From ‘Seeking Control’ to ‘A Better Buying Experience’: How AI & Tech Are Changing the Narrative

Episode Summary:

In our latest Subject to Talent podcast, Jack Quarles, Head of Advisory at Brightfield, joins David Clevenger, AGS head of sourcing and advisory, to discuss the evolving procurement landscape. In this episode, they dive into why traditional procurement processes often fall short and examine how advancements in AI and automation are redefining how organizations work smarter.

Transcript:

Allegis Global Solutions presents the Subject to Talent Podcast, a hub for global workforce leaders to unleash the power of the human enterprise. Listen in as we explore the most innovative and transformational topics impacting businesses today.

David Clevenger: Hello and welcome to the Subject to Talent podcast. My name is David Clevenger. I'm the head of sourcing and advisory here at Allegis Global Solutions and your host for this episode. I'm excited to introduce today's guest who has been a thought leader and practitioner for over 20 years, (and) a bestselling author who has earned several national awards for his insights. He served as a Fortune 100 procurement director, a mid-market interim chief procurement officer, and in 2018 he joined Brightfield as the head of advisory. Looking forward to this chat with my long-time collaborator and pal, Jack Quarles. Welcome to the podcast, Jack.

Jack Quarles: Hey, David, I feel like there should be reciprocity. If you get to read that list from me, I should do it for you, but hey, we've been at this game for a while now, haven't we, you and I? In fact, you've made a few key introductions and connections for me over my path, which I greatly appreciate. And I also really respect how you – again, going back decades – have kind of been leading this space of how companies are buying, how they can buy better. I feel like there's never been a better time actually to be doing this, though. I will say that. And so I'm glad we're talking about that today and whether you've got a staffing perspective on this or you're coming in from more of a traditional procurement sourcing path like you and I have, these are exciting times to be in this space.

David Clevenger: I agree. I think what makes it so exciting, at least in part, is it definitely seems like there's more interest, more focus from companies. You and I, without going into too much detail on our robust ages, have been at this a long time. We were there for the beginning of this strategic sourcing revolution. We saw that applied to so many categories and such a broad transformation in the space. But this spend, this SOW spend, this services procurement area was always something that was sequestered. It was always sort of kept out of the data sets that we saw and the stakeholders with whom we worked. And I wouldn't say that it's overt, but I feel like we're at the beginning of a change in that space. And it brings me to probably my first question for you as we start the conversation in earnest, which is what do you feel are some of the things that have traditionally kept this [procurement solutions] from being a success, from companies looking at this strategically and in the same way that they look at other spend categories?

Jack Quarles: The very first procurement conference I went to, this is dating back at least a couple of decades, and they had a panel and it was called, “Services Procurement, the Dark Pool of Unmanaged Spend.” It sounded like a Harry Potter sequel, right? This era of mystery and malevolence kind of swirling about, nobody knew quite what was in it or how to get at it, and they just knew that there was a lot of stuff there that wasn't quite as it should be. And I think that that has been the case. So your question was why was it so tricky for so many years? I think there are a few things. I think it was kind of this other category, this big shed in the backyard where you kind of put everything that didn't fit into one of your other clean categories. It wasn't travel, it wasn't facilities, it wasn't fleet, it wasn't office supplies, it was kind of the other stuff that was tricky.

A lot of variety in that category, too — and a lot of complexity. And so you kind of needed some of the subject matter expertise, a little bit more nuance to understand and to source these areas well. And then I think that dynamic's been part of it too because you've got literally sort of buyers all over the company and we serve some clients that have hundreds of people in their organizations that are raising [statements of work] SOWs. And for a lot of folks, that's the only supplier engagement that they're managing. They're really deep and really strong in their area, whether it's marketing or creative or facilities or R&D or product, but how many suppliers do they manage? How many vendor projects do they run from stem to stern? How many agreements do they set up?

And yet these are folks with a lot of power in the organization with big budgets. And so I think getting into their business a bit and saying, "Hey, we can help you," has always been resistant. It's always been something that's kind of been hard to do. And then I think it's always for that defaulted to this relationship between the buyer and the seller where they say, "Well, look, we're not going to quite put the final bow on everything we're going to do together, but let's just start working. Let's just get the time and materials meter running and let's see where things go." And then it tends to spray a little bit from there.

