Overcoming Combative Procurement: Why Collaboration Wins Contracts

Traditional procurement often carries a legacy of combative, adversarial negotiations. However, this win-lose mindset is increasingly outdated and detrimental to long-term business objectives.

Tim Harvey, Procurement Manager at CompSource Mutual Insurance Company, recently discussed his personal transformation on Gatekeeper’s Procurement Reimagined podcast, highlighting how adopting a collaborative approach dramatically improved procurement outcomes.

 

The Hidden Costs of Combative Procurement

Early in his career, Tim adopted a common yet problematic approach: treating procurement as a zero-sum game.

He candidly admitted, “I approached my suppliers, bidders, everything, with an almost combative, us-against-them mentality.” Initially, this stance seemed beneficial, driving down immediate costs and asserting procurement’s authority.

However, Tim soon discovered significant drawbacks, including a narrowing pool of suppliers and diminished competitive tension, which ultimately harmed procurement effectiveness and increased organisational risk.

Tim explained how such a confrontational approach discouraged supplier engagement, limiting bids to a small, repetitive group. This not only reduced options but also stifled innovation and strategic value from supplier partnerships.

CFOs and procurement leaders alike recognise that a narrow supplier base significantly heightens operational vulnerabilities.

Why CFOs Should Champion Collaborative Procurement

CFOs have a critical stake in ensuring procurement delivers sustained organisational value - not just short-term savings.

Combative procurement may yield immediate, measurable wins, but it often neglects long-term strategic implications.

Collaboration, on the other hand, facilitates comprehensive cost management, ensures better risk control, and unlocks vendors' innovation potential.

By shifting to a collaborative procurement model, businesses can achieve higher-quality outcomes, greater operational resilience, and enhanced strategic flexibility. These are all critical advantages that directly align with CFOs’ broader financial objectives.

How to Build A collaborative procurement process

Procurement teams looking to transition away from adversarial methods can take clear, actionable steps:

• Regular Vendor Check-ins: Schedule structured and frequent conversations with key vendors to build trust, clarify expectations, and proactively resolve issues.
• Joint Problem-Solving Sessions: Actively engage vendors in workshops or meetings to co-create solutions and leverage their expertise in tackling procurement challenges.
• Holistic Vendor Evaluations: Develop procurement frameworks that evaluate vendors on criteria beyond price, incorporating measures of reliability, service quality, innovation capability, and risk management.
• Digital Procurement Tools: Adopt a vendor and contract management platform like Gatekeeper to automate workflows, enhance transparency, simplify compliance, and facilitate real-time supplier communication.
• Training and Development: Invest in procurement team training focused on relationship management and strategic negotiation skills, ensuring the team can effectively implement a collaborative approach.

What are the benefits of collaborative procurement?

Collaborative procurement is a strategic enabler that can unlock value across the entire business.

By fostering mutual respect and open communication with vendors, organisations can realise a host of tangible and intangible benefits that extend far beyond initial cost savings.

1. Reduced Total Cost of Ownership (TCO): Collaborative vendor relationships often result in greater transparency around pricing structures, hidden costs, and long-term value. Vendors are more inclined to offer bundled services, extended warranties, or cost-reduction suggestions when they feel part of the solution - not under siege.

2. Improved Risk Management: When procurement teams and vendors work together, potential risks can be identified and mitigated earlier. Whether it’s supply chain disruptions, compliance gaps, or contractual ambiguities, a collaborative approach ensures all parties are aligned in navigating challenges before they escalate.

3. Accelerated Innovation: Vendors are often closest to the market, with unique insights into emerging technologies, trends, and process improvements. A collaborative procurement model encourages them to share innovations that benefit both parties, leading to more agile, forward-thinking solutions.

4. Greater Vendor Commitment: Vendors engaged through partnership rather than pressure are more likely to go the extra mile. This includes prioritising your business in times of scarcity, customising services, or offering enhanced support - all of which improve delivery outcomes and reduce operational friction.

5. Stronger ESG Outcomes: Collaboration creates space for meaningful dialogue on ethical sourcing, sustainability goals, and diversity targets. It transforms ESG conversations from compliance checkboxes into strategic, measurable initiatives that suppliers can support and even help shape.

6. Enhanced Organisational Reputation: Companies known for treating vendors fairly attract better partnerships, strengthen stakeholder relationships, and reduce reputational risk. Collaborative procurement signals a maturity and professionalism that reinforces trust across the value chain.

In essence, collaborative procurement is not just about being "nicer" to vendors - it's about being smarter. The benefits are practical, measurable, and directly aligned with the goals of procurement leaders and CFOs seeking to build a resilient, high-performing supply base.

Wrap Up

Tim Harvey's journey demonstrates convincingly that procurement's future lies not in confrontation but in collaboration.

For procurement leaders and CFOs focused on strategic value, building strong supplier partnerships and fostering collaborative relationships is essential for long-term success.

As procurement continues to evolve, embracing collaboration will not just win contracts but create enduring value for organisations ready to move beyond adversarial negotiation.

Listen to more procurement professionals share their insights by tuning into Procurement Reimagined.