The most advanced procurement functions we research and work with are stepping beyond existing mandates and beginning to make us radically rethink the role of the procurement function and how it might look in the coming decade and beyond. In the first post in this series, Mind the Talent Gap in Procurement, we began to explore why most organizations have such a hard time aligning procurement and supply chain talent with today’s business requirements. Yet some companies (a small minority) have broken free from the shackles of status quo talent woes. This is why we need to Reform and Rethink Procurement Talent From the Beginning.
Top performing organizations are now examining procurement charters and activities in the context of how the function can become an arbiter of risk, reward and creativity for the business – and how procurement can serve at the nexus of finance, operations and supply chain. Moreover, these elite functions are not just managing compliance and risk. Rather, they’re forecasting it while incorporating global supply and demand factors and objectives into buying outcomes. And all the while, they’re an incubator for new business ideas and even broad-based innovation – using the right set of suppliers, not just supply chains, as sources of competitive advantage.
Human capital is at the center of all of these elements – and the general transformation of the function. Yet time and time again, we observe it as the weakest link in assuring not just “spend” and “supply” outcomes, but general business outcomes.
Identifying and managing the human capital that goes into making procurement functions achieve better performance consistently, and which allows procurement to adapt to changes like a chameleon entering different colors underbrush is still perceived as more of an art than a science. Yet it doesn’t have to be such a limiting factor for creating new types of sustainable and consistent outcomes. Strong talent can anchor new procurement initiatives, from driving new savings in sourcing efforts through more creative supplier and supply market engagement strategies to reducing risk by putting visibility and analytics at the heart of all decision making.
Stay tuned as this analysis continues.