Proxima Procurement Survey Suggests Mismatch With Business Priorities

Yes, it’s another procurement survey to tell you about – this one from Proxima, in conjunction with Supply Management. 400 procurement specialists responded, with an impressively global demographic, although as always it would have been good to know the size of the organisations represented and the seniority of the people.

The headline is that 53% of procurement respondents think that cost-cutting is what their organisation wants from them next year as the number one priority. However, most of the procurement professionals personally want to prioritise “adding value” as well as supplier management, ahead of cost savings. The commentary on the report says this:

This immediately begs questions as to whether procurement is getting ahead of the business and anticipating a requirement, whether the industry has failed to educate the business, or whether the need for cost savings is simply a mandatory requirement today.

We will come back to that in another article, because we do have another take on this issue. The commentary then points out that although value is such a priority for procurement, respondents are spending more on P2P and sourcing solutions than on supplier on-boarding and management tools. I’m not convinced that is really significant. Supplier onboarding solutions are often built into P2P for a start, and supplier management is generally a less mature sector of the procurement tech market. I would expect that investment there to grow as the products improve, really.

We do however like this inspiring bit of commentary from Proxima:

It’s time for procurement to re-set expectations, and drive the future of the industry. Changing business models require a different mind-set from procurement. Supply of goods needs to be faster, insight needs to be richer and based on accurate, accessible data – and the function needs to be able to react more quickly. The ability to drive cost savings and value simultaneously is already the new standard, and you need to have the tools and talent in place to deliver both.

Can’t disagree with any of that! And there are other interesting findings in the report; we thought the different levels of procurement influence across sectors was interesting data, and is worth further thought to see what it might tell us about how procurement can gain more influence generally. The fact that sales and HR were considered the “worst” functions for engaging with procurement was probably not a huge shock but that was a worthwhile question too!

In a couple of cases though I didn’t understand what the question was getting at – without carefully defining “supplier network”, this seemed meaningless. “Seven out of ten planned to make significant changes to their supplier network in the next 12 months”. Does that mean "network" as in your supply base, or your technology (network) platform, or … what exactly?

Anyway, despite a few such issues, it is well worth a look, and you can download it here.

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