All posts by Tania Seary

4 Big Ideas That Transformed Procurement Technology

The Big Ideas that will shape the future of procurement technology will be one of the hot topics at the Procurious Big Ideas Summit in London on April 30.

4 Big Ideas in Technology that will transform supply chains

That’s why we’ve invited leading technology influencers like Tim Hughes, Lance Younger, Peter Smith, and Mark Perera to be “in the room”, and provide their views on which technologies procurement professionals should keep in their cross hairs.

I think it was Machiavelli said, “whoever wishes to foresee the future must consult the past.” My belief is also that it sometimes helps to look in the rear view mirror, to understand what is coming up on the road ahead.

In this article I look back in time and share four of the Big Ideas in technology that I believe have helped shape the procurement profession as we know it today – common protocols, online catalogues, reverse auctions and barcodes.

From the outset, let me stress that I am no technology expert and that my list of Big Ideas in Procurement Technology was conceived under the palm trees of an island in the Indian Ocean. Some may say this provided me with perspective, others may say I’m deluded. Let’s see what you think!

Common protocols – EDI & cXML

Establishing common protocols for the exchange of business transaction data (such as purchase orders, invoices, shipping notices, and many others) provided the basis for the globalization of procurement and the demise of the paper and fax era.

Electronic data interchange (EDI) emerged in the late 60’s and focused on machine-to-machine transactions, but it proved cumbersome for the internet. In light of this, in 1999, Ariba created Commerce XML (cXML), which subsequently became the primary universal protocol for B2B interactions over the Internet.

Electronic catalogues

eProcurement came about as a way to conduct all sorts of purchasing transactions over the Internet, and marked a significant turning point in the use of technology for procurement.

Sometimes I wonder whether all the major eProcurement developments happened at the same time in the late ‘90s and we’ve just spent the last twenty years working out how best to use them, with the software companies refining the offerings in line with our demands.

Electronic catalogues were one of the first of the applications to be developed in the eProcurement suite.

It is easy today to think of this as a pretty basic development, but if you put it in context, consumer online shopping sites such as Amazon and eBay were only launched in 1995. Less than five years later, the corporate world was introducing its own, business-appropriate, form of online shopping.

The subsequent difficulties with managing in-house catalogues gave rise to the outsourcing of catalogue management, the creation of eMarketplaces and a whole new category of eProcurement applications and software providers that have flourished ever since.

Online reverse auctions

I LOVE a great reverse auction. Always have.

What I love most about reverse auctions is the need to follow a disciplined sourcing process in preparation for the event. I think this is one of the great, unsung benefits of this tool for the profession. Don’t worry, I have also heard all the downsides to online auctions. I know they have their place and that’s another reason why I love them – they are a weapon to be used selectively with great effect.

I love the story behind the creation of the online reverse auction – the Glen Meakem story. I was lucky enough to be both living in Pittsburgh when FreeMarkets was it its height, and also to be one of their customers. They were an impressive organisation.

Legend has it that Meakem conceived the idea when he was at a supplier negotiation day with GE. At that time, suppliers were marched into individual rooms Wal-mart style, interrogated, sent outside, then brought back in after their competitors had finished the same meeting. Flip charts were used to track pricing as it trended downwards.

Meakem had the idea to take this practice online and allow the negotiations to take place real time. Surprisingly, GE didn’t want to invest in the idea, so Meakem went out on his own, hiring McKinsey colleague Sam Kinney, and founding FreeMarkets with the purpose of facilitating the online tender process and running global auctions.

Reverse auctions proved to be a turning point for procurement, as they reinforced to company-wide suppliers the importance, and power, of a centralised purchasing team.

However, what I think makes reverse auctions most significant for the development of our profession is that not only did they really capture the attention of the C-suite, but also the rest of the organisation.

I remember hosting boardroom parties where colleagues from all parts of the business could come and cheer as they watched the prices being bid plummet. It’s not every day your colleagues get excited and stand up and cheer for procurement. It was a nice moment, and provided a great opportunity for procurement to demonstrate its value.

The Codes – The Bar… becomes the QR

I am certainly no barcode expert, but it is quite conceivable, as one story put it, that “no event in the history of modern logistics was more important” than the invention of the barcode.

