If you’re determined to reach for the procurement stars, Procurious’ new eBook might just give you the boost you need to get there. Download 15 Ways to Become a Procurement Superstar for FREE here – it will get you well on your way to procurement stardom.
With training budgets slashed and a terrifying to-do list, getting the training you need in order to get promoted can be tough going.
We’re going to level with you here: If you’ve got your sights set on getting ahead in your career any time soon, you can’t avoid the brave new world of eLearning.
Our brand new eBOOK, 15 Surefire Ways to Become a Procurement Superstar, is FREE to download from the comfort of your own home and is jam-packed full of invaluable career advice for you to soak up on the go..
What’s It All About?
Last year a staggering 6500 procurement pros took career success into their own hands by joining Career Boot Camp.
Procurious launched this exclusive 15-day programme to help high-achieving professionals around the world get in the best career shape of their lives, and upgrade their skills while on the go.
Each five-minute podcast was delivered by a different industry thought leader, drawing on a wealth of experience and offering insightful, applicable career advice. That’s 15 days, 15 thought leaders and 15 procurement podcasts covering everything from networking your way to the top, to nailing social media and becoming a global player.
The great news for you is that we’ve now compiled the entire programme into one, stunning, and FREE, eBook complete with blog articles, podcasts and the most important take-away learnings to help you become a Procurement superstar in next to no time!
How will I achieve procurement stardom?
Unleash your “procurement mojo”, take your conscience to work, network your way to the top, incubate your big idea on the job, build your personal scorecard, and become a global player. Whatever the gap in your skill set, our eBook’s got it covered.
Some of our featured thought leaders include:
Jon Hansen – A Global Broadcaster with an audience of 15,000 weekly listeners
Tom Verghese – A Cultural Intelligence Advisor to Forbes 500 companies
Chris Sawchuk – Global Procurement Practice Advisor, The Hackett Group
Tom Derry – The CEO of the profession’s peak body, ISM
Still not convinced? Here’s a little preview of what you can expect. Tom Derry, CEO ISM, gives five surefire ways to become a CPO.
“Outcomes matter in business. We need to be able to establish a track record, consistently follow through, and be relied upon to deliver.”
If you’ve not yet had the chance to join our 21,000+ strong Procurious community, now’s the perfect time! You’ll gain access to our daily news, discussions, eLearning, webinars and much more!
Karen Morley realised very early on in her career that her workplace experience would be somewhat different from her male counterparts. Drawing on her wealth of knowledge she offers three key pieces of advice to procurement rising stars.
Quite early in my career, it became clear that my overarching purpose was to help leaders realise their full potential (although I may not have articulated it quite as clearly as this at the time!). I have a huge and on-going curiosity about people and their motivations. I became a psychologist to explore that further, and my studies and professional identification fed my purpose.
Levelling The Playing Field
As a young woman starting out my professional life, and with an ambition to succeed and achieve well, I was a keen observer of who in my organisation was given the best opportunities and who was promoted, and it didn’t take long for me to conclude that there wasn’t a level playing field for equally talented men and women. This was a big surprise to me and it was disappointing to know that equality efforts still had a long way to go.
And so my purpose has developed over time to include my passion for ensuring women are provided equal opportunity to grow and succeed, and for working with organisations to promote strategies that increase gender balance, and diversity and inclusion in general. To any procurement rising stars, I offer three key pieces of advice:
Rising Stars: What got you here won’t get you there
This phrase, which comes from Marshall Goldsmith, is a very powerful one. Continuing to do more of what you’re good at is seductive, but limiting, at least if you want to keep rising. And not all organisations are good at making this clear to their newer leaders.
While we know that new roles and increased seniority require new skills and perspectives, I also speak with the leaders I coach about what they need to give up. You need to give up a lot of what you have been recognised for and been good at, once you’re managing a team.
Create strong foundations that will serve your entire career
Notwithstanding that you need take on and give up certain skills and perspectives as your career grows, there are a couple of related foundation skills for leaders that help regardless of the size and shape of your job. I think these are some of the toughest things to manage, but worth it in terms of the payback:
Manage your attention – disciplined attention is the currency of leadership. To be successful you need to pay attention to the things that matter most, and sustain your attention on those things in the midst of many distractions.
At increasingly senior levels this intensifies and focusing strategically and productively becomes ever more challenging. How to zone out the minutiae of everyday demands and keep attention on the big picture? You’ve got to be a bit ruthless with your attention and give up any need you might have to be all things to all people, or to be the one who has the right answers. Instead, prioritise what matters most and excel at it.
