Tag Archives: big ideas

6 Critical Skills You Need If You Want To Succeed In A Digital World

How should procurement professionals adapt in order to survive in a digital world? The digitally enabled workforce needs to nail six key skills…

This is a unique time for procurement organisations.

Never before have companies been able to derive more competitive advantage from superior procurement capability. The function’s role is shifting from a sourcing gatekeeper to a provider of insight and decision support, made possible by improved access to digital technologies, data and advanced analytics.

Investments in automation have helped make these organisations more efficient, allowing them to redirect headcount from compliance and operations-focused processes to higher-value activities such as sourcing and supply base strategy.

But this is only the part of the story.

World-class groups achieve their superior performance because they have higher-caliber people who apply their skills to effectively harness digital technologies and capabilities.

The Digitally Enabled Workforce Requires Six Key Skills

Effective procurement teams focus on people development from multiple points of view. Softer skills like relationship management and business acumen are important for managing customer relationships, while technical skills are necessary for analysing data and developing strategic insights.

The following skills are fundamental to the operations of procurement organisations in the digital era.

1. Business acumen

As economic volatility increases, category managers need to sit side by side with their stakeholders to make business decisions that impact the supply base.

It is crucial to understand complex business needs and be able to identify ways for procurement to address them using new technologies. Business acumen is fundamental to elevating procurement’s role as a trusted advisor.

2. Relationship management

Evolving the value of procurement requires working cross-functionally with a variety of stakeholders, from senior budget owners to line managers, as well as being a customer of choice and partnering with valuable suppliers. Procurement should have multiple communication channels open with business partners and customers to fully understand their needs.

3. Supply risk management expertise

In a market of increased risk and volatility, risk management capabilities are more valuable to the enterprise. For procurement, this no longer means simply reacting to events – now the focus is on predicting and avoiding risk using internal and external tools.

4. Strategic mindset

Understanding the broader market and aligning procurement’s vision with that of the business is fundamental to navigating change and extracting value from the supply base.

5. Data analysis and reporting

Big data will change the way procurement organisations use information. Those able to sort through the data and draw the right conclusions have the potential to add value to the organiSation. The tools are available today, but it will take years for widespread adoption, making analytics a prime vehicle for competitive advantage for early adopters.

6. Savings and financial analysis

Tying savings and value benefits to financial statements documents the business value contributed by the procurement organisation and drives profitability. Identifying direct procurement impact on the budget can be elusive but critical.

Digital Technologies Are Changing the Way Organisations Hire and Retain Talent

Access to new technology makes it possible to hire more effectively. By analysing demographics, job experience, recruiting data (like quality of resume) and environmental data, organisations can increase the effectiveness of new hires.

Even the culture of procurement groups is changing now that hiring standards have risen. Social media has provided new channels for knowledge and learning. Learning on demand is a common service delivered to employees, allowing access to training modules or experts from their preferred devices.

Joining networks of colleagues and outside communities to tap into knowledge and solutions to problems is common with tools like LinkedIn.

Strategic Implications

It is getting harder to find and retain people with transformation change experience and the ability to think strategically.

Unfortunately, procurement’s hiring practices, training and skills have not kept pace.

To compete, they must not let themselves be limited by organisational or geographical borders. By hiring globally, procurement deepens the potential talent pool and opens the door to new ways of thinking.

Next-generation procurement organisations are “borderless,” allowing for the free flow of ideas and talent regardless of geography. Leadership is distributed based on supply and customer priorities, not headquarter location.

The model that procurement must work toward is one that is capable of expanding, contracting and adapting rapidly as situations change, just like modern-day supply chains.

This article was written by The Hackett Group’s Laura Gibbons Research Director, Procurement Executive Advisory Program and Amy Fong Associate Principal, Procurement Advisory Program, and Program Leader, Purchase-toPay Advisory Program. 

The Hackett Group’s Chris Sawchuk will be speaking at Big Ideas Summit in London later this month. To find out more information and register to attend in person or as a digital delegate visit our dedicated site. 

Flashback Friday – Can You Make Procurement Decisions Under Fire?

Are you struggling to lead or motivate your team through difficult times and under extreme pressure? We’ve got some top advice from someone who knows a thing or two about making decisions in extreme conditions…

Andy Stumpf spoke at the Chicago Big Ideas Summit 2017. Read more about our upcoming event  – The London Big Ideas Summit – on 26th April 2018 and find out how you can get involved. 