David Clevenger: Jack, you raised a number of really good points there. I want to respond to a couple of them, but before I do, I want to get back to this point you made around the complexity of the category and obviously just asking you, Jack Quarles, this question, not asking you to speak for the world. But as you think about that component of this, you've sourced a lot of different categories and a lot of them are very nuanced and complex. Do you feel like there's anything inherently different about services procurement that makes it not fit into a model where it can be competitively negotiated or is that a blocker that people have used over the years and said, ’No, guys, this is different. Your methodologies don't apply here.’?

Jack Quarles: That's a really good question.

David Clevenger: I only ask the good ones, Jack.

Jack Quarles: Yeah, no, you only do and you ask the hard ones, and I don't want to have a cynical answer, but I think one thing that we see in this category is outsized influence by the suppliers and supplier salespeople, right? They tend to be driving the process a lot more than the buyers. Okay. If you think I hit something, I want to hear what you say about that. Now, how much of that is true complexity that we can't get into versus how much can we handle? That's a good question. We can go a little deeper on that.

I think that one of the temptations of the sourcing folks serving these stakeholders with the budgets is to kind of accept that complexity, to know that your stakeholders have more understanding the subject matter than you do, and to not be willing to come in with a couple of dumb questions maybe, or a couple of ways to sort of organize things. There are some nuances for sure. I think we need to allow for that, but we also need to sort of organize that and categorize that and figure out what's the value on some of that nuance. But you thought I hit something, so I want to hear what you think.

David Clevenger: No, I totally agree with what you just said. I think there are sort of three big pools of this, and you already touched on a couple of them. One is the stakeholder group. It's not only varied, but it is also made up of a lot of individuals. If you think about the folks within an organization who run IT, who run finance, who run engineering and product, these are very powerful individuals within an organization and a lot of them have the ability to say no or to drive things through their own channels and through their own process. But I think one of the interesting, let's call it a psychological component of this process, is that the individuals I just mentioned have already gone to the CFO and negotiated a budget. They've been given a certain budget and have outlined the projects that they're going to tackle as a result of that.

And now procurement is coming to them to say, "We'd like to negotiate this again." And I think they're going, "Guys, I already negotiated this. Now I've got work that has to be done and you're slowing me down." And so it almost becomes where in this process should we be having this conversation? But I think there's a justified position by some of these stakeholders that they feel like they've already gone through the numbers component of this, and now it's time to get the work done. I think the actual inherent complexity of the category is a piece. I agree that it's nuanced and that it's different and that it's unique, but there are certainly plenty of other categories that have been included in procurement transformations that check those same boxes.

The last point I want to make though is one that you just touched on briefly that might be the most important part of this, and that is that this is a uniquely powerful supply base. Not on the whole, but certainly there are folks that we're talking about right now that are the Accentures, the IBMs, the McKinseys, the Bains. These are organizations that wield a lot of influence within these organizations, within buying organizations. They are companies who, we might be looking at an SOW for a very discreet piece of work, but they're doing something else highly strategic for that business. And so we don't want to upset that apple cart. And when we're talking to buying organizations, one of the things we see that holds them back frequently is a genuine fear that these suppliers won't like this. And it's not a fear that they have frankly of Staples or Office Max when they're buying pens and pencils, but it is a fear they have of these suppliers.

Jack Quarles: And you're implying that they don't have quite the same fear that the procurement team or executives will hold them in some sort of a disregard.

David Clevenger: That's true. Yeah.

Jack Quarles: It's a little unbalanced there, right?

David Clevenger: Yeah.

Jack Quarles: And of course we've talked about this a lot recently and over the years, but I think I know where we're headed with this a little bit too in terms of yes, there are some things that have really changed in the environment, some external things. And I know we're going to talk about that a bit, but I want to stay on this kind of psychological piece you mentioned and the relational piece, because I think that is so important. One of the things I'll ask when speaking is we'll say, "Hey, you've got challenges and you've got challenges with people. This is a change management job, this sourcing role. So let's talk about how challenging is the outside relationship area, your suppliers, how challenging is the inside relationship area?"

