Are CPOs and supply chain directors endangered species?

We are pleased to bring you this guest post from Garry Mansell, CEO, Trade Extensions. He is  a Fellow of CIPS and CILT , and from his perspective of more than 25 years' experience in the fields of buying, negotiation, e-sourcing and supply chain management, Garry talks about the changing roles and responsibilities of the procurement and supply chain functions. 

The last twenty-five years of my professional life have seen me involved one way or another in procurement and supply chain management. Firstly as a buyer in the Commercial Division of Mars, Incorporated and then as a supply chain manager in the same business. For the last 14 years I have used the expertise gained in these roles to build businesses that help others to buy and manage their supply chains, firstly with Freight Traders and now with Trade Extensions.

During this time I have seen many changes and I have been exposed to and worked with some of the world’s largest and most forward thinking companies and consultants. In Trade Extensions we have the pleasure of working with the majority of the Fortune 100 companies and we see how these companies are changing their view on the role of procurement and the supply chain. This post is intended to share with you some of this current thinking and the activities taking place that bring into question the very role of procurement in some of these organisations.

I do not plan to comment on the decisions taken to either outsource the procurement function or keep it inside a business. That can be the subject of a second post, and no doubt it will be a contentious one. Rather this is about the roles and responsibilities of the procurement and supply chain functions inside these huge businesses and how they are changing.

What we are seeing in large organisations is procurement and supply chain managers claiming the same areas of responsibility and acting as integrators of the supply chain, procurement and operations management functions.

These managers are doing this whilst still having to manage the cost base and manage the supply chain and multiple supplier risk management challenges. They are expected to use the supply base to drive growth and revenue for their employer whilst procuring goods and services both sustainably and responsibly. Add to this the need to manage macro-economic and political issues and you have tomorrow’s managers. This broader approach to achieving multiple goals is now becoming the norm, and the more traditional approach of segregating buying, supply chain management and operations management is breaking down.

So if the 'traditional' functions disappear, who will be left? I would contend that businesses with CPOs, Supply Chain Directors and Logistics Directors are already looking at these roles and asking themselves how they can be redefined. More importantly for the people in the posts, the question will be asked - if we have these three roles do we still need them all? Inevitably I think the answer will be ‘no’.

The managers of the future will probably be business generalists, experts in collaboration, but also highly skilled and capable of filling the new requirements. Perhaps these roles will be split by buying sector inside a business, for example marketing managers who can procure rather than buyers who can understand marketing. However companies choose to structure themselves, one consequence that does seem inevitable to me is that the specific roles of CPO and Supply Chain Director may well disappear.

 

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