COMMENT: Is the procurement office a friend or foe to ad agencies?

But increasingly it is with 'the procurement department' of client companies that agencies are negotiating their remuneration. More, in fact, with the procurement department than with the marketing department with whom we might work on a day-to-day basis. Does this matter? Is this a good thing or a bad thing? And for whom?

The initial knee-jerk reaction is one of dismay and alarm. A procurement officer only gets involved for one reason. And that is to reduce the cost of the service provided. As Oscar Wilde might once have said: "A procurement man is someone who knows the cost of everything and the value of nothing".

And they certainly have no clue about what marketing communications do, or how we all add value to the brand and therefore to the stock price of the company, etc etc. Doom and gloom. Our whole world is going to the dogs and collapsing around our heads.

Well maybe ...

But I have often wondered recently why it is that client marketing departments seem to be more alarmed by this trend towards procurement department involvement than the agencies. Could it be that one aspect of the procurement man's discipline is to determine what it is that the company really needs; to buy only those goods or services that are truly needed; and then to agree a fair and competitive price for these goods and services.

This may in some circumstances lead to an agency doing less but at least it is openly and transparently agreed. The agency is no longer 'blackmailed' into providing services free of charge. It usually leads to a fair day's pay for a fair day's work.

But the real victim of all of this is the client marketing department who as well as having the power of fee negotiation taken away may frequently find themselves with fewer services to manage and fewer meetings to call.

Reduction of power and influence all round - internally and externally.

And the agency becomes more and more like any other professional service firm. God forbid that day companies might commission the procurement department to outsource their marketing communications completely.

So the next time 'the man from the pro' comes knocking on your door I suggest that you don't panic or go running to your marketing department partners for help and protection. Just engage in a measured and professional way. You will be surprised how re-assuring it is to audit and list your services, many of which you have probably been providing free of charge.