Manage your perspective – being able to manage your attention helps you to manage your perspective taking. And managing your perspective taking helps with important things like enabling others to do their work, and managing complexity.
The only effective way of dealing with complexity is being able to take different perspectives. Instead of managing for certainty, we need to lead for possibility. That can be challenging, and anxiety-provoking, in organisations where the drive is towards certainty. Seeking out the perspectives of people who are different from us, irritate us, or who stretch us beyond our comfort zones, can unlock enormous creativity and power. What questions do/would they ask? Build them into your repertoire to develop greater flexibility in your thinking.
Know your story, and tell it well
How do you want the world to know you, and to understand the leader you are becoming? Spending time crafting your storylines is of critical importance firstly in gaining your own clarity: what’s your leadership purpose, your values and motivations to lead? How readily and clearly can you articulate these?
When you’re growing and developing, your stories may become a little confused, and some of them are changing. You may need to discard some, and find new ones. Working out how to articulate them clearly can help you gain clarity on what they are. Win:win!
I find that women in particular may be reluctant to tell their stories; I often hear ‘I don’t think I have anything interesting to say’. But everyone does. And a story should only take 60 to 90 seconds to tell.
No-one else will be clear about what you stand for if you’re not. Your stories serve to prime you for success. As you tell your stories people come to better connect with you, understand the authentic you, and appreciate your intentions. Help them to see you as the leader you want to be known as.
My Top Tips On Reducing Gender Disparity
To be successful in shifting the representation of women in senior roles and start to nurture those rising stars, it’s important to nail these four things:,
Sincerely champion the value of women in senior leadership, and publicly commit to change; Giam Swiegers, Global CEO of Aurecon, is a wonderful example of this
Develop an inclusive culture and supporting practices, including promoting inclusion as an organisational ideal, promoting inclusive practices such as flexible working for everyone, and changing hiring and promotional practices to make them merit-based
Collect the right data, make it transparent and hold managers to account; Marc Benioff, CEO of Salesforce and Lara Poloni, CEO AECOM A&NZ are outstanding examples of organisations that transparently reviewed pay data, found gender-based differences, and adjusted the salaries of affected women
As a leader, recognise the impact and pervasiveness of unconscious bias, seek to understand it, and improve decision making practices to reduce its impact
Procurious has launched Bravo!, a group that seeks to celebrate and promote women working within procurement. Get involved here.
Increasingly, companies are appointing CPOs from outside of the supply management profession. What does this tell us about C-level expectations of procurement, and why are supply management professionals missing out?
This is the moment you’ve been waiting for. Years of hard work and a brilliant career in supply management has brought you to within a hair’s breadth of fulfilling your dream – to become the Chief Procurement Officer of your company. Starting at the most junior level, you’ve worked your way up the ladder to your present position as second-in-charge of the procurement function. Your boss announced his retirement last week, and you’re quietly confident your turn has come – after all, there’s absolutely nothing about the organisation’s supply chain that you don’t know.
You step into the meeting room where the out-going CPO and two other executives are seated around a table. Disconcertingly, they stop talking when you walk in and look at you guiltily. Getting straight to the point, they tell you they’re excited to announce the new Chief Procurement Officer is … Jennifer from Marketing.
Is Procurement Being Usurped?
Has this happened in your organisation? There’s every chance that when it comes time to choose a new CPO, the C-Suite will appoint someone from a non-supply background. This means that a colleague of yours in a completely different department may one day swoop in to steal the job that you’ve been working towards for years.
While CEO-level expectations of the CPO continue to blur and broaden, the skill-set required to meet those expectations can now potentially be found in any department. The fact that supply managers are still reporting difficulty in educating their businesses on the value procurement can bring to an organisation doesn’t help the situation. If a CEO (wrongly) believes that a supply manager has spent his or her career focused solely on cost, then they are likely to look elsewhere for candidates for the top job.
Deb Stanton, Executive Director of Research and Benchmarking organisation CAPS Research and former Global CPO of MasterCard, has observed the trend of CPO appointments from outside of the profession. CEOs are no longer as interested in appointing CPOs who possess the traditional skill set that is earnt over years working in supply chain. A savvy marketing professional, or a cost-conscious operations manager who understands how supply management works, makes a very attractive candidate for CPO.
So, what does this mean?
