Tim Cummins, IACCM Founder – Procurement Must Change

It’s a while ago now, but we went along to the successful IACCM Forum in London at the lovely Hurlingham Club (pictured) - you can see our articles about it here, here and here. We also took the opportunity to catch up with Tim Cummins, the founder and CEO of the organisation, for a chat.

We started by asking him if there was anything he would do differently for the next event? "Well, I probably wouldn’t go off travelling on business for five weeks just before the event" was his instant response! We then moved onto some more serious questions, which touched on some issues around the future of procurement and contracting generally..

What is the overall message coming from the event?

"The keynotes have been fundamental indicators of what is going on. Given the pace of change in the business world, the level of integrated commercial skills is not keeping up with the need. That is true on both sides of the deal, buy-side and sell-side, organisations don’t have the embedded capability, and applies both sides of the contract. Procurement people may try and convince themselves they know what is needed but we're not so sure".

Do you see any boundaries between the “procurement world” and the IACCM world? Are there elements of the procurement role that are outside the scope of IACCM for instance?

"The procurement process and priorities are changing to fit the IACCM worldview, we believe. Trading relationships are at the heart of firms’ operations. Suppliers are also customers, and top management expects coherent relationship behaviour. Meanwhile the scale of automation is eliminating traditional procurement and operational roles. At IACCM we aim to develop a consistent body of knowledge about those key trading relationships”.

Surely there will still be non-strategic, more tactical buying and selling going on in this future world?

"There will still be a commodity world, but it will be heavily automated. Then there will be the outcome and output driven, payment by results world, with longer term and more complex relationships. Risk management, quality and integrity along with value generation will be key here".

Your vision of the future – with these complex collaborative trading relationships, with many different people in the organisation involved with them, is very different to the CIPS “licence to practice” vision, with qualified procurement staff as "gatekeepers" to the outside world. What do you make of that idea?

"I fear it will be perceived by many as a “restraint of trade” move. Businesses and senior managers want enablers, not people who want to stop them doing things. And we’re seeing even the traditional professions breaking down. Doctors are not very good at spotting and diagnosing rare diseases; “crowd-sourced” websites are far better. Even the rarest diseases are diagnosed in a few months whereas it often took years of problems for the sufferers before their condition was identified. And by the way, pharma firms are going to be paid on results”.

What sort of a reaction to IACCM do you get from procurement people?

The range of views is very broad. Procurement is a contributor to commercial capability in an organisation – but it is not the total source of that capability. Some see the opportunity, some sectors, individuals and organisations more than others. Finance and HR as functions have made the transition over the last the years, from bean counters to strategists. Procurement has been left behind somewhat but things are now happening in leading organisations. Procurement must be a business enabler, not a ball and chain”.

Does procurement have the leadership to make that happen?

“I don’t know. But I was talking to a global level head-hunter recently who told me that 90% of current CPOs in their view would not make it in the new world”.

What about the developing world – is this a maturity thing, do they need to go through the “old world” of transactional procurement and gatekeepers first?

“Not necessarily – going back to the medical analogy, it is doubtful that those countries will replicate our model of healthcare with GPs for instance. So developing countries may jump straight to something more appropriate for the current world. The IACCM is doing some work in Angola, where the oil and gas industry is certainly grasping the importance of strategic contracting skills”.

So is that global expansion part of the IACCM strategy?

“Yes, we're getting stronger in the Middle East, we have just had a diamond mine in Botswana sign up as a member, and we have appointed a regional director for South America, Australia and New Zealand”.

 

Thanks to Tim Cummins for giving us his views of the future. There is no doubt that IACCM is already very relevant for procurement practitioners, and should be on the radar in terms of what the organisation can offer. Cummins has some pretty bracing views about the future of "the profession" - I'd love to get him and David Noble (CIPS CEO) debating this in the same room! That would make a brilliant Spend Matters pub debate, wouldn't it ...

First Voice

  1. David Atkinson:

    It sure would.

    Tim is one of today’s great thinkers in our field, and his wisdom would quite easily overcome the ‘restraint of trade’ argument.

    It’s the future, innit?

Discuss this:

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