We once heard a joke (from a client in procurement, nonetheless) that asked the question: Where should people go to die or kill their careers? The punch line was, you guessed it, “Give procurement a try!” We can all laugh at ourselves, but money speaks louder than humor – even if old jokes die hard. During the past decade, procurement functions collectively have spent billions of dollars on software, procurement transformation programs and third-party services in an attempt to drive better and more efficient outcomes. And they've done this in an environment that is changing rapidly, as is expected of the function. Consider all the procurement activity that’s under way yet must adjust amidst evolving corporate strategies:
- Preferential tax treatment – based not just on headquarter locations, but transfer pricing, the building of specific procurement/supply chain “companies” and related initiatives
- Globalization – not just of demand, but supply (with different requirements and expectations in different region)
- Working capital management strategies tied to A/P and P2P – and the building of fortress balance sheets (as a Global 2000 priority) juxtaposed against having to manage supply chain risk more efficiently
- Total cost management – incorporating all key stakeholders inputs and both direct/indirect costs
- Compliance – yes, the dreaded “C” word! The long of regulators is never far from supply chain and third-party management activity
Most procurement organizations (and leaders today) are prepared to tackle a couple of these areas, at best. But few have built a talent nucleus around what it means to interact with the business to coordinate these efforts as mapped to corporate strategy as well as optimize a broad set of customer and supply chain business requirements against additional internal constraints. In a coming series of posts on Spend Matters (as well as a guest paper we’ll be excerpting and featuring this fall from Deloitte), we’ll explore why the talent gap is impossibly hard for procurement to bridge – and why old strategies when deployed alone are coming up short. Put on the flak jacket. And polish up your LinkedIn profile. We promise that what we share will be both actionable on a managerial level, but also an individual one as you progress in your own career. Stay tuned!