CEOs are looking for a different set of skills for the next CPO
The CPO of the future may have little idea how a tender is run, but they must:
Be business-savvy and understand the organisation as a whole
Know how procurement works from a customer’s perspective
Be completely aligned to overall business strategy (not just the supply management strategy)
Have a strong knowledge of the business’ finance function
Be focused on the core customer and external audiences
Embrace changing technology and external disruptive forces
Be an influencer and relationship management expert.
Deb referred to CAPS Research’s “Futures Study 2020”, which projects the skills required to manage a procurement function into the future.
The CPO doesn’t necessarily need supply management expertise
The complex and varied skill-set picked up through a career in supply management may no longer be enough to satisfy the requirements for the job of CPO. CEOs may even regard procurement’s traditional audience of stakeholders, end-users and suppliers to be too focused.
That being said, technical procurement skills do matter, and are still vital for any procurement team’s success. In the example above, the disappointed candidate who missed out on the top job can still play a vital role in educating and supporting the outsider CPO with their supply management knowledge.
What’s the solution? If you believe the CPO role rightfully belongs to you, rather than someone from a completely different department, then make sure you broaden (rather than narrow) your focus as you move upwards in your organisation. This means familiarising yourself on a macro level with the whole business, bringing the core customer into every decision you make, and being known as an influencer who can clearly articulate the value you, and your function, brings to the business.
As Deb pointed out today, procurement professionals are in a unique position to overlook an entire business. They’ve got every chance of seeing where the opportunities are so let’s use it an not lose it!
Imagine if you could go back in time to when you started your first job. Wouldn’t you love to reassure yourself it was all going to be ok or offer some advice on how to navigate the next few years of your career?
Procurious recently launched Bravo, a new group seeking to address gender disparity in the workplace, and celebrate and empower women working within procurement.
As part of the Bravo campaign, Procurious will be interviewing a number of high profile procurement leaders and seeking their advice on how we can help other women to get ahead in their procurement careers.
Michelle Baker is Global Procurement Director: IT and Business Services Categories at SABMiller Procurement.
In this interview Michelle discusses the issues that affect women in the workplace, advice she would offer her younger self and why she loves procurement!
Michelle will also be attending this year’s Big Ideas Summit as a panelist to talk about Global Risk assessments.
What have been the most successful approaches organisations you know have taken to decrease gender disparity?
Putting gender disparity on the leadership agenda of issues to address.
Balanced slates in recruitment.
Making gender disparity a talking topic across the whole company, irrespective of people’s gender.
What has been your most rewarding experience and greatest accomplishment to date?
Leading and developing people in diverse global teams (and not just gender diverse, but race, religion, age, sexual orientation etc.) has been fantastically rewarding personally.
My greatest accomplishment in the workplace is that I am still curious and excited about the work I do after so many years: IT’s evolution has meant I have to constantly hurry to keep up!
What issues currently affect you as a woman in procurement?
I don’t think diversity is an issue exclusively to procurement.
But, looking back, I think the absence of positive role models in senior roles made it more difficult to navigate corporate politics than it needed to be.
Who are the most influential women in your life?
Too many to mention! I have a healthy group of friends and family that go back to my early days at university in South Africa and many others scattered across the countries in which I’ve lived. They each offer their own special support, whether they know it or not, in my development.
Why is procurement the perfect career for you?
It keeps me endlessly curious and allows me to have direct contact with what a range of senior stakeholders in my company are doing and trying to achieve.
If you could offer your younger self two pieces of advice, what would they be?
Find a mentor, and never stop learning.
Some of the Procurious team joined Michelle at a Women in Procurement Breakfast last year at ProcureCon IT.
Following an insightful discussion, everyone said the two pieces of advice that they would offer their younger selves.
Michelle put together this fantastic infographic to represent the group’s responses.
Let us know the two pieces of advice you’d like to offer your younger self via the Bravo group.
Tired of being passed up for promotion? Want to further your career? Maybe it’s time for you to go back to school and continue your education.
So you spent your four years in university, got that business diploma, and got a job. Now what? Of course you can stay at the job you have and continue to improve your skills in the world of business. But as every aspect of business is constantly changing, many people with a bachelor’s degree may find themselves passed over for promotions because the ideal candidate has more education.
The simple fact is that the true path to success in any field is continuing education. Nowhere is this more true than in the business sector. Whether you’re working in finance or some other sector of the business realm, the importance of an MBA can’t be overlooked.
The good news is that getting that MBA is easier today than it’s ever been thanks to online courses from reputable universities with educators who know business administration inside and out. If you’d like to learn more about how working toward that MBA can improve your professional life read on to see just how impactful that degree can be.
