I have been covering KPMG’s paper FUTUREBUY: The Future of Procurement – 25 in 25. And in the last post in this series, I offered up the analogy of procurement as organizational yenta, bringing together parties (internal customers, suppliers, etc.) and uniting them in partnership, if not trading matrimony. This is a critical topic to explore in detail, as few procurement practitioners and leaders today tend to be good relationship brokers (except those who’ve been in sales, but that’s another story). But consider why this matters:
“Relationship brokers are able to connect people in different organizations, based on an understanding of their mutual and intersecting needs, that can create opportunities that weren’t there before. An emerging capability for procurement is the need to develop both outward and inward facing relationships.”
Bingo. Yet the problem today is that the right players are not necessarily on the procurement bus to make the journey.
Consider: “Recently, there has been a tendency for procurement to organize around internal categories based on characteristics defined by the needs of the organization. While this is, first and foremost, a hierarchy defined on product or service specifications, mature organizations are not limited to these defining characteristics. Rather, advanced category management consultants will be assigned roles that provide the most logical and simple interface between the external and internal worlds between which they must communicate.”
“For example, a procurement manager may be first assigned to a larger supplier that provides multiple products and services to the entire organization. He or she may be assigned to an emerging technology group that is focused on tracking innovations that can align with the internal technology product road map. A team member may be relegated to a largely external role as a cost analyst, understanding the movement of key metals, commodities, and chemicals in supply markets, and translating and codifying this knowledge into specific impacts. He or she may serve as a government interface to influence legal standards, tariffs, or environmental regulations that can dramatically influence procurement activities. In the future, we will likely see a diversity of procurement roles that are aligned more around internal or external business drivers, and less around category...”
Ask yourself honestly: Would you have the right skills on your team if you reoriented the function to serve in the role as relationship broker? It’s more than a fair question to spend time grappling with – and addressing head on.
You can download the full KPMG paper if you’re interested in more on the topic. Even if you don’t agree with everything in it, we promise it will get you thinking!