Key Procurement Tensions/Trade-offs for 2017 – Specialist Knowledge versus the need for Business Skills

A few days ago, we outlined five key areas of interest or tensions maybe for procurement in 2017. We are now looking at each in a bit more detail, and in each case, we give three key actions for 2017 that might strike a chord for you. Today, our tension is that between the “procurement profession” and associated specialist knowledge versus the need for business skills.

This is perhaps the most commonly debated topic at procurement conferences, yet to be blunt, the level of real analysis and thought in much of that discussion is weak to say the least. There is a lot of talk about procurement people needing stronger general business and interpersonal skills. From financial analysis and project management (core business skills perhaps) to empathy, persuasiveness, and tenacity (interpersonal skills or qualities), there is generally much nodding of heads when a CPO stands up and declares that these are now essential and “more important than knowing how to run an RFP or write a contract”.

There is some truth in this – coming back to yesterday’s article, quite a proportion of the traditional skills and knowledge may well get automated and AI’s out of the procurement job description. Already, contract drafting software can do much of that work, and the simplest sourcing software could be used by a bright 10-year-old.

Yet there is a dilemma here. If our procurement “professionals” become simply smart people with project management skills who are “good with people”, then what exactly is it that makes them procurement people rather than simply business managers (or marketing, HR, or operations managers whose job includes a certain amount of working with suppliers)? The question is whether there is still a core body of knowledge and skills that can be labelled as “procurement”, and that is useful to organisations.  If procurement has a future, just what is it that we can and should do, remembering that it should be something our internal stakeholders can’t or don’t want to do for themselves?

We believe for what it’s worth there is a role for something in the future that we might call “procurement”, or might equally be called something subtly different. And really, this is a wider issue than for any one organisation or procurement leader, but three thoughts anyway:

- As in our last article, get ahead of the game in terms of understanding where and how existing procurement work might and perhaps should get devolved to users. Start thinking about what that means for skills and indeed resourcing levels and structures.

- Think about those skills and activities, considering the widest possible procurement / contract and supplier management picture, that relate to where our internal stakeholders and colleagues will still need some specialist support, and above all where the “new procurement function” can add real value and competitive advantage to the organisation.

- Don’t throw the baby out with the bathwater; by all means focus training and development on business and inter-personal skills, but remember that we need to offer something that every business manager does not have. For instance, we believe that deep negotiation skills and an understanding of complex commercial and supplier performance models are two areas that cannot be automated and will be valuable specific skills for those currently designated procurement professionals.


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