The most impactful reason to pursue an MBA is the simple fact that you’ll be more desirable to employers, and you can ask for and get an increase in salary. Depending on your chosen field, this can be in the range of 25-50 per cent more than you’re currently making.
Following the initial increase in salary, you can also expect to earn more over your lifetime with an MBA than if you stopped after earning a bachelor’s degree. It just makes good financial sense, especially if you plan to start a family.
More Opportunities Abroad
The business world isn’t limited to the United States. Business and financial hubs around the world like Hong Kong, Dubai, London, and Taipei are filled with companies eager to hire intelligent, dedicated employees. But there is a caveat. Most of these international companies all but require a master’s degree to even get a foot in the door.
Working abroad not benefits you culturally, it adds an impressive column to your CV. Additionally, in some countries, taking a job there can mean significant tax breaks. It’s for this reason that many people with advanced degrees now choose to work and live abroad.
You’re Not Limited to the Business Sector
Another great aspect of an MBA is that you’re not limited one particular industry. Finance, health care, education, and government are all eager to hire people with advanced degrees for a number of positions.
One of the key factors of the degree itself is that you’ll have the chance to choose sub-specialities. These areas of focus can put you in a better position to move toward other job opportunities. For many graduates this means they’ll be in a position to branch out and explore more varied job opportunities.
Increased Networking Opportunities
Many people say that, in the business world, it’s all about who you know and, in many ways, it’s true. An undergraduate degree in business and the process behind it doesn’t give you access to true business experts in the way that an MBA programme does. The connections that you’ll make during your MBA courses could prove to be very valuable.
Many educators who teach MBA courses do so in addition to regular jobs in the business world. If you’re a standout student and make the effort to meet and talk with your professors and their colleagues, you can find yourself in a great position when it comes time to ask for references and update your CV.
Taking the time to further one’s career through continuing education can seem like a daunting and time consuming task. However, many people who have taken the MBA plunge have found the hard work pays off in a big way.
There are so many types of MBA programme available, so do some research, decide which one is right for you, and start cracking books again. The rewards can be better than you expect.
Tiffany Rowe is a marketing administrator who assists in contributing resourceful content throughout the World Wide Web. Tiffany prides herself in her strong ability to provide high quality content that readers will find valuable.
The recruitment process can be brutal. You’ve work hard to identify and attract the best procurement talent. But, at the last minute, the candidate pulls out leaving you back at square one. Michael Page’s Graham Lucas has some top tips for achieving a successful recruitment process.
Register as an online delegate for the London Big Ideas Summit 2017 here.
Procurement has come a long way and holds a position of positive influence within many organisations. The agenda for the Big Ideas Summit – Procurement in the Digital Age, Rethinking What’s Possible, Building Workforce 4.0, and The View from the Top – shows that there has never been a more urgent need for bigger change and greater evolution.
You need only to look at the progress over the past few years to recognise this. SRM, improved supply chains, driving both value and innovation from suppliers, and category leads shaping strategic agendas are some of the developments we have seen.
Whilst the progress is positive, the evolving shape of organisations and the disruptive nature of technology is only going to increase both the degrees, and speed of change required. I genuinely don’t believe that procurement as a function will continue to exist unless it drives a much greater breadth to its commercial influence over an organisation.
So what affect does this have on talent attraction, acquisition and retention in procurement teams?
The Procurement Talent Pool
It is clear that 80 per cent of the roles on which we are being briefed carry very similar requirements. Organisations are competing for the 20 per cent of candidates in any potential pool that possess the key skills needed to help procurement teams deliver that broader value. Influencing skills, communication, being able to connect with stakeholders and suppliers, and driving innovation etc. Most procurement teams will have advertised a role recently specifying many of these requirements.
Identifying the talent you want to hire is only one aspect of the challenge. You’ll also need to ensure that you are able to acquire them. Three in every four of the offers that our clients are making are being met with counter offers, many of them substantial. In half of these cases the counter offer is equal to or greater than the offer made by our client.
Fortunately Michael Page are mitigating most of the risks associated with this for our clients. It’s important to prepare a candidate for what is to come when they resign. We also consider what they need from the process and screen out those that are not serious. This is all part of what a good recruiter will do. And after that, it’s down to you….
What can procurement teams do to avoid losing talent they have worked so hard to identify and attract? It comes down to six key factors.
Understand key motivators
Understanding candidates’ key motivators is crucial to ensuring that any chance of buy back is reduced, and to make the right hiring decisions for long-term performance and retention. If you have truly understood their motivators you are more likely to run a process that allows them to see how these can be met by you and your organisation. Where these don’t match you can save yourself critical time. This will allow you to focus on better prospects in terms of those that will actually join and, just as importantly, stay.
