ‘What is the likely cost? This is likely to be above the EU limit, especially if we do this over a number of years. So put a specification together, and I’ll wrap it around with the standard terms which must go in a tender, and we’ll advertise it through the European Journal.’
This is the safe response, but it ignores an important issue: no single contractor can provide all the services required to enable live web chat. In addition to the call centre, there is a need to train external staff so that they represent the institution favourably. At some point down the ‘funnel’ from visitors to application, it would be best for informed institution staff to take over the relationship with a potential student; these staff also need to be trained. Some business process mapping needs to happen so that all parties understand their roles and responsibilities, especially at the crossover back to the institution. The institution needs a relationship manager who can manage the service from the institution’s end. (This is beyond contract management: if the institution does not deliver on its part of the service, the service will fail to deliver.) Some ICT adjustments will be needed for the web chat technology to work and maybe to feed into existing Customer Relations Management systems – but this is certainly not an ICT-led project. It requires a marketing-led project which includes ICT, Registry, Finance, Faculty and School staff, plus close liaison with a third-party Response Centre. And there may well be other factors specific to particular institutional circumstances.
So where does the procurement team fit into all of this? There’s no easy answer – but a new service of the type described above, which requires partnering rather than contracting, does not fit in to the traditional ‘spec it, tender it, contract it, manage it’ view of the world prevalent among procurement staff.
So – if somebody came to you with a serious proposal that could add at least 15% to the number of good quality applications to your institution, what would you do to make it happen?