Apparently, the first retail product sold with a barcode was a single pack of chewing gum at a supermarket in Troy, Ohio on June 26, 1974.

Forty years later, the latest incarnation of the bar code is the QR code (Quick Response Code) which is the trademark for a type of matrix, or two-dimensional, barcode.

The QR code has quickly become popular due to its fast readability and greater storage capacity compared to standard barcodes.

Where this development becomes very interesting is in today’s world of supply chain disruptions, where the QR can assist with product and time tracking, item identification and more efficient document management.

Given the procurement profession’s increasing need to guarantee supply chain transparency, the QR code could help provide some of the answers we need to protect our brands in the future.

The Big Ideas that will shape the future of procurement technology will be in the spotlight on 30 April at the Big Ideas Summit.

Procurement professionals around the world can get involved, and join Procurious’ 5000 members, as digital delegates by going to the Big Ideas Summit website and tweeting your Big Idea using #BigIdeas2015

You can also share your views on the ideas you believe disrupted procurement technology in the Procurious group.

7 ways to inject love back into your supplier relationship

As part of a Valentine’s Day special, our founder, Tania Seary (who has a long-standing love affair with all things procurement), is exploring ways that procurement professionals can ensure everyone they touch can “feel the love”. So far we’ve covered community and stakeholders…. now to focus our attentions on our favourite audience of all – our suppliers.

7 ways to inject love back into your supplier relationship

Given that Valentine’s Day is only hours away (and I’m encouraging procurement professionals around the world to make sure everyone they touch “feels the love”), I thought you might like some tips to inject the love back into your supplier relationships.

In supplier relationships, as with romantic relationships, there unfortunately comes a time when the romance fades away…

While the relationship with your beloved strategic supplier may have grown stronger (and more co-dependent each year spent contracted to each other), the romance, the sparkle, the mojo, that desire to impress, often dissipates into a very boring business-as-usual patter.

As leading best-practice procurement practitioners, we all know this is a bad thing – because theoretically we need to be continually improving the value delivered from our strategic suppliers. And unfortunately when the sparkle starts to disappear, or one partner starts to feel neglected, then the cracks start to appear. The bond may break and you are in the law courts with your separation clauses under the microscope. On the other hand, a healthy supplier relationship is productive – it drives out costs, inefficiencies and spawns love children in the form of innovation.

Let’s face it; maintaining a strong working relationship (whatever the setting) requires effort. As we say at Procurious, you have to give to receive.

While researching (well, let’s face it, Googling) this topic, I stumbled across a very practical set of advice from one Ms Monika Mundell: 7 ways to inject romance back into your relationship.

I realised that there were some amazingly scary parallels for we procurement folk. So, I’ve reworked Ms Mundell’s 7 tips to provide you with some shine to put sparkle back into those all-important strategic supply relationships.

  • Eye gazing: Even though I’m obviously a true-believer in social media, I am also a true-believer in the good old face-to-face meeting and telephone call to build understanding relationships. Too much gets lost in translation when we are emailing, texting and tweeting. If we are to keep the relationship alive, we must meet with our strategic suppliers regularly to ensure we fully understand the status and nuances of the relationship.
  • Book a romantic surprise getaway: OK… not really appropriate – but think about it… When was the last time you and your supplier got your leadership teams together to think of ways of both getting more value out of the relationship? You could have a “staycation” and have a one or two-day conference in your offices, or book a mutually convenient off-site location to help facilitate bonding at all levels. A getaway could really identify some fresh ways to invigorate the relationship and add more bottom line value for your shareholders.
  • Touch your partner more often: OK, now you’ll be thinking I’ve really crossed the line here… but think about it. How many touch points do you have with your supplier, and are you using all the different communication mediums available to connect with them at all the appropriate levels in their organization?
  • Write a love letter: Seriously, when was the last time you wrote an email, a letter, a card, showing appreciation for something your supplier did for you? In a day and age where people are running around crazily ticking items off their to do list, a considered, well-penned note means a lot more than it ever did. Take some time out – formally thank your supplier – and I am sure you will feel the love reciprocated in some way or form into the future.
  • Surprise your partner with a romantic dinner: I was really touched when a long-term client and his wife took me to a five star restaurant last year – and paid on their personal credit card. As my clients know, I am very dedicated to them all and I was really touched that this couple took time out of their busy diary and budget to treat me to a special meal. Think about it…
  • Spend more time together: According to Ms Mundell, a common cause for drudgery in a relationship is the fact that we disconnect. All of the points above provide you with opportunities to spend more time with your suppliers. But remember, it doesn’t always have to be elaborate, or premeditated, just spending simple time together on-site, on the job, in the warehouse or with your joint customers is all very important time invested in building that all-important relationship.
  • See a counsellor – OK there’s a reason why this is obviously my last point – because it’s kind of a last resort if all else is failing. At my procurement management consultancy, The Faculty, we’ve often considered developing a “strategic alliance counselling” service… not unlike a marriage counsellor! When thinking about how to re-ignite the spark in your supplier relationship, don’t underestimate the value of getting a third party involved to take an objective view of how your partnership is performing. While you probably won’t need to recline on the chaise lounge, a healthy review could offer some fresh insights into how both sides of the partnership could potentially change their behaviours for the greater good.