Get clarity on the full package
Package clarity: as with motivations, it is vital to get into the detail of a candidate’s current package at the beginning of the process so provide a full breakdown of the package and the value of it.
This will allow for an accurate comparison of a candidate’s current situation vs. the package on offer. Bonuses (likely earnings and also when they are paid), pensions, healthcare, car packages…. Not only do they mean different things in different businesses but many people don’t know the details until they are asked to look. Get in the detail early and manage expectations from day one. Otherwise you could be either under offering or underselling your own offer.
Offer a healthy balance
It’s easy to overlook the importance of a work life balance. There’s no point getting into the middle of a process only for a candidate to decide the commute is too tough or expensive. Likewise, what is the realistic work/life balance you can offer in the new role? What are the candidate’s personal circumstances? Will this impact their final decision? It is crucial to be upfront about this from the start.
Ensure that people want to join your people!
This has a huge impact on candidates but is, strangely, sometimes underestimated. Candidates will form an attraction to a business and a team. This is separate from things like role specification, package, location etc. If you can get your prospective employee to meet people that they believe they can work with, and most importantly learn from, it makes the organisation much more desirable.
People join people more than they join companies.
A competent recruitment process
Candidates often judge businesses by their processes particularly at interview stage. Make sure there are clear timelines in place to manage expectations. Does the advised preparation match with the content of the interviews?
Whilst these may seem like small things, they can make a big difference. A company that is well organised, thorough and effective at recruitment, can either impress or put a candidate off. Asking someone to deliver change in an organisation that doesn’t appear able to do what it says it will do sends out the wrong signals.
Make your offer compelling
An offer should always be made based on what the hiring business thinks the candidate is worth, not just on the advertised package. For each role it is worth considering what a compelling offer would be. Both as a statement of intent to secure the candidate and also to ensure your remuneration is in line with the rest of the market. Importantly, this might not just be salary; it could be a bonus, private healthcare package or flexible working hours.
Graham Lucas is Managing Director – Procurement & Supply Chain and Logistics at Michael Page. He’ll be speaking at the 2017 Big Ideas Summit next week. Join the conversation and register as a digital delegate here.
To achieve creative cultures within our organisations and inspire creativity in individuals, we need to Fund, Foster and Fill!
Register as an online delegate for the London Big Ideas Summit 2017 here.
James Bannerman, a creative change agent and author of Non-Fiction best-seller Genius! firmly believes that everyone has the capacity to be creative and innovative. He’ll be speaking at the Big Ideas Summit 2017 in London on 23rd February but we’ve picked his brains ahead of the event to find out his top tips for inspiring creativity and his plans for the future..
What is a creative change agent?
A creative change agent is essentially a ‘lateral thinking’ specialist. It’s someone who combines creativity with psychology to help businesses innovate and perform more effectively in a rapidly-changing world.
What’s one thing you know now, that you wish you’d known at the start of your career?
When I was younger I was a laid-back song-writer and did not fully appreciate how important it is, in business and life, to ‘make your own sunshine’. Over the years, however, and especially when I wrote my books Genius! and Business Genius! I came to realise that books don’t write themselves; they ended up taking me far longer to write than I ever imagined, and involved far more hard work than I ever envisaged. However, fortunately the hard work paid-off – because they ended-up becoming best-sellers in the UK and then being translated into multiple languages from Chinese to Japanese, and Italian to Thai – and that taught me that ideas alone are not what makes the difference; it’s turning those ideas into reality that makes the difference.
What are your three top tips for inspiring creativity in organisations?
My three top tips for inspiring creativity in organisations would be what I call The 3 Fs: Fund, Foster, Fill.
Fund (i.e. invest in) ‘Creative Thinking’ training
Upskill people by teaching them ‘how’ to be more creative. Evidence suggests, for example, that virtually all of us were incredibly creative up until the age of about 5, but then this natural creativity was ‘schooled’ out of us by the double whammy of criticism and conformity. Effective ‘Creativity Thinking’ training can help to redress this situation by inspiring people to re-become creative.
Foster an atmosphere of Psychological Safety
Einstein once said that ‘a person who never made a mistake never tried anything new.’ With this in mind, if an organisation genuinely wants to inspire creativity, it needs to provide employees with enough ‘wriggle room’ to make the occasional ‘excusable’ mistake – rather than ‘inexcusable’ mistake (which is a very different matter).
