In the last decade procurement operations have primarily focused on purchasing effectiveness: improving the skill sets of their staff, developing good negotiators, driving strategic sourcing activity, utilizing e-procurement tools to get deeper penetration and more control of spend (a center-led solution).
Moving forward, we need to truly understand and grow with the business. Transactional activity needs to be moved outside to third parties who can get this type of work done more efficiently and at a lower cost structure. Procurement leaders can then focus on developing their teams to become the people who are driving big, impactful, revenue generating, sourcing and total cost of ownership solutions. They can focus on building teams that have a strategic understanding of the lines of business and can then become a true partner for the business. Skill sets are changing from being good purchasing support to now being the supply based solution provider – someone who can sit and talk to the business leader and be able to provide a supply chain based solution.
3 Characteristics of a Next Generation Procurement Executive
1. Be a Visionary Leader – A visionary leader has a clear picture of what is possible, and they are able to transform their idea or vision into reality by mobilizing others to rise to the challenge, embrace a shared sense of purpose, bring their best talents and skills to the table and take action. They are also global in nature and collaborative. Their goal is to create a solution that is synergistic, melding all of the skill sets within the organization.
2. Know the Business – Become an internal consultant for the line of business. Understand how your business makes money. Understand issues, concerns and growth patterns of the business. What are the objectives over the next 3 years? Become a domain expert. Know the marketplace. Know who the suppliers are and what they bring to the table. Understand the competition.
3. Be a Change Manager – Most of the things that happen in the procurement world require change within the corporation: different ways of dealing with suppliers, dealing with different suppliers and the changing nature of the role of the suppliers. In order for you to become an effective change agent, you must have an executive presence. You must be respected within your organization and have power and influence. You need to understand what is possible within the organization based on what the supply chain can provide, understand the requirements, the investments and have the ability to put together a business case as efficiently and effectively as possible.
For more insights and additional profile characteristics of the next generation procurement executive, listen to Roy Anderson, GoProcure Investor on the podcast “Do You Fit the Profile of the Future Procurement Executive?”