An interview with Professor Andrew Cox: procurement guru or provocateur? (Part 3)

Here’s the third and final part of our interview with Professor Andrew Cox of the International Institute of Advance Purchasing and Supply, and we’re turning our attention away form IIAPS to some more general thoughts about procurement people and the profession.

And after twenty years of working with and educating procurement people, Professor Cox has some strong views on the strengths and weaknesses of the profession.

“If you look at the end to end sourcing or procurement, typical areas of strength are in the middle of that process – around negotiating, and forming contracts.  Perhaps running competitive processes. The situation is much weaker in both upstream and downstream processes and issues”

He sees that upstream, procurement is weaker in terms of working with stakeholders to define needs, or challenge requirements. And downstream, procurement still has limited involvement – perhaps because of the competence issue – around contracting and supplier management.

“Procurement people tend to be process driven – they're less good at getting results through others” says Cox. When he speaks to stakeholders and budget holders about their procurement issues, they often say “we don't get this level of challenge from our own procurement people”.

Some of the 'softer' skills needed are generic, explains Cox, like 'building relationships'. Others may need a blend of generic and organisation specific, such as negotiating. So he is looking within the IIAPS framework at how to bolt on more education and perhaps even assessment in these softer areas of competence.  What about the future outlook for procurement?

Does he share the view that Professor Lamming* – another distinguished academic in our field – proposed, that one day most procurement would be done by 'a computer, a dog and one man'. The computer does the work – interfacing with other computers to source, plan and transact most procurement activity. The man turns it on in the morning, and the dog is there to make sure the man doesn't touch it again once he's turned it on!

Cox doesn't go that far although he does see a lot more scope for automation in the procurement process – suppliers able to automatically update information and RFPs, market analysis being built into supply platforms for instance. And he certainly sees the need for procurement professionals to develop more competence. “Technology makes life easier for non-procurement stakeholders; budget holders and so on. So procurement will have to work harder to show what they bring to the table”.

And in general, people who sit outside the 'procurement department' will become more critical to the overall organizational supply chain performance.  This takes him back to some of his long-established views on the dynamics of supply chains and the organisations within them. Why do we have functional silos? As supply chains and networks get more complex, they are less and less appropriate, he thinks. These external structures and organisations become so integrated with, and critical to, the business that you cannot divorce a 'procurement function' from the core operational part of the organisation.

“As we outsource more of our business, we need to move away from the concept of 'procurement' as a separate entity” he says.

But we will still need people who can ask questions, and challenge both within the organisation and with suppliers. So perhaps we won't have procurement functions in the way we do now – but the skills we value in procurement currently will still be needed and in demand in our organisations. Let's hope so anyway...

There was a bit more to Lamming's vision to be fair...I have simplified somewhat.

First Voice

  1. John Licht:

    With transportation cost rapidly increasing, critical shortages of components (Japan, New Zealand, & Australia natural disasters) and soon skilled work force shortages (driver situation), one wonders why more CFO and CEO are not more active their supply chain management functions.

    JML

Discuss this:

Your email address will not be published. Required fields are marked *