Fill the well
I’ve long believed that in order to inspire others we need to feel inspired ourselves. Psychologists refer to this as ‘mood contagion’. So, if an organisation wants to inspire creativity, it needs to keep ‘Filling the Well’ (as the author Sheila Davis describes it) by encouraging people to branch out and watch new films, read interesting books, travel to different places etc… After all, bang in the middle of the word ‘Innovation’ we find the word ‘Nova’ – which meant ‘new’ in Roman times – so a constant inpouring of fresh stimulus is likely to inspire a culture that goes beyond ‘what is’ to explore ‘what could be’.
You’ve composed hit pop songs, written best-selling books and work as an innovation consultant. What’s next?
I’m currently working on a wide range of projects – linked to ‘Lateral Thinking’ in business and academia. However, longer-term, I’d love to take my Business Genius and ‘Lateral Thinking’ work to whole new level, and develop Lateral Thinking TV, movies, and animations etc…
How do latest technology developments influence the way you consult with organisations and drive innovation?
To be honest, although technology developments have influenced the way I consult with organisations and drive innovation – eg. by making it far easier for me to communicate with clients around the world without always having to ‘be there’ in person – technology itself does not influence me as much as it helps other innovation consultants I know. I tend to focus more on ‘innovativeness’ than ‘innovation.’ In other words, I focus more on the people-side of innovation – the psychology side.
It’s easy to think that our modern age is infinitely more ‘innovative’ than any other with its amazing advances in technology. Without a doubt the ‘pace’ of change does keep getting faster and faster, which academics label ‘accelerated evolution.’ However, just look at the Edwardian Age. Within ten years along came the Car, the Plane, the Radio and the TV. Each one of them radically transformed the world we live in, far more than the latest XI78 or X189, that will soon end up somewhere in a design museum like the DVD or the first Blackberry.
I work with the ESA, European Space Agency, who are putting 3-D printers on Space Stations. In fact, there are even 3-D printers now that can make 3-D printers ! We must not lose sight, however, of how technology is driven by ‘people’, and inspired by ‘people’. The human factors that make innovation happen can also ‘stop’ innovation from happening if they are not addressed and resolved.
Do you ever get tired of thinking up ideas?
Yes and no. I personally get a buzz from ‘divergent thinking’ – i.e. thinking outwards towards multiple possibilities – more than ‘convergent thinking’ – i.e. analysing and dissecting data.
However, when I’m working with groups on Idea Generation, I fully appreciate that ‘thinking up ideas’ can be deceptively tiring for some people. Especially those who have a strong preference for sequence and structure.
Tony Buzan, the inventor of mind-maps, is a great inspiration of mine. I spoke with him a few years ago and was struck by how well he manages to fuse the two. Mind-maps, for example, can energise people by stimulating ‘radiant thinking’. They also make it easier for them to think up new ideas, yet at the same its ‘systematic’ approach can also give people a flexible structure to prevent them feeling overwhelmed and swamped by imaginative solutions.
It’s important to remember that everybody has an imagination. We continually ‘think up ideas’ whether we see ourselves as creative or not. In fact, one of the biggest buzzes I get in business is helping people to realise that they are a lot more creative than they give themselves credit for…
Procurement professionals need the ability to understand – and react to – changes in inflation, employment and optimism.
Register as an online delegate for the London Big Ideas Summit 2017 here.
The interesting thing about procurement’s typical line of sight is that it very closely aligns with the terms of the sourcing projects we run and the contracts – and therefore supplier relationships – we manage. This might be 6 months, 12 months, 3 years, or 5 years long, but regardless of the exact length of time, you can be assured it is far longer than the changes being seen in global and local economies.
Since the summer of 2016, I have been the Business Survey Chair for the ISM-New York Report on Business. It has been an amazing learning opportunity, and I am fortunate to be working with a career economist to learn to decipher and draw meaning from the data. There are two pieces to the report: 1. the indices (some seasonally adjusted and some not) which provide a monthly trend up or down as the economy contracts or expands, and 2. the narrative, which highlights some of the key figures and milestones and adds some context to the numbers.
You don’t have to be a professor to see the connections between procurement and economics, but it is easy for us to become overly focused on information that is internally available or provided by suppliers. Based on what I’ve learned, the following categories of information tie directly to procurement’s efforts and objectives. And although they may not often come up in internal conversations, they need to be present in procurement’s thinking and strategy development.
