The Procurement Value Proposition – Chick and Handfield’s Important New(ish) Book

The Procurement Value Proposition – subtitled “The rise of supply management” is an important new book from Gerard Chick and Robert Handfield. Chick worked for CIPS for some years as Head of Research, and is now Chief Knowledge Management for Optimum Procurement Group – and most impressively of course, an occasional guest author for Spend Matters!

I don't know him that well, perhaps surprisingly, but we have bumped into each other many times over the years. Robert Handfield I know only by reputation, but he is an eminent figure in the US procurement and supply chain world particularly, including holding a Professorship at North Carolina State University.

That all makes it hard to review their book totally dispassionately. It was published late last year, and I've found this a hard review to write. That is not because it is a disappointing piece of work, far from it, but more because the subject matter is so close to my heart, and because I expected a lot from the book! Therefore I found myself getting irritated at relatively minor points, and perhaps judging it too harshly as I went through it.

So trying to get a sense of perspective, let’s start by saying this is an impressive book, pitched at readers both in the academic and senior procurement consultant or practitioner worlds, I suspect. It has elements of a reference and educational work, and I'm sure will be on various procurement syllabuses soon, perhaps MCIPS or certainly post MCIPS level study. It is also a recommended read for the somewhat more intellectually interested and thoughtful senior practitioner.

Its primary importance to the profession lies in its core message, which is clearly and powerfully explained. That is the message of value as the central proposition and driver for procurement activity, rather than cost savings or transactional execution. This is a key message and whilst the authors are not the only ones to make this point (I like to think we have been going on about it for some time on Spend Matters, for a start), it is good to see it put across in an important book.

It takes a truly strategic perspective to the topic, looking at how procurement fits into the wider business world, and how broad changes and developments such as corporate social responsibility and globalisation are affecting procurement. The authors introduce the ACE model – Aspiration, Capability and Execution – as they get into some more practical thoughts and advice for senior procurement executives. Whilst the book is never as action and delivery focused as, say, Sigi Osagie’s recent work, it is far from a purely theoretical volume either, and much of this section I found useful and interesting.

There are many more positive elements we could highlight, but what about the slight irritations? There is an occasional flash of inconsistency in the messages; for instance, if much of the book is devoted to down-playing "cost savings," and is all the better for that, then it seems odd to quote favourably an AT Kearney survey that uses cost savings as the definition of top performing procurement organisations.

There is also a lot of material devoted to capability and skills and the procurement professional of the future. The problem with this topic, evidenced here, is that it ends up describing Mr or Ms Impossible. Describing a theoretical paragon of many virtues is just unrealistic - I'll immodestly claim the approach in our paper “The Four Faces of Procurement" paper is more grounded and useful, looking at it does at the various roles and different skills sets that various procurement jobs will require.

It is all very well saying that “procurement professionals today and in the future will need to be: professional, polished, intelligent, respected, influential, persuasive ...”  (and the list goes on further), but we’re not talking about the real world basically. “How can we get better at procurement with a bunch of moderately intelligent and enthusiastic people” is the more realistic question for most CPOs, I suggest.

The book also highlights the problems of bringing in topical references. Positive comments about the "Arab Spring" look horribly naive now, and “Given ... the current state of the UK economy people will have no option but to consider working in China, Brazil or India,” does not look as perceptive a comment as it might have in 2011 when it was probably written! Such remarks date the book precisely, and do it no favours; I'd suggest they need editing out if we see a second edition, which I hope we do.

But as we said earlier, I may be being somewhat nit-picking here, given the importance of the central arguments in the book and the clarity with which they are expressed. Anyone interested in where procurement currently is, and where it is going, will find much that is stimulating and thought-provoking here, and it is another welcome addition to the procurement library at a time when we are seeing a good number of impressive new books in our field.

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