“I don’t feel forced, and I know I have the power to say no, but that isn’t the same as being in charge.”
― Kate Elizabeth Russell, My Dark Vanessa
Lab Manager: “ I want to place an order for an Acme pipette.".
Purchasing: “You realize that an Acme pipette is nearly twice as expensive as other similar pipettes. Would you consider something that might save us some money?
Lab Manager: “We are the experts in the lab and if we say we want an Acme pipette, we expect you to place an order for an Acme pipet. Purchasing doesn’t know anything about what goes on in our lab and you should never question our judgement.”
Interactions like this have been going on in labs since Louis Pasteur’s time. In the vast majority of cases, the Lab Manager prevails. Lab Managers, in cooperation with sales representatives, have been writing “lock out specifications” to submit to purchasing to circumvent the competitive bidding process for decades. Sales reps hand out these lock-out specs like candy at a parade.
So where does this tug-o-war stand today? Purchasing (having undergone numerous name changes over the years from “Materials Management” to “Purchasing” to Procurement” and beyond…) in most cases have surrendered. Where testing IS the billable product (e.g., at reference labs) and where the cost of lab supplies and equipment is a high percentage of their spend, Procurement’s decision prevails.
In most other cases, such as labs performing QC for a manufacturing operation, Procurement’s focus is on “direct spend” items (e.g., raw materials) and “indirect spend” is fully delegated to the Lab Manager.
What has not changed is that every organization, small or large, has a person or a group (e.g., Head Researcher, CEO or COO) who is responsible for its fiscal health. Cost saving initiatives fall on everyone under them. To meet cost saving goals, something must change. You can’t meet those goals fighting the same old tug-o-war.
Resolution to War Story #3
As you may recall, Don S. and Hank H. had switched all their business to my competitor, who had promised a Sunfish sailboat in return for switching the business. I had protested to Purchasing who, as you saw in the paragraph above, surrendered.
I felt that my only option was to escalate my problem within their organization. I needed to find that person who had fiscal responsibility. It was merely a question of how high on the corporate ladder I should go?
While I was considering my options, I was called by the Clinical Pathologist (the ultimate authority in the lab) who was interested in a new microscope. We had never met before. When I showed up for the appointment, I got some really nasty looks from Don and Hank on my way to the pathologist’s office.
My visit with the pathologist was going great so I decided to ask him if, in order to get him to buy this microscope, I would need to buy him a sailboat, or some other preferred item. This conversation starter led to my disclosure of what was going on in his lab with Don and Hank. He had steam coming out of his ears!
The risk here was that Don and Hank would hold a huge grudge for my ratting them out to the boss. Apparently that base was covered because they never raised the issue of a bribe again and I got all the business back the next week.
The Sales Pitch
Does your lab have cost saving goals? Is your current supplier helping you meet your objectives? We stand ready to help. It doesn’t take a complete change of vendors! The Pareto Principle always applies: You spend 80% of your lab’s budget on 20% of the items. If you focus your attention there, you can achieve your cost saving objectives. What does it cost for LPS to help you? Just a little time - schedule a consultation today!