“There are only two types of leadership.” begins Andy Stumpf “good (effective) and bad (ineffective).”

In today’s world, senior managers often struggle to effectively  respond and adapt to change. But the world is full of change and it’s crucial that our procurement leaders are flexible enoughto respond to the unexpected, to “read the tea leaves and meet the challenges of the real world.”

Andy  began his U.S. military career at the age of 17, transitioning from the position of an enlisted soldier, to an officer, and then,  in 2002,  he joined the most elite counter terrorism unit in the military; SEAL Team Six.

The unit, which is tasked with conducting the nation’s most critical missions, has become the inspiration for a number of Hollywood movies and books.

If you ever needed a man who knows how to plan for and adapt to change, Andy Stumpf is your guy! He’s strategised and executed hundreds of combat operations throughout the world in support of the Global War on Terror.

At Procurious’ Chicago Big Ideas Summit, Andy will draw on his wealth of leadership experience to talk about the intersections between business and combat, decision-making and empowering procurement teams.

Building the greatest leaders

“Business and combat are defined by their similarities, not differences and the theories of successful military leadership and successful business leadership are identical” Andy believes. It’s possible to apply the same principles and philosophy to your procurement teams because it’s really only the arena that differs.

“60 per cent of the time, organisations want me to talk about leadership. In fact, the definition is always the same. What can change is the way in which you approach leadership.”

So, how do the military build strong and competent leaders?

“Leadership is about empowering your people. From day one in the military we are taught, and it is enforced, that in the absence of leadership you must stand up and take control.

“Instead of creating individuals that think reactively in nature, we instead create individuals that think proactively.  You don’t have to be in a leadership position now to think two or three steps ahead.  In doing so, when a decision presents itself you’ll already have an answer for it.”

Does Andy believe these skills can be taught or are natural leaders exactly that?

“neither successful teams or leaders occur by accident, these are skills that must be learned, practiced, and refined. Navy SEALs are successful because of how we select, train, and lead our teams.

“Nothing in that process happens accidentally, everything is calculated. We demand leadership and accountability from each individual starting from the first day of training. We prioritise the individuals to our left and right, and the goal of our team over personal success. This philosophy is diametrically opposed to what is often found in society, and requires a structured approach and prioritisation from leaders to be successful.”

And Andy has some strong words of advice for any over-confident leaders out there. “The 1st leadership principle within the SEAL Team is ego; if you have a massive ego you’re more concerned that your ideas and strategy is being used as opposed to striving for success of the team. You can’t meet the challenges of the real world this way!”

Plan, plan and plan some more!

“We plan for everthing in the navy. We often say that if you want to shut down the military, you simply need to shut down powerpoint!

“Every stage of a plan gets one slide and there might be between five and seven slides on the ‘what-ifs’, the contingencies. Where will we land this helicopter? Where is the nearest location for medical treatment and what alternate options do we have?” When, as Andy points out, precisely 0 per cent of planning goes as expected, contingencies are everything!

“You make primary, secondary and tertiary plans because you don’t want to have make snap decisions in a crisis. You need to be able to fall back on stable procedures”

And of course, it can’t hurt that contingency planning makes you look like something of a genius! “It’s really hard to make difficult decisions in a crisis because you’re in a time compressed environment and you may have people’s lives depending on you.  We plan for 24 -72 hours and there are 5 phases per plan. Each phase has 5-7 ‘what if‘ contingency plans because, at the end of the day, you don’t want to make decisions in a crisis, you want to be able to draw on a branch diagram.

“It’s the contingency planning especially in the SEAL teams that makes the difference between success and failure in moments of crisis.”

What can our procurement teams learn from this? Spend a lot more time planning, for starters! But Andy also reinforces the value in having baseline standards to fall back upon. “Businesses should always fall back on standard procedures so people can come together, with a clear knowledge of the protocol. This is especially crucial when you’re working under restrictive time constraints.”

Andy’s final words of advice? “Don’t get attached to your plan -get attached to success!”

Andy Stumpf spoke at the Chicago Big Ideas Summit 2017. Read more about our upcoming event  – The London Big Ideas Summit – on 26th April 2018 and find out how you can get involved.