Investopedia defines inflation as “the rate at which the general level of prices for goods and services is rising and, consequently, the purchasing power of currency is falling.” Most of what procurement buys tends to be based on pre-negotiated contracts, so we’re unlikely to see annual changes in prices based on inflation. What we might see, however, is a difference in the prices we are able to negotiate every three years. This will be especially true of anything we buy internationally or that has significant foreign-sourced materials in it because the relative purchasing power of the U.S. Dollar in global markets will be affected by inflation. But it’s not just an international issue – for any procurement team that reports into finance, keeping an eye on inflation will give you a benchmark for the minimum project-level ROI, as the alternative might be to just hold onto the cash if the project is expected to return less than 3% (the average rate of inflation) per year.
Higher levels of employment are usually considered a good indicator or economic growth and stability. From a procurement perspective, however, employment also tells us what to expect about trends in services-category spend. With an increasing portion of organizational demand being met ‘as-a-Service’, employment rates (and therefore costs) are critical to our cost to operate. For some industries, services are so important that even the factors driving alternate economic measures like ‘Prices Paid’ are services too – the New York Metro area is a perfect example of this, as are many other major cities. It’s why you must know the product/service mix in your spend before trying to figure out what approach to take. The other consideration relative to employment is talent availability. Higher employment means lower UNemployment (see how I did that?) and therefore less candidates available to compete for open positions. Luckily for procurement, we have a wide array of talent options at our disposal through contingent workforce programs. Striking an optimal mix of employment models presents an opportunity to maximize both costs and capabilities.
The final economic index I’ve learned to appreciate is optimism – in the ISM-New York Report on Business we call this the Six-Month Outlook. In other words, as of today, how much better or worse do you expect things to be going six months from now. It would be unrealistic to expect the outlook to be more specific than a trend up or down, but even this insight provides important information for others watching the economy. The fact that this question is even asked is an indication of how special procurement’s perspective on the economy and business activity is. This perspective is due in part to our understanding of the organization’s anticipated demand levels and the prices we are paying, but also the conversations we have with suppliers about the conditions they are doing business in. Competition drives prices down, differentiation drives margins up, increases in demand drive prices up, and large increases in price may push buyers and suppliers to innovate together to come up with alternatives, and procurement has a front row seat for it all.
Many people in the business world watch the monthly reports on business, whether the ISM national reports or regional reports, like ISM-New York. If they value procurement’s perspective on the economy enough to wait for the numbers to be released each month and report on the findings, then we should have a greater appreciate for our own insight and do everything we can to deepen it.
2017 could be a pivotal year for the procurement profession. The Big Ideas Summit in London will help lay the ground work for all of the changes ahead. Our London event takes place on 23rd February and you can now register as a digital delegate now!
Massive changes are coming to procurement pros, whether they like it or not! Is it high time we started embracing, instead of resisting, them?
Mark Stevenson is one man who understands the key trends heading our way. An expert on global trends and innovation, he will be setting the scene with our opening keynote at the Big Ideas Summit 2017 in London. We caught up with Mark ahead of the event to get to know him a little better!
Tell us a bit about yourself?
I’m an entrepreneur, an author, an occasional comedy writer, a musician, and, as some people like to define me, a futurologist, but I’m not at all keen on that particular term.
What don’t you like about the term Futurologist?
I think it’s a fairly dodgy profession overall if I’m honest. There are no qualifications required and it’s often associated with prediction and, of course, you can’t really predict the future, you can only make it. Also people who identify themselves as future-experts are as apt to be shaped by the culture in which they are embedded or dogged by their own prejudices and wish-lists as the rest of us, and tend to predict accordingly. For instance many futurologists are overly tech focused. My work is more about the questions the future asks us about the interplay of technology, economics, society and politics. My job is to help people and organisations to ask the right questions about the future and then convince them to answer those questions in a way that makes the world more sustainable, humane, compassionate and just.
What are the key challenges procurement and supply chains face in the next decade?
Supply chain issues are hugely important at the moment and supply chain professionals are having a lot of questions asked of them.
The first challenge to overcome is achieving greater supply chain transparency. Plenty of procurement professionals, particularly in larger organisations, have no clue where they are actually buying from. When the Rana Plaza building in Bangladesh collapsed in 2013 killing over 1,000 factory workers, many high-street brands were called out and, it materialised, ignorant of their involvement. Tragedies like this have forced high street companies to better audit their supply chains but there’s still a long way to go.
Secondly, organisations need to make their supply chains more sustainable by adopting science-based targets – addressing agricultural sustainability and reducing carbon emissions to give a couple of examples.