And what I get almost 95-1is the inside piece is a lot harder, navigating your own internal change management, resistance, distraction or politics or turf protecting, whatever it is. So I know we want to get to new models of relationships and new approaches there as well, and we'll probably get a little deeper on that. But I think what you've just laid out in terms of acknowledging where the relationships are, where the power is, what they think when they've got a consultant that's coming to them that's maybe pretty integral to their team's operations and maybe they've been working with them for years, and so that's somebody that's helping them get their job done. And then this guy or gal from sourcing comes in and says, "Hey, let me help you do this better. You're spending too much. You did it wrong." And just thinking about how that perception is and how we can maybe acknowledge that but then get a better start.

David Clevenger: I agree. And it's not even just procurement. And I think that's one of the interesting things, and if we think about the level of transparency and inclusion throughout this process that can contribute to a more successful model is that if you look a little further upstream at the ideation point of these projects and when need is discovered in an organization. Legal has no visibility to that, finance has no visibility to it, HR doesn't and procurement doesn't.

And I think that if we think about how we get individuals from those groups are a little bit hamstrung. They are flat-footed by the time these opportunities reach their desks and there's a limit to what they're able to help with, to what they're able to accomplish and the value that they're able to demonstrate to their peers who are raising these SOWs in the organization. If there was a way for them to be involved earlier in the process to understand, here's something IT is thinking about which may result in an RFP six months from now or a contract nine months from now, that would be valuable for these groups to learn. Is a different level of upstream visibility part of the solution to what has been a tricky process within most organizations?

Jack Quarles: And I think we see that coming. So you and I had the privilege to work with a group of industry leaders the last year. We had five or six sessions with them and spent many hours on it, and we spent a lot of time on just that problem statement on why hasn't it worked better, why haven't things changed more in the last 20 years? Then we got to some pretty exciting thoughts on where it's going now, both the definition and how things are moving there. And I think, again, that comes from a few different angles, but I think your thought of getting upstream a little bit, getting involved earlier and what you've told me a few times is, "Hey, by the time they come with the budget or the agreement, it's already too late."

Then sourcing and saying, "Okay, you've already done 60% of it wrong, but let me try to help on that 40%," right? Or, "Let's try to backpedal a few steps so we can redo this." And of course that's never a winning situation. So I love your point about getting in earlier and I think there ways to do that relationally, maybe organizationally. And then we've got some exciting new ways I think to do that with the technology that's emerging that's allowing earlier engagement and earlier involvement from the users.

David Clevenger: Jack, you referenced the Trailblazers program that you and I were both involved with last year that Brightfield was spearheading and that AGS was partnered in. Would you just take a moment, talk through what the genesis of Trailblazers was and where we took that over the course of 2025?

Jack Quarles: Very relevant to this conversation because we came in with a problem statement being that procurement and specifically services procurement has not evolved the way other disciplines have. And if we look at the last couple of decades, we're talking about a lot of the same problems that you and I have already talked through a few of them now than we were again 20 years ago. So we wanted to say why is that? But more importantly, we wanted to get to a vision of the future. Our thesis is that a lot of the reasons maybe folks aren't moving forward enough because they're not quite certain or confident in what they're moving toward. And we thought it would serve candidly our respective companies, David, yours and mine selfishly, to get some insight into that.

We also felt like it would really serve the industry in the marketplace if there were a much more clear destination about what this next generation of services procurement looks like. We're really happy with where we got as well. So we worked, again, with these leaders from a dozen companies that everybody listening would know, a lot of brand names, and folks that were senior practitioners, but not quite chief procurement level folks that really kind of knew what was going on on the ground and got their hands a little dirty in the operations and were happy with what we came up with in terms of a future vision for procurement and services procurement specifically.

David Clevenger: So on that note, as we get to that end point, which is the part that everybody is most interested in, I'm interested in talking a little bit about the context in which that sits. So you have a situation where, and we talked about this in Trailblazers and certainly outside of that, and it's a conversation that goes on in the offices of probably every company in the world. There are these great technologies and AI is changing everything and there are best in class processes and there are all these things. What is the environment in which that has to sit so that those things actually become implementable and usable and start to make a difference?