Are you making sure your suppliers “feel the love”?

Hey! Procurement – make your customers “feel the love”!

Important lessons from Gustave H and the Grand Budapest Hotel

What can we learn from The Grand Budapest Hotel?

A quick office survey revealed that no matter how much the boss likes it, ‘The Grand Budapest Hotel’ is not exactly everyone’s idea of a great movie.

However, the adventures of Gustave H; a legendary concierge at a famous hotel from the fictional Republic of Zubrowka between the first and second World Wars – provides a lot of great (quirky, yes) insights into what constitutes exceptional customer service.

In the procurement world we often refer to those we serve to please as ‘stakeholders’… but let’s face it, they are our customers and all the old-fashioned principles such as “the customer is always right” apply.

Of course we want to do more than serve – we want to become a trusted advisor. But time and time again, ‘stakeholder engagement’ and the ‘soft skills’ re-appear as the number one skill that CPOs need their team to develop, in order to achieve that ‘trusted advisor’ status.

So in the spirit of ‘sharing the love’ this Valentine’s Day, here are some of my customer service learnings from working with clients, customers, stakeholders and alike during the last two and a half decades.

5 ways for procurement to make sure communities “feel the love”

Know your RFQs from your Ps and Qs

Nothing sells like credibility.  If you are going to put yourself forward as an advisor, you need to know about both about the professional service you are offering (procurement) and your customer’s business.  Knowing neither or only one or the other, is not going to build enough confidence for your customer to engage with you.  You need to ensure you have adequate procurement skills, as well as understand the business you are in to make the grade.

Make sure you get through to the second round

The analogy here to a boxing match is not accidental.  I have had some very tough first meetings with my customers. Let’s face it, not everyone always wants procurement’s ‘help’. A large part of our profession’s heritage has been about convincing our stakeholders about the value we can deliver.

From my chilly desk in Pittsburgh over a decade ago, I can still clearly remember being yelled at down the phone from my business unit customers in Iowa and Texas.  One CPO screamed, “If you want my team to spend their precious time on some corporate scorekeeping folly, then get your a** down here on a plane and explain it.”

Gustave H provided a light bulb moment for me about these aggressive experiences:

“Rudeness is merely an expression of fear. People fear they won’t get what they want. The most dreadful and unattractive person only needs to be loved, and they will open up like a flower.”

I can’t say that any of my customers have ever “opened up like a flower”, but they have definitely mellowed from their initial opposition.  Once you prove you can deliver, they’re putty in your hands.  But you have to be resilient and work through this initial push back – get them to the point where they really start to engage and invest in you as a professional who can help them on their journey.

Know what they want; know what they don’t want

When my best practice procurement company, The Faculty, is helping procurement teams to become more customer-focused, we talk about the five false assumptions about customers:

  1. Customers know exactly what they need
  2. Customers will tell you what they need without being asked
  3. If you ask, customers will tell you everything they need
  4. If customers tell you everything they need, you will understand completely
  5. Just because you know what your customer needs, doesn’t mean you’ll be able to convince others in your team

Procurious blogger, Jordan Early, shared with me some really interesting research from Deloitte’s Ajit Kambil, who researched how new finance chiefs often undertake listening tours to understand what their key stakeholders want.

