New Research: The Four Faces of Procurement

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My colleague Peter Smith recently penned an invaluable paper that I kick myself for not writing earlier: The Four Faces of Procurement. Peter spends much of the beginning of his analysis examining a brief history of procurement. I know, you've read it a million times already, but you've probably haven't read it with flair, style and expertise that Peter weaves into the transformations we've seen in recent decades. More to the point, in the core of the analysis itself, Peter introduces the four faces of procurement, Leaders, Diplomats, Investigators and Analysts.

Peter goes on to explore each of these "faces" in more detail. But here's a preview:

  • The Diplomat is worldly, sophisticated, connected but tough
  • The Analyst understands global trends, data, markets and suppliers
  • The Investigator uses internally generated data to drive value opportunities
  • The Leader works internal colleagues to deliver organizational value

Consider "The Investigator" for a moment. According to Peter, while the analyst focuses externally, this face is internally orientated. Procurement professionals will not, we believe, need to be deep technology experts in 2020. Indeed, the strong trend we've seen in the last couple of years around usability as a key factor for systems will continue as software becomes more intuitive and even business solutions have a consumer-type look and feel.

However, our executive must be comfortable with the use of technology, and most importantly, have the capability to exploit that within the organization. This means being able to understand, work with, manipulate and interrogate the increasing amounts of internal data that will be available via the technology.

"My people have to be data driven," a Danish Chief Procurement Officer said to us recently. Whether it is in the context of the information available from ERP systems, spend analytics, supplier information and risk management systems or wider market and supplier data, the skill for the procurement professional will lie in:

  • Knowing what the mass of data means
  • Understanding how to use it, drawing conclusions and developing actions based on it
  • Developing the next level of questions to interrogate the data or the systems further (for instance, going back with the right "what if..." questions in advanced sourcing scenarios).

Numerical analysis, reasoning, and problem solving skills will be enhanced, in the very best Investigators, by a streak of creativity – the ability to take the data and make a leap to an extraordinary idea or conclusion.

For each of these faces, Peter considers the internal/external dimension " facing both external markets and suppliers, and internally to stakeholders, colleagues and budget holders" as well as the "analytical/relationship dimension – working in a data-driven, analytical manner when appropriate, yet also demonstrating a high level of behavioral skill and sensitivity."

Further, he also observes that not all procurement roles will need the same balance. Junior procurement analysts may not need to worry about the relationship side of things early in their career. Top CPOs don't need to be constantly down in the analytical detail. But the most successful procurement professionals, at all levels, will be those who feel comfortable operating with any one of our "four faces".

Download Peter's clever analysis, The Four Faces of Procurement, from the Spend Matters PRO Research Library (it is one of our "freemium" offers – anyone can access it).

- Jason Busch

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