Aligning Procurement with wider business strategy**

** No. 294 in our series of 'great boring blog headlines I have known'

Why do Procurement Directors get fired?  That's a bit more interesting isn't it? In my experience, there are three common reasons. The first two are obvious, the third somewhat less so.

1. Performance - simply, they don't deliver, can't hack it, fail to keep the factory supplied, sleep with the CEO's PA (of whatever sex / preference).... they are just obviously not up to it (as it were...)

2. Relationships - (nothing to do with the CEO's PA here..) but they fall out with, or just never got on with to start with, their boss, the CEO, or one or (usually more) key stakeholders. This may be related to performance, but often isn't.  Yer face just don't fit, mate.

3. Strategic mis-alignment.  This is the most interesting generally. Here, the CPO or equivalent often thinks (s)he is doing a great job.  They may get on fine with the key people.  But something just isn't right.  Here are some of the issues I have seen:

- The organisation is looking for a rapid cost reduction programme, perhaps suddenly because market conditions are changing.  The CPO is 'too nice' or 'too strategic' and can't turn into a hatchet person overnight.

-  The organisation is booming; new partnerships are being forged in different countries, new products developed and rapidly launched.  But the CPO is trying to put everything out to competitive bid, exert strong procurement compliance and governance, drive down prices.... 'not on our wavelength', complains the Sales Director to the CEO...

-  The CPO is driving greater procurement collaboration around a large organisation.  Everyone nods and agrees and says they understand why.. but deep inside the organisation's DNA, something stirs, and says "we operate as individual profit centres, free of all but the minimum corporate interference"... and one day suddenly the CPO is ejected from the system.  (This happened to a good friend of mine in one of the world's biggest companies!)

So the strategic mis-alignment could be around the organisation's overall aims; or it can be linked to process or organisational issues.  But the end result is the same.

And tomorrow I'll discuss why this makes me pretty positive - from a procurement point of view at least - about the prospects for the three London councils (Westminster / Hammersmith / Kensington) 'merging' their operational activities, including procurement.  But I'll also explain why I'm less positive, at the moment, about the prospects  for the Cabinet Office's centralised procurement for UK central Government (although I support it and wish it well conceptually).

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