He observed that what stakeholders say they want “may not express their entire universe of so-called wants”. For example in our world, a business-unit leader may say he needs better information and support from procurement. But his true want may be “to be really listened to” by the procurement organization; or he may want procurement to “help support the personal initiatives he believes will advance his career.”

Kambil also suggested that knowing what key stakeholders do not want is as important as knowing what they want. When I was working in procurement within a large organisation, I used to present three potential contract award scenarios before we kicked off a sourcing project. This quickly revealed how the customer would react to different award decisions and helped bring on the conversation about what they didn’t want early on in the process.  It saved a few (but not all) tears at the end of the project.

Knowing what customers truly do or do not want begins by asking questions. However, it is often difficult for stakeholders to clearly articulate what they do and do not want. This is where you really need to call on all your business experience (and hopefully your supportive boss and/or mentor) to help you truly understand your customers’ needs.

Oh, and then you need to deliver. That’s the easy part… right?

5 ways for procurement to make sure communities “feel the love”

5 ways for procurement to make sure communities “feel the love”

The words “love” + “procurement” aren’t often seen together, but here at Procurious we’re hard at work changing the face of procurement.

As part of a Valentine’s Day special, our founder, Tania Seary (who has a long-standing love affair with all things procurement), is exploring ways that procurement professionals can ensure everyone they touch can “feel the love”.

5 ways for procurement to make sure communities “feel the love”

At Procurious, we’re very social (both on and off the field). You usually hear us talking about the benefits of social media, but this time we’re talking about the benefits of getting involved in social procurement… that is – using your corporate spend power to award contracts, to social enterprises and local businesses to generate social benefits beyond the products and services required.

Feel the power

There is enormous untapped potential for social procurement to act an agent for social change – our profession can make a huge impact!

Social procurement creates jobs and opportunities for people who may have struggled to find work and can also reinvigorate depressed or marginalised communities.

Not only are we helping our communities “feel the love”- but we’re also helping our own company. Spending money with community groups and social enterprises improves our own company’s staff engagement, brand equity and enables us to do something that is truly socially good without compromising financial return to shareholders.

So now it’s not only the corporate sponsorships and social responsibility teams who get to help those in need – procurement can also make a huge contribution to the community.

Choose your weapon

Embedding social procurement into your existing procurement framework will require some changes.  And, as we know, change isn’t always easy, so you’ll need to be both creative and patient. According to Dr Ingrid Burkett from the Centre for Social Impact in Sydney, you have four options (“weapons”) for initiating social procurement within your organisation:

    1. Contract – The most obvious approach is to incorporate social impact requirements into tenders, new or existing contracts, or evaluation criteria.
    2. Policy – You may choose to use policy to ensure you meet your social procurement objectives – these can include requirements such as percentage of spend for social impact, meeting statutory or regulatory requirements and local supplier spend commitments.  For example, many mining companies use a policy approach that mandates each of its mines must have a documented strategy for local procurement that is endorsed by the senior leadership team.
    3. Supplier – Directly engaging with suppliers who have a mission to deliver social value is one of the most common approaches to social procurement.  Many social enterprises have independently integrated themselves into corporate supply chains by winning tenders without specific consideration to social value.  In fact, without being deliberate about it – you are probably already procuring from social enterprises.
    4. Market (supplier) development – If you want to work with social enterprises but there are none operating in the category required, you will need to innovate.  For example, in planning the establishment of the Diavik Mine in Canada, Rio Tinto developed local suppliers capable of meeting their expected future business requirements through training, local employment initiatives and by stimulating contracts for these businesses.

Be credible and creative

Once you have worked out the “how”, the next step is obviously to choose the most credible social procurement options to suit your company’s business objectives, profile and culture.  Try to be creative about the “best fit” for your organization.  The best example I have heard of was a major retailer, who sponsored a bike maintenance service at their national headquarters.  Unemployed youths were engaged to learn how to fix bikes and earned their way to a trade certificate, while employees were encouraged to get fit and ride to work and help reduce carbon emissions!  How many boxes can be ticked with one initiative?

