Is ‘Free’ a Dirty Word in Procurement?

How can you resist something that is free? Even when something is genuinely free, there’s still that voice at the back of your mind that sounds a warning. 

If someone offers you something for free do you automatically say no? Do you sometimes get curious and wonder why it is free? If you ask more questions and find out that it is truly free, do you still say no? Or do you wait until you find out that there aren’t any strings attached either before you take a chance and say yes?

It doesn’t matter what walk of life you are from, or which profession you work in, there is something that has changed in the human psyche that has made us all inherently suspicious of the word ‘free’. And in procurement, this suspiciousness only appears to get worse.

Something for Nothing?

We now live in a very skeptical society. Long gone are the days where you took someone at their word, without question. Now, recommendations and references are gladly accepted, but further research and checking is carried out before anything is done with them.

It’s probably true to say that there are few things that can be offered that are truly free or come with no strings attached. Entering a competition or signing up to a ‘free’ service online puts your e-mail address on a mailing list, to allow you to be sent future opportunities. Even ‘free’ products are likely to be being used as a loss leader to make you think about spending real money.

Perhaps the reality of it is that we are no long as trusting in nature as we once were, and trust has to be earned, rather than being given until proven otherwise.

Trust me, I’m a Procurement Professional

Trust comes in a variety of guises in procurement and supply chain, two of which we can look at here. First there is the trust between the buyer and supplier, the buyer and end user, or between any two links in the supply chain. This trust is based on the idea that what has been ordered or requested is what is delivered, at the right time.

This is trust that needs to be earned, and is a particularly fragile form of trust, which can be shattered by one missed delivery, one failed quality inspection, one wrong phrase in a negotiation. What is key though, is that this trust is crucial to the smooth operation of a supply chain.

Trust can be built in the supply chain through providing great, consistent service, and delivering on promises. Transparency in operations is a good tool to build trust – many organisations are building consumer trust in this way by making their supply chain operations transparent to the public.

 Everyone Likes a Freebie

The second type of trust is between the procurement or supply chain professional and their stakeholders, such as their employer, shareholders or the public. The trust in this case is based on the professional doing their job in an ethical fashion, and not being in receipt of ‘free’ things in return for contracts and business.

The ‘free’ items on offer could range from being taken out for dinner or being taken for hospitality to a sporting event, to kick-backs and bribes. There have been numerous reports of bribery and unethical behaviour in procurement, all of which have succeeded in eroding trust in the profession, as well as giving the word ‘free’ negative connotations.

However, it could be argued that not every ‘freebie’ is given with strings attached or with ulterior motives. In fact, giving and acceptance of gifts can help to create goodwill in the supply chain, or show appreciation for a job well done, or a successful relationship.

While strong governance regulations help to ensure transparency and ethical behaviour, requiring endless forms and registers to be filled in for low value gifts is potentially punishing the honest many, for the actions for the dishonest few. Now that procurement has begun to earn that trust again, maybe it’s time for the profession to be trusted more.

After all, free isn’t such a bad word, is it?

We would be interested to know what you think? Have regulations gone too far? Or are they entirely justified in light of past events? Is there such a thing as a ‘free lunch’ in procurement?