Commercial Awareness

This In-house training programme will give your commercial and management team a thorough understanding of what makes a business successful by the buying and selling of products and services and the factors that influence success.

In-house Training Services and Consultancy

If you are looking to enhance your teams commercial acumen then this In-house programme is ideal.

This programme will give your commercial and management team a thorough understanding of what makes a business successful by the buying and selling of products and services and the factors that influence success. By concentrating on the processes, relationships, risks and costs involved in commercial and related activities enhanced effectiveness can be achieved in these two days.

The programme will facilitate ideas and actions from your commercial and management team, shaped by the presenter/facilitator and a challenge to current practices. It will be informed with anecdotes and examples to make the subject ‘live’ and fully engage the participants.

Your next step is to call us now on +44 (0)20 7729 6677 or email us at info@falconbury.co.uk or use our contact form and find out how we can help. There are no commitments, and if we cannot help our advice and recommendations are free of charge.

Sample Programme Day 1

Introduction and Procurement Cycle

This is a logical start to the course and we will set the scene for the two-days and present essential phases of the procurement cycle.

  • Recognition of need
  • Gathering supply market intelligence
  • Preparation of specifications
  • Communicating the need to the market including Pre-qualification and Invitation to Tender documents
  • Evaluation of PQQs (RFIs) and ITTs (RFPs)
  • Supplier due diligence, including reference site visits, financial and other checks
  • Source selection criteria and the impact of negotiations
  • Contracting strategies and the management of risk
  • Contract award and the value of debriefs
  • Mobilisation actions and programmes
  • Contract/project management and the hierarchy of authority
  • Payment regimes, including milestone considerations
  • Inspection, acceptance and performance measurement
  • Handling disputes and dealing with the interpretation of contract terms
  • Fulfilment of need

The Requirements Specification

In our experience this facet requires serious emphasis. The specification is fundamental to ensuring the successful outcome of any engagement with a) supplier and b) a customer. We will include the following content:

  • Different types of specifications, including output based, prescriptive, chemical analysis, supplier’s standard product/software, research led specification when, initially, no ready solution is evident
  • The pitfalls of early engagement with possible suppliers
  • Intellectual property rights considerations including sales/tendering considerations
  • Deciding on acceptance criteria, acceptance testing, guarantees and warranties
  • Enterprise change requests – the impact of changes to specification after award of contract, including project risk, cost and timescales

Contractual Remedies

In the field of ‘Contractual’ matters there is an opportunity to strengthen the understanding between functional areas. The terms and conditions are the sole preserve of your Legal Counsel! We offer our experience which informs us that we should place an important focus on contractual matters, including:

  • Many non-legal specialists are unfamiliar with contract formation rules, including offer and acceptance
  • The structure and content of complex contract terms and conditions has, often, not been explained to key personnel. One explanation is inadequate handover processes from Procurement/Sales to other post contract award stakeholders including Project managers, Financial experts and contract monitors
  • Our first emphasis will be upon contract clauses that are designed to give some power and information to contract stakeholders, including mobilisation plans, key personnel CVs, reports (their content and frequency), compliance with critical elements of the ITT, provision of resource plans and costs
  • The second emphasis will be the contractual remedies including liquidated and unliquidated remedies (not penalties), dispute resolution (concentrating on ADR unless directed not to do so), problem escalation procedures, arbitration and resort to the Courts
  • We will include a (pragmatic) input on Partnering Agreements, emphasising how partnership governance arrangements can materially change relationships

Contract Management

Within the context of this course, contract management is a vital consideration. Contract management training has been the single greatest growth area as a ‘function’.

The proposed content of this session is outlined below:

  • Definition and process of contract management
  • The role and skills requirements of a contract manager
  • Contract management plans
  • Managing a contract review meeting
  • Managing contract change
  • Contractor and sub contractor relationship management
  • Managing a contractual dispute situation
  • Applying contract remedies
  • Rights of termination (determination) of a contract
  • The obligation to mitigate losses

Sample Programme Day 2

Supplier Relationships

This has been an undervalued commercial consideration for many years.

The content will include:

  • The contrast of transactional and relationship purchasing
  • Stages of supplier integrations into the buying organisation
  • Relationship investment modelling
  • Supplier management profiling for captive buyer, strategic partnerships, market exchange and captive supplier relationships
  • The supplier’s DMU (Decision Making Unit), how it can manipulate or support the buying organisation’s objectives
  • Supplier driven behavioural patterns and client-side management of such behaviours
  • The role and impact of contract review meetings
  • Events that will put pressure on relationships, including hospitality

Price and cost

The management of price and costs is central to a relationship across functional areas, for example between Project Managers, Sales/Tendering and Procurement. The intention of this element of the event will be to emphasise how suppliers (and ‘buyers’!) can make pricing decisions and how vulnerable the ‘buyer’ is to changing prices. We will build into the course our knowledge of prices and costs. Many examples can be used from Defence and Government as well as retail, IT and financial services.

Our outline approach will be:

  • The difference between price and cost
  • The strategic pricing options available to a supplier, including full cost, marginal cost, penetration, skimming and promotional pricing
  • Devising cost models for submission by the supplier with their tenders
  • The impact of contractual risk on pricing decisions
  • Pricing contract changes
  • Indexation of prices and price variation formulae
  • Linking the supplier’s annual accounts to his pricing decisions
  • Using the FORM 10K with USA suppliers and partners
  • Dealing with contingency provision
  • Incentivised payment
  • Contract/project retentions

Negotiation and Influencing Skills

The development of negotiation and influencing skills is, we believe, an area worthy of emphasis. There are two considerations, namely, the intra-organisational negotiation skills and those applied to suppliers and customers. Both can be effectively dealt with through an appropriate case study.

Our outline approach will be:

  • Explain the ways in which we may change other people’s views, we will emphasise logical persuasion and genuine business objectives as the most positive to apply
  • Demonstrate, through examples, the classic areas which are negotiated and the support that should be sought from sales and procurement, where appropriate
  • Explain the essentials of professional planning, including strategy and tactics
  • Explain the positive nature of making effective proposals for action and not being reactive or subservient to the supplier
  • How to ‘read’ the progress of a negotiation
  • Introduce the consideration of culture on negotiations

Final session

The course will culminate with a summary session, where each participant will prepare an action plan for implementation in their future activities.