Get your CEO into the picture

Literally… if the category and social enterprise you have selected ticks all the boxes for your organization (strategy, mission, other initiatives etc.), then use your marketing nous to convince your corporate affairs and media executives that the CEO should do a site visit and understand the company’s commitment to the selected social enterprise.  Make sure there’s a photographer there (mind you, I’m sure your company’s PR gurus will have this covered) as this is exactly the type of material that gets featured in annual reports.  Perfect.

Persevere

Social procurement is not “business as usual” – it presents unique challenges and opportunities for both the buyer and the seller.  Successfully introducing anything new into a large organization is difficult.  The greatest challenges to introducing social procurement is having enough people and time, identifying appropriate categories of spend and gaining organizational commitment.

For social procurement to be effective there needs to be a truly enabling environment:  this includes senior management support, the right tools and infrastructure to support it, establishment of effective supplier networks and increased community and government recognition of its importance.

So, do you know how to “show the love” to your communities?  What’s your story?

5 disruptive forces that will keep CPOs awake at night in 2015

CPOs around the world may have some sleepless nights in 2015 as they defend themselves and their companies against powerful disruptive forces.

5 things to keep you awake at night

In the true spirit of social media, I’ll highlight just five of these disruptive forces and have created the convenient “METOO” acronym to cover – Markets, Ethics, Transparency, Optionality and Organisational alignment.

2015 is the time to make sure you have your bases covered in these areas:

Markets – We would be naive if we didn’t expect more market volatility in the coming year.  In 2014 we saw interest rates remain low, the Rouble depreciate 50 per cent, the Australian dollar depreciate 20 per cent, oil prices drop 50 per cent, iron ore prices drop 40 per cent and Chinese growth at its lowest since 2009.

As we are all exposed to the instability of global markets, CPOs will need to decide how to either protect or profit from this volatility.

Ethics – Some leading global retailers had their public reputations shattered last year with revelations about unscrupulous and bullying behaviour towards their suppliers. CPOs will need to have a clear conscience that they are using squeaky clean negotiation techniques and are taking demonstrative actions to ensure their team, and the entire organisation, has a healthy and ethical approach to managing suppliers.

Transparency  – Discovering that one of your third or fourth tier suppliers is involved in corruption, using child labour, unsafe work practices, or substituting lower quality ingredients or parts will be the stuff of nightmares for CPOs in 2015.

A focus on supply chain transparency will see a whole lot of quality assurance consultancies, and other intermediaries, busy in this booming sector of the services economy.  As one of my mentors has always said, “better to know you’re right, rather than hope you’re not wrong”.

Optionality – Talking recently with a federal government defence advisor and the CPO of a leading European telecommunications company, really brought home to me the dilemma of developing and managing suppliers as we move to operating in an era of the “Internet of Things”.

More than ever, we are actually buying technology more so than the actual product or service (think driverless mining trucks – we’re really buying the technology to manage and maintain these vehicles, more so than the trucks themselves).

As technology increasingly becomes the product, we need to keep our options open in order to take advantage of the frenetic pace of change. Our tenders and contracts will need to more broadly define the functionality and utility we require of a product or service, rather than the exacting specifications we know today.

We will also need to ensure we keep our minds, doors and sourcing processes open to engage new suppliers with break-through technologies.  With most contracts being around 3-5 years long, CPOs will need to build optionality into their contracts to ensure they have the agility and can be opportunistic in adapting and adopting new technologies.

Organisational alignment – Procurement teams today are well-versed at “finding the money” and negotiating great deals that should result in bottom line savings.  That’s 101 stuff – our traditional raison d’etre .The trickier challenge has always been to “keep the money” and make sure that contracted savings actually make their way to the bottom line.

Today’s CPO has to work harder than ever to make sure “everyone is on the bus”, utilising negotiated contracts and treating every dollar as if it were their own.

Creating cost-conscious cultures is a huge change management exercise that requires a vastly different skill-set from the CPO’s traditional tool kit.  This challenge, teamed with frequency and voracity of carpet-pulling and direction-changing that will go on in the boardroom and C-suite this year, will require a lot of creative thinking and schmoozing by leading CPOs.

