Enjoyed reading Purchasing at the Parthenon by Bob Soames in a recent Supply Management article (subscription required for online access). It describes procurement practices in ancient Greece, 2,500 years ago – the challenges they faced then were very similar to the ones buyers face today: cost overruns, fraud, poor quality supplies etc.
Two interesting solutions of theirs:
The city of Ephesus contracted its works out to private companies. When agreeing a project, the architect had to sign over all his property to the city as security. If the project came in under budget then all well and good. The city would even pay for budget overruns up to 25% of the agreed budget. Anything beyond a 25% budget overrun would be paid for ourt of the architect’s own purse.
Buyer beware: during those times a distinction was made between business-to-consumer and business-to-business deals. In B2C sales, the buyer was allowed to return your goods as not fit-for-purpose. In B2B, however, professionals were expected to manage risks themselves.