And some of the things we talked about within that context were who owns the program within most of these organizations? Is this a procurement thing? Is it an HR thing? They sometimes bounce back and forth between those groups. Are the stakeholders like IT as involved in the ownership of these programs as they should be? And are we at the point where we have in fact built a better mousetrap and it is just about changing the context or do both of those things need to happen together? I know we're pressing for automation, we're pressing for agentic AI. Is the field actually prepared to accept those solutions, so even if they exist or once they exist, they'll be taken up and we will actually see a difference?

Jack Quarles: Gosh. So that's a great question and I think the answer's going to be uneven. Let me start with a couple of things I think are pretty important ingredients and I want you to chime in with more. I think like you said, it's really important kind of the environment that comes into. I was on site with a global company that's got 170,000 staffing workers in their program, huge program. And one of the quotes the leader said kind of hit me, he said, "Look, if you keep pushing the button for a long time and it's not doing what you want it to do, then stop pushing that button and try another button." And what I thought of as regards to our conversation was the button of policy or maybe control’s an even better word, right? This idea that we've been talking about for so long, "Hey, let's just control the rogue spin. Let's get more in the program. Let's get procurements mandate out there so we can get folks that have to come and use the process."

And I think we've just got to admit that that's really not getting us where we want to get. And maybe there's some exceptions to that, but with all the companies we work with, I think an overreliance on policy or a mandate is not the secret ingredient. So where does that leave us? It leaves us kind of wanting to have a process and a product that users want to take part in and that they see benefit in. And I really think we can do that. And we've got a couple of clients that are doing that where they've kind of rebuilt their brand or rebuilt some of their tools and interfaces so that their users around the company are reaching out to sourcing before something gets started so they can say, "Hey, how do we do this the right way? Is somebody already doing this in the company that I can learn from?" And that sort of conversation.

And I think that is where the technologies really are helping us because I think some of these new intake platforms and getting a little bit of orchestration is of course one of the key terms that's used, but I think that is moving things forward and very importantly so, because to keep going down beating the drum of, "Hey, we need more spend under management, we need more control, we've got to have folks follow the process," it gets exhausting. I think we just end up sounding like folks that are telling people to do their chores and at the end of the day just hasn't gotten us where we want to get as a discipline.

David Clevenger: Well, and it's all stick and no carrot and I think you just nailed it when you were talking about policy versus something that's actually better and if it's better, people will come to it. I don't think that there are – at the risk of oversimplifying – there are not this infinite number of things that you're trying to accomplish with an SOW program. You need visibility, you need compliance and you need to generate value from it, and that's it. That's where all trying to get and that compliance piece, sure, I'm certain there are examples and maybe a listener or two will write in and correct me and tell me there are dozens of examples of places where you have a CFO or a CPO who banged their fist on the desk and said, "This is the way it's going to be, folks, and you're going to do it this way," and everybody just falls into line. I think those are rare and I don't know how long-term viable they are, but when we talk about building a better mousetrap, it's not just the tool.

It's something that user in the business finds more valuable. This made doing an SOW easier, it made it more comprehensive. I got a better result. I was able to use my budget flexibility or have more flexibility in my budget. It was all of these types of things that made this a better experience for them and they're going to come back to it with that next one and the compliance is going to come from that. That's going to enable visibility further upstream into what we're spending because they're going to be more transparent and it's going to enable these groups like finance and HR and procurement to generate value out of it. They're going to do more of this competitively, they're going to manage it more closely post award and they're going to be able to extract cost, which [at] the end of the day is really the only thing still when you force clients, and I'd be curious to hear when you're talking to clients, but certainly when we are to stack rank their priorities, saving money is still number one. That's still what's driving most of these companies.