Anyone need a Xanex? (Is that a sleeping tablet?)

If you agree with my thoughts or have want to comment on the forces impacting procurement in 2015 – please Tweet #metoo #bigideas @taniaseary or just respond “me too” on LinkedIn or Procurious.

5 point checklist for a great procurement boss

What are the qualities that make a great procurement boss?

Gossip, scorekeeping and throwing you out of the office certainly don’t sound like the traits of a great leader… but read on and you may change your mind.

How to be a great boss

I’ve been told that in this day and age employees choose bosses, not companies, when choosing their next job.  In 2014, our Procurious community provided their thoughts on what makes a great procurement boss.  So, as we kick off the New Year, I thought I would share five things I think you should look for when selecting your next procurement boss.

Ask yourself, are they a CPO who:

  1. Kicks you out of the office.  As helpful as water cooler chit chat and Google can be for finding answers to your questions, there is nothing more valuable than getting out of the office and meeting with your customers and suppliers.  Your internal customers will be impressed that you have made the effort to come and visit them and understand how they use the product or service you are buying for them.  Similarly, actually visiting a suppliers’ office or plant will help you understand a lot more about that category you buy and identify new ways to add value.
  2. Fills you in on the goss’.  While it’s not appropriate for your boss to share all the intricacies of what’s happening within the upper echelons of your business.  It’s important that you know enough corporate gossip so that you can expertly manoeuvre yourself and your projects through the minefield of personalities and relationships that make up your business.  Stakeholder engagement is one of the most important skills required to be a successful procurement professional, so understanding “the lay of the land” is critical to your success.
  3. Helps you keep score.  Whoever you are in an organisation, you need to demonstrate the value you are delivering.  In procurement, this often means savings, but it should mean so much more than that.  Your boss should work with you to explain how your role links to the delivery of the overall business strategy and how all the different dimensions of your role deliver value – efficiency, productivity, innovation, customer service and other non-cost related value drivers are all important conversations to your CEO.
  4. Has a game plan.  Yes, your boss should have an overall plan for how their team is delivering against the overall business strategy, but they should also have a plan for you – both for what you need to deliver and how you need to develop in the coming year.  The best CPOs I know are obsessed with finding the best people and helping them develop.  They send their people out to be trained up in the skills they need and to build peer networks that will develop their leadership skills.  The worst CPOs keep their category managers locked away from the rest of the world in fear that their people will be poached.  A great CPO doesn’t need to worry about this, because they know that they have developed a great employee value proposition that keeps their team engaged… and retained.
  5. Is a bit of a procurement rock star.  If your CPO is well known and has a strong peer network, this provides you with a type of insurance policy that they know what they’re talking about and will hopefully be a great teacher.  However, you need to be careful that they’re not so committed to building their own profile out on the speaking circuit that they’re not providing enough support to their team.  A healthy balance between managing their internal and external relationships should provide you with a leader that connects you and your organisation with the outside contacts it needs to “stay in the loop”, while keeping everyone on track within your organisation.

How you are going to assess your potential new boss against this checklist when you are outside the organisation? This is where your network becomes invaluable.  You will know someone who knows someone (use LinkedIn or Procurious to see the connections) who has worked for your target boss.  Contact them, have a chat, see how the CPO measures up.  The most telling sign of success is how the CPO’s employees have been promoted both within and outside the organisation…

Good luck!

Podcast: Social Media for Procurement

ATK helps put procurement in the drivers’ seat with social media

Social media in procurement podcast. Image Pixabay

A.T. Kearney’s Knowledge Director, Helen Clegg, is spearheading the discussion for educating the procurement profession on the benefits of social media.

Hear my interview with Helen http://bit.ly/14VDC1x where I share how to leverage social networks, from building relationships with suppliers to receiving real-time news about supply chain disruptions.

On the topic of risk, I share with Helen my view that there are more risks to procurement professionals for NOT being connected with social media, than there are to being involved.

I also share my top tips for building a social media presence, as well as recommending that everyone finds a millennial mentor!

If you find it useful, I would love you to share it with your Procurious network, on LinkedIn or over Twitter?!

