The unprincipled Agent

On whose behalf does the agent work?

The procurement world is one immersed in the legal and economic world of Agents. The Chief Procurement Officer is an Agent of their organisation (the Principal) when they represent the organisation in negotiations. The CPO is required to act in the best interests of the organisation and not for their own personal benefit. Equally those dealing with the buyer can be expected to accept that the buyer has the authority to  make commitments on behalf of the buying organisation.

When the CPO lets a contract, as part of a recruitment process, for someone to run an assessment centre, who is the Principal and who is the Agent? To me the Principal is the buying organisation and the provider is the Agent. The provider will be paid by the buying organisation and not by the successful candidate - indeed the provider can expect payment whether or not a successful candidate is found.

When the organisation lets a contract though for intermediary services, say, Executive Search or interim placement services, who is that Principal and who is the Agent? 

Let's assume a headhunter contacts the CPO and asks if they would be interested in a potential new role, who is the Principal?  Is the Principal the CPO who will be represented by the headhunter or the organisation seeking the new CPO who will pay for the headhunter when a shortlist of potential candidates is provided? 

When the scenario is the placement of an interim CPO, who is the Principal and who is the Agent? The assumption of the buying organisation is that the 'interims' provided have been checked by the placement agency and that they have completed the relevant due diligence. Isn't it?

These questions were triggered by a report in today's Financial Times on Page Executive's approach. Page are alleged to be now taking a more cautious approach to the organisations they place candidates with. Not, it appears, to protect the buying organisation, the 'headhunted' or the interim. but to protect Page's financial investment should the buying organisation, which may be among those who, in Page's eyes "live week by week", default on Page!

If an organisation wants an interim CPO, perhaps because they realise they need a financial 'turnround', it implies Page will managing Page's risk exposure and not those who may have assumed they were the Principals, who have a lot of 'skin in the game'. Is this yet another change to the world of procurement as a result of the financial crisis?  Either way, it strikes me that before you jump to the conclusion that you are the Principal and the Agent is working on your behalf, perhaps reading the small print may prove advantageous and recalling: 'caveat emptor'. 

The curious case of the procurement of blue light temporary staff

PSNI are the subject of an investigation on re-hiring former officers as temps. Estimates of spend vary but somewhere between £45m and £60m is reported to have been spent over five years. That's slightly more than the response given to a FoI request in 2009 which stated an estimated value was £5m (per year).  

Three quarters of those hired are former police officers who were recipients of redundancy payments. That's 300 staff. 

You may ask, 'why were they made redundant in the first place - what was the desired outcome?' The redundancies were the result of the Patten Recommendations to transform the former RUC into a new PSNI. Critics could argue that aspiration has not been achieved. Supporters could say there was a need to ensure business continuity and the terrorist threat had not gone away.

In addition, it was a condition of the redundancy scheme that if those made redundant were re-hired as police officers there would be a repayment of the redundancy payments. Was the contract designed to circumnavigate that requirement since the stipulation doesn't apply if those re-engaged are civilians; even, it seems, if they are carrying out broadly similar roles.  Is this what is meant by the private sector taking up the slack from public sector redundancies?

If the intention was to re-engage as civilians, then the investigation needs to go beyond one contract into the whole category.  Up until now no one has mentioned the contract for Outplacement Services.  If you are fortunate enough to be unfamiliar with this service, it is a bit like a JobCentre Plus advisor which is supposed to help those made redundant adjust, and get back into employment. My experience of it was that it was a smoke and mirrors service which should have been paid by results.  But if they were paid by results, I don't think they would exist and a grant to the Samaritans may be better use of public money - I may save that argument for another day.  Nevertheless, how much was that contract worth and was its purpose merely cosmetic if a revolving door would have sufficed?

Now we face an interesting scenario which may resonate with others.  

How does this sit with