Jack Quarles: Still number one. And I think just looking back to the last six or seven years, I think really the last two years it's been enough of a number one that folks again are turning their attention to this services procurement category and saying, "Okay, we kind of put this off to last, but we know there's a lot of value here. We know that we're spending too much here." I think that combined with the technology to say, "Okay, now we can really get into these agreements we never have before. Now we can do analysis on this labor we're buying like we never had before and compare it to other things we're buying throughout the organization." I think that's really promoted this to the sustained attention that you and I have been saying it needs for a long time, but is now getting that.

And David, I would say this too, and I know there's more to say on the savings side, but I think bringing the quality analysis and a little bit more quality metric and did we get out of this what we thought we did? And I think here's where again, relatively simple but recent technologies that can track the projects and then reach out and poll users and say, "Hey, how did this go?" And maybe go beyond simple metric of was it on budget and was it on schedule? And that's a place to start, but we can certainly go deeper with that. Did this supplier have the expertise? Were the milestones met? Was it set up as an outcome-based agreement in the first place in terms of going back to the structure and the design?

So I do feel like I totally agree that cost has got to be number one. That seems to be what's really driving the marketplace now with uncertainty and all sorts of things. However, I think to bring quality into it is a little bit more of that upfront carrot you were talking about, right? That gives a user reason to believe, "Hey, you know what, if I'm going through this process, if I engage the sourcing team, if I'm using their tools, I'm much more likely to get to an agreement that shifts the risk the way I want it to, that puts a little bit more on the supplier, that defines the outcomes better in a way that really aligns to our strategic objectives and the metrics by which I will be measured and I want to do this because if I don't, I'm at the risk of getting to the end of another nine months of time materials that didn't really move the ball like I hoped it would and that's stuck there."

David Clevenger: Absolutely. And I think maybe it's even some supply market intelligence that they wouldn't have otherwise had. I'm calling vendor A, because it's somebody I've worked with before, but I don't know if that's just because I know they're out there and they've got bodies versus actually here are a dozen providers who specialize in the niche thing that you're looking to do. Any stakeholder in the business is going to find that.

Jack Quarles: Can I add an anecdote to that specific example?

David Clevenger: Please. Yeah.

Jack Quarles: I love that. I think that's really important. So again, market research of course is easier than ever with the aid of the AI tools that are at all of our fingertips. What we've found especially compelling is being able to take that internally to your own program. And so that's one of the things we do through TDX by finding internal benchmarks for all the roles you're buying. So what do you need from that? You need to be able to kind of map apples to apples to say, "Yeah, these are the skills that we're buying." And kind of look at the engagements on a skill level, not just a worker level. So you're not just counting people but you're looking at what they're doing. And then again, map that to who you've already got in your stable, who you've already engaged with.

And then if you can bring that quality piece we talked into before, then you've really got some magic because you're starting to come as a sourcing person and not just say, "Hey, you're paying too much," but you're starting to say, "Well look, you could pay this much less with an existing incumbent who we've already gotten good results with and who that leader over there can recommend to you and you know them and respect them." And that's just a very different conversation than just coming with sort of an abstract of, "Hey, here's what the market says," which is also important in the conversation.

David Clevenger: Yeah, Jack, as long as we've entered the plug portion of the podcast, I will say based on your earlier point that one of the things that AGS Managed Services (AGS) is doing for clients, (and feel free to hit your forward 15 seconds ahead if you don't want to hear this) but we have exactly that service, that metrics tracking that you referenced earlier, and it's very simple and it's purposefully simple. Did this project deliver what the SOW said? Did we meet those milestones? Did the supplier meet those milestones? Did they do it on time and within budget? And would you recommend the supplier?

These are three binary questions and they're so critical to what we're trying to do and individually project by project they don't mean that much, but in aggregate that information is incredibly powerful and valuable to an organization and valuable again to those stakeholders as they raise that next SOW, that serves their decision-making process. And so that's definitely a change and evolution that we've brought to our clients as we do that and obviously looking to automate that component of it as well so it's part of every SOW and helps to get captured in a more organized way.

Jack Quarles: And so we're getting to some specific recommendations here, which I think is really important for everybody who's listening. You and I were talking earlier about the difference between the companies that really save a lot, that really make a huge impact and those that make less. And I think the biggest thing we came up with first is the companies that save a lot, that have a great impact are those that get started, are those that actually take action on the insights. It's one thing to do the analysis with a tool like TDX and get the insights. It's another thing to put into practice. And so that's one of the reasons we love partnering with AGS and especially when you're engaged in helping to manage the services procurement solutions is that you're there, you're on the street and you have the relationships and you're able to sort of put things into action.