Are we the golden children of procurement?

When the CEO of one of the world’s largest resources businesses, Sam Walsh, says he believes procurement has entered a “golden age”, it certainly makes you think – could this really be one of the most prosperous periods of our profession’s history? And, if so, what are we doing to capitalize on this opportunity?

Remind yourself what Sam Walsh said on Procurious

Are we the golden children of procurement?

From the perspective of my 15+ years in the profession, I am confident in saying procurement professionals are in the midst of some very exciting times… and here’s why: 

  1. Our roles have never been so complex and therefore as interesting.  Today’s procurement professionals must manage all the expectations of their 360-degree stakeholders, up-skill and engage their teams, deliver an advantaged supply base, and all the while, keep their own careers prospering.
  2. Our old tools still work. Even though our roles have become more complex, most of the tools we have developed and used during the last decade are relevant today – strategic sourcing, category management, SRM etc. are all valued by the business and deliver outcomes. Everything old is new again, and most importantly, it still works.
  3. Digital is already disruptive. As customers, we are already online and procurement is about to explode into this space – drones, social media, 3D printing etc. are all transforming the way we think about everything from supply and demand; professional development; collaboration and sourcing.  The challenge is to ‘digitalise’ our ancient tools for this brave new world.
  4. We are a rare breed. Couple demand for our expertise with the rate the profession is growing, and you’ll see there are procurement opportunities exploding all over the world. Go and grab them!
  5. Our image is golden. As more talented people enter the profession and we are called on to tackle issues of core business importance, our image as a profession has grown stronger than ever. Gone are those outdated aspersions that find procurement stuck in the “dark ages”. That’s where Procurious comes in – Procurious is reimagining the image of the modern procurement professional – with the core of its members proving themselves to be a smart, upwardly mobile, and commercially savvy breed. 

“Study the past if you would define the future.”
― Confucius

History of Procurement

Procurement is one of the fastest growing professions in the world. For those of you new to procurement, here’s a “short history of the world” which may give some perspective on whether we are indeed in the “golden age”.

The Dark Ages

OK, so we all know our forefathers started in the backroom.  Clad in their brown cardigans, they executed contracts, processed purchase orders, accepting the odd bottle of scotch from suppliers at Christmas time.

Enlightenment

The forefather of modern procurement is widely accepted to be Gene Richter, who worked at IBM in the 1990’s.

The major US companies soon followed IBM by leveraging their global volumes and introducing standardized procurement processes. Not so long ago, the seven step sourcing process was being implemented, centralized procurement teams were formed, followed by supplier relationship management, and more recently category management.

The dot-com boom

The dawn of the new millennium was a time of rapid organization and maturation for the profession.

Many large companies made significant investments (such as $1M+ board approvals) to invest in cross-company procurement exchanges.

Now referred to as Procurement’s dot-com boom, these group-buy investments got procurement quickly on and then just as quickly off the Board agenda. Investments in group buying (and the associated technology) all “became a bit too hard”.

Despite these high profile, public failures, procurement continued to flourish and today, the “dot.com boom” represents the time we moved from the back room – in our brown cardigans – to the boardroom, where our Chief Procurement Officer’s increasingly find themselves either sitting, or at least contributing, today.

Globalisation and the extension of the supply chain

Once all the large companies had leveraged their spend globally, the hunt was on for the most cost-effective country to manufacture goods.

All of a sudden we were managing suppliers and their suppliers in foreign and often remote, locations. This is where the profession became, and continues to be very exciting…

Globalisation has brought with it significant advances, and made our profession  much richer as a result.

Today, its universally accepted that procurement has moved beyond just cost – we now play an integral role in areas of risk management – including supply, quality, innovation and mergers & acquisitions (M&A); new product development; and corporate social responsibility.

The Digital Age

As if our jobs weren’t “interesting” (aka challenging) enough, now we have to account for social media too… Not only are we expected to manage a worldwide network of suppliers and contractors – we are exposed to dangers like customers or shareholders posting a “Tweet” or “status” about how we are managing the supplier.

Yet, this is why working in procurement today is so incredibly interesting and why the profession continues to flourish. We’re working at the interface between the business and all its stakeholders – be that the community, customer, shareholder, supplier, and employee. We need to manage all these stakeholders with the highest integrity in order to protect our brand.

