The Decline of the Negotiator?

Damon Francis -- Purchasing, 8/24/2000

As the number of people buying online continues to grow exponentially, certain issues arise for purchasing professionals who have traditionally prided themselves on their people skills. The ability to manipulate negotiations may have taken a backseat, especially in repetitive, low-cost transactions dealing with high volumes. Kevin Rohan, a purchasing specialist at JP Cannon Associates in New York, says that in these situations, e-procurement solutions are currently the most effective in eliminating transaction costs.

"Being a strong negotiator is not enough in today's market. Candidates need to continue to develop their skills and be familiar with the latest technology such as how to utilize the Internet, market changes, and strategic planning and client development. Buying the product at the lowest price is no longer the way business is conducted," says Donna McMillan, president of McMillan Associates in Melbourne, Fla.

While the Internet forces the purchasing job market to evolve, opportunities for purchasing professionals willing to embrace the e-procurement hysteria continue to grow as well. McMillan notes that, "the purchasing market is the strongest we have seen in years. One reason seems to be that companies are becoming more sophisticated in the way they conduct business and are looking for candidates with strong computer skills and exposure to e-commerce."

"The positions everybody is trying to fill right now are e-procurement related," says Alex Metz, president of Hunt Ltd. in Lyndhurst, N.J.

Does this widespread acceptance of e-procurement and technology into the framework of the purchasing industry indicate an abandonment of the tried and true method of purchasing negotiation? There is concern that e-procurement will move beyond items like office supplies and MRO and into transactions that are perhaps less repetitive and of lower volumes. The transaction costs associated with the purchasing, handling and storing of MRO, like mops and drill bits, can be reduced substantially by e-procurement/e-commerce solutions, so naturally questions arise as to the limit of the Internet's ability to dominate other markets.

Reality

The chances that e-procurement will completely replace one-on-one negotiation in the near future is slim. Important, however, is the extent to which professionals wary of the trend in e-procurement will be left behind. E-procurement has forced a compromise between the "old" and "new" schools of purchasing ideology. The purchase of goods and services online is clearly not just a temporary phenomenon. A priority for purchasing professionals who still want to be around in the year 2005 should be to keep abreast of developments in the electronics industry, the business world, and the purchasing profession in general, because e-procurement will undoubtedly be making headlines in all three. According to McMillan, "One of the most important skill characteristics of any purchasing professional is that they continue to study and learn about their profession. Take business-related courses and attend seminars. Subscribe to and read business publications. Join your local chapter of NAPM and work toward achieving your C.P.M."

Emery J. Zobro, president of the John Michael Personnel Group Inc. in Chattanooga, Tenn., is confident that while the characteristics of a successful purchasing professional might be changing, there are certain qualities that will survive e-procurement's infiltration of the industry. While he recognizes that, "In five years a person who hasn't established a track record with e-commerce and e-procurement will definitely be left behind," he remains firm in the assessment that, "buying things over the computer will never take the place of one-on-one negotiations."