I'd say another benefit,  is it's really important about having a third party come in because if you are dealing with resistance, if you're dealing with politics, perhaps if you're dealing with inertia, maybe it's just memory – a company memory that's kind of not helping things move forward – it often helps a lot to have somebody from the outside come in, right? There's the old comment about you want one neck to choke when things aren't moving the way forward. But I think a more positive way to say that maybe is it really benefits to have somebody from the outside to bring that sunlight to present who you are externally. And I know you found, David, with a number of your clients that you've been able to come in and sort of break through some of that resistance and get a lot of change and see a lot of impact where there wasn't a history of that, let's just say.

David Clevenger: I appreciate that, Jack, and I think it's such a critical point and there is no magic wand. If you set up one of these programs, you are going to have challenges, period. There's going to be change management things that come up internally with different stakeholders, with tech, with buttons that don't do what they're supposed to, to use your earlier example. You're going to have suppliers who are unhappy and don't want to participate and they're going to call their contacts within the business. All of this stuff is going to be bumpy, it's going to be turbulent. The companies, and we get asked this all the time, I'm sure you get asked this all the time, "What are the companies doing? The really successful companies, what are they doing?" The answer really is they don't know anything you don't know. They had all of these exact same challenges that you're afraid of.

They got comfortable with what the bad things were that could happen, and they started anyway. And they went through that turbulence and now they have really successful well-run, well-managed programs and I am consistently impressed. And we just launched a very large SOW program for a company and very impressed with their team of HR and procurement professionals who worked really hard to understand what are the things that can go wrong, what do we have to keep our eye on? They know that they're in for probably a bumpy year as this thing really takes root, and they also know that in 2027, they're going to have one of the leading SOW programs in the world because they didn't let any of it keep them from starting. And that's certainly the advice and the guidance I would give to any organization that's looking to do this.

Jack Quarles: I love that future vision too, of looking ahead to where you're going to be. I think that's a really important piece that we hadn't mentioned. As you're talking about that also, because complete agreement about just getting going just despite the bumps, our question as we take sometimes hundreds of SOWs at once, sometimes over a thousand and analyze those for our clients and then come back to them, and we have a lot of results and a lot of opportunity, there's always more opportunity than they're going to be able to digest and to act on. We know that.

Our question has shifted. It used to be, "Hey, where do we get the biggest return?" And now we're simply asking, "What is most attainable? Where can we get the quick win?" Where can we be in 60 days saying, "Hey, here are the results." Or even 45 days where we took this output and maybe we just changed rates on a couple of roles and maybe that was it, but now we've got some savings. Now it's a different conversation. Now we're just talking about how much more we're going to do and where we're going to take that next, and we're showing that internally to other leaders in the organization. But attainability is so important, I think probably more important than anything else, and that really dovetails with what you're preaching, David, is just get started, get going, and start taking those steps.

David Clevenger: I love that, Jack. We've been at this for a long time. We've been friends for a long time. I appreciate the many fruitful discussions we've had up to and including today's.

And I'm going to make a plug for you, for those of you who haven't ever seen it or heard of it, Jack wrote a book several years ago called, “Same Side Selling,” which actually speaks to a lot of these principles around stakeholder alignment and management that I've recommended to many [people] over the years. I hope some of those people have actually bought it and it contributed to Jack's royalties, but it's a terrific book, and Jack's had a terrific career and continues to add just a ton of value for folks now in his capacity at Brightfield as well. So thanks, bud. I really appreciate you joining us today on Subject to Talent, and I look forward to us continuing to work together for many years.

Jack Quarles: It's been really fun, David, and I'm so glad you are where you are at AGS leading the group there. And I definitely agree that '26 is going to be the best year procurement’s seen in a long time, largely because of what you're doing, what others the same mindset are doing, so very excited for that.

David Clevenger: Great. Thank you.

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