How to make the most of the golden age

If Sam Walsh is right, and we are in the ‘golden age’, how do we take advantage / don’t let this golden opportunity pass us by:

  1. Market yourself and your ideas!  You are your own brand, and nobody knows YOU better. Leverage your good name and use your influence to promote the profession.
  2. Stay connected. With the world and with your peers. Identify risks and opportunities, learn from others.
  3. Keep learning. Every minute of every day we are learning. Whether that be learning from our peers, our customers, and suppliers. And by doing this we are able to identify issues for procurement as they emerge.
  4. Enjoy!  Make the most of being in this profession at this prosperous point in history.  There are so many career opportunities right now – you should be grasping every opportunity to learn and grow.

Conclusion

Although an unlikely comparison for our profession, I use Madonna as an inspirational metaphor/analogy for managing your career.  Even though she’s been in the same role for more than 30 years, she keeps “reinventing” herself for her target audience.  She’s still a pop singer, but she is constantly changing her branding to ensure she stays relevant. As professionals we need to be doing the same!

And that’s what I believe Procurious can bring to the profession – a place to stay current, and stay connected. A place where all procurement professionals can get ahead and thrive in this golden age and beyond!

The term Golden Age (Greek: Χρυσόν Γένος Chryson Genos) comes from Greek mythology and legend and refers to the first in a sequence of four or five (or more) Ages of Man, in which the Golden Age is first, followed in sequence, by the Silver, Bronze, Heroic, and then the present (Iron), which is a period of decline. By extension “Golden Age” denotes a period of primordial peace, harmony, stability, and prosperity

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Spend Matters hits the nail on the head

When it comes to procurement, Peter Smith is a man who knows what he’s talking about.

The Managing Director and Editor of Spend Matters UK/Europe is among the profession’s top influencers so I was particularly delighted to read his review of Procurious.

The assessment was balanced and overall, very positive: “Procurious is a well put together, professional and attractive site, with some people behind it who clearly know the procurement world pretty well”.

In questioning whether the niche environment of Procurious will offer members value beyond that of broader networking platforms such as LinkedIn, Peter hits the nail on the head.

While social networks such as LinkedIn or Twitter offer scale and reach, they tend to be noisy, overcrowded and the content often lacks relevance for procurement. If you were looking for genuine career guidance, LinkedIn can rarely offer the in-depth answers needed.

As Procurious continues to evolve (We are currently in a soft launch phase – the full site will be launched in September 2014), we believe the key differentiator from other broad networking platforms will be the ability to connect and learn directly from people operating in the same industry or managing the same categories.

The quality and level of Q&A activity in the ‘Discussions’ section of Procurious, as compared with many of the stagnant discussion groups on LinkedIn, seems to confirm our belief that people feel more inclined to seek advice and share in a highly specialized and credible environment.

While Procurious is by no means the first niche vertical network out there – Oil Pro, set up to cater to professionals in the Oil and Gas sector, has attracted over 50,000 users in just 7 months – it offers procurement the opportunity to take a real leadership position within the business: Demonstrating how social media can redefine the way modern professionals work, connect and collaborate.

Just this week, TechCrunch featured an article on the rise of social professional networks – read it here.  I’m extremely proud that Procurement, via Procurious, is at the leading edge of this trend.

Procurious just might be a game-changer for Procurement because despite the undisputed progress made internally, frustrating and dated misconceptions persist externally. It doesn’t help that as a community, procurement professionals are still largely disconnected.

By coming together on Procurious, we can support the next generation of procurement leaders and empower them to change the face of the profession from the inside out.

In little more than a month, we’ve registered 1000 members from 48 countries. So the signs are looking good but we’re not about to stop here. To achieve our goal of becoming the global hub for procurement, we need your support.

If you haven’t already done so, we’re asking you to logon or refer a colleague to www.procurious.com – there is no cost to become a member or access any of the online training. We’re hungry for your feedback as to the direction Procurious should take and what value we can provide to you as members.

By coming together and supporting your fellow peers, we will demonstrate the strength and reach of this incredible global community.

Tania