“Leading Procurement Strategy – Driving Value Through the Supply Chain” Book Review (part 2)

Book proc startegyWe started our review of Leading Procurement Strategy – Driving Value Through the Supply Chain   (from Mena, Van Hoek, and Christopher) last week and I explained my frustration with some errors in the book, which took the edge off some other impressive aspects.  But there are a couple of major “problem chapters” too.

The chapter titled “Information Technology in Procurement” could have been written a good ten years ago, and I can't see it helping many contemporary professionals. It focuses on what is now just a subset of relevant and available procurement technology - basic purchase-to-pay, auctions and catalogues - and that is it.

Now to be fair, the author does say that this is “not a comprehensive list of applications and models which are sometimes grouped under the e-procurement banner,” but the choice of what is included seems strange. For a book that is badged as strategic, the focus here is on the least strategic area of procurement technology – purchase-to-pay. But it does include a certain amount on auctions, which fits with sourcing – so why not e-sourcing or optimisation, both arguably more "strategic " than auctions? Even within the transactional field, recent growth areas such as e-invoicing and supplier networks are barely mentioned.

Now it may not be surprising that real leading-edge technology thinking is absent (for instance, social media-type tools, linking e-invoicing with dynamic discounting and supply chain finance, real-time spend analytics, taking optimisation into planning and capacity analysis). But well established tools are also largely missing. E-sourcing, probably the most important element of the procurement technology picture, gets literally one short paragraph. Spend analytics, optimisation, onboarding and supplier information management, contract discovery and management tools, SRM or risk management platforms ... nowhere.

The chapter on the future of procurement is the other big disappointment; here‘s a quote.  "Category management will become one of the main elements of procurement in the future.”

Really? "Will become ..."?  Category management started to gain mainstream acceptance in the 1980s and I’d argue that it is now past its peak actually. It may remain important, but it is hardly the "future of procurement." The picture of the future seems to be merely a continuation of the past, with nothing radical or disruptive and barely a mention of technology. The “new technology” that procurement needs to be aware of (page 201) includes EDI (1970s) and ERP (1990s).

The section on the skills procurement people will need just throws every ‘skill’ you could think of at the wall and suggests the answer is “all of them.” Contract management suddenly appears as a future “key skill” area – that’s interesting, let’s look it up in the index to see where else it is discussed – nothing in the index (back to my moan about the index from part 1!)  The best part of this whole futures section is actually a lengthy segment from a 2012 Economist article.

OK, let's finish on a positive note. Despite my hatchet being fully sharpened for the last few paragraphs, this is a book that is worthwhile for many procurement professionals and I would want a copy (or two) in my Department if I were a CPO.

It contains strong and useful material on many topics, including the strategic role of procurement, global sourcing, SRM, risk management, etc, all covered intelligently and at an appropriate level of detail for most senior procurement readers. As we discussed in part 1 of the review, there is particularly useful advice for the CPO looking to get better alignment and strategic acceptance in their organisation. It's just a pity it  isn't all up to the level of its better parts, we'd advise readers not to take it all as gospel (there are errors), and to focus on the more valuable and worthwhile chapters.

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