You’ve often advocated science-based targets in the past. Could you explain the concept in more detail? How could procurement apply these targets?
Science-based targets are a really simple idea and a very good way to think about sustainability. When it comes to dealing with environmental sustainability companies tend to say ‘this is what we can do, this is what we’re aiming for’ but, in reality, it doesn’t mean a whole lot when a multinational organisation vows to reduce its carbon emissions by 10% by the year 2034! That’s a recipe for planetary disaster.
Instead, organisations must figure out what they have to do based on scientific facts. The Science Based Targets campaign (a partnership between
Carbon Disclosuse Project, UN Global Compact, World Resources Institute and WWF) helps companies determine how much they must cut emissions to prevent the worst impacts of climate change. Coca- Cola, Walmart and HP signed up to this and if they can do it, anyone can.
And, by saving the world you’re also saving your business. Companies who take this stuff seriously will out-perform because they’ll become more efficient and they’ll attract the most forward-thinking, young talent who want to work for companies of which they are unashamed.
In your experience, how open are organisations to new technology trends?
Not very! Organisations tend to be comfortable operating as they always have done.
Upton Sinclair put it well: ‘It is difficult to get a man to understand something when his salary depends on his not understanding it.’ Take Blockchain, it could take away the untrustworthy parts of banking: bankers, who will naturally resist this particular technology!
Another example is driverless tech- it doesn’t take an expert to predict that the 3.5 million US truck drivers would be wary of such an advancement – and rightly so. So we have to find a transition plan for them – which culture resists. But it’s a business responsibility to prepare for the changes and approaching transitions, you have a duty of care to your employees and not being future-literate is a dereliction of that duty. Remember, Blockbuster, the DVD rental company went bust the same week that Netflix released House of Cards.
If you had one key message for our delegates at Big Ideas, what would it be?
Wherever you work and wherever you end up in the next 15-20 years, remember that it’s going to be a very turbulent time. Massive disruption lies ahead and the bad news is that our current institutions and businesses are unfit for purpose. Ask yourself: what’s my best effort for myself, my family and for society (and remember they’re all related). If you don’t, you can prepare to be very irrelevant and very unhappy!
It’s that time of year again. January has come and gone and you’ve realised that, despite the best of intentions, you’re not actually going to deliver on your personal New Year’s resolutions.
Rather than despairing about all those unrealistic “get fit” goals, how about refocusing your energies on some professional resolutions that will truly benefit your procurement career? The beauty of these targets is that they can actually be met, and won’t be broken in a cheeky late-night fridge raid.
The year has barely begun but we’ve already heard some profound advice from procurement leaders around the world, but here’s the skinny – the real McCoy – the five goals you REALLY need to focus on to reach the top.
So, grab a donut (breaking a healthy-eating resolution while doing so), adjust your focus and rebuild your resolutions to become a world-beater in 2017.
When visualising what type of procurement professional you want to be, you could do worse than become what The GC Index calls “The Play Maker”. It reads a little like a horoscope, but to quote – “Perfectly placed right in the intersection of all GC Index’s four profiles, this individual is interested in people and relationships. They’re best equipped to take on the all-important task of stakeholder engagement, but also managing upwards (C-level) and outwards (supply markets). Play Makers at their best will lead through building productive relationships and helping others to do the same”.
To me, the Play Maker sounds like the perfect procurement professional. A relationship expert who is equally at ease managing the C-suite and suppliers will go a long way very fast.
BME’s landmark Procurement 4.0 study also highlighted how procurement will need to network both vertically and horizontally, inside and outside the organization, to thrive in Industry 4.0.
Put on a show
CPOs today are paid to drive global change and (in case you didn’t know), storytelling lies at the heart of every successful change programme.
I recommend that CPOs and other change-drivers adopt the “the Disney formula”, which involves a core idea (the story) being cleverly communicated through a number of different channels. This technique can be easily adapted into a formula that’s relevant for procurement pros: “the book, the movie, the merchandise, the ride – and the tweet”!
If you can’t see how Disney’s storytelling formula could be adapted to your change-management programme, there’s no need to reinvent the wheel. Save yourself some time and energy by finding your own inspirational company who demonstrate best-practice, steal their formula, and get to work!
Network your face off
The “n-word” makes most people cringe and break into a cold sweat – but overcoming your fears and mastering the art of networking is well-worth the effort.
Here are the facts – professionals with larger networks earn larger salaries, they’re offered more professional opportunities, they stay in their jobs longer, they are more “in the know”, and (last but not least), they’re happier!
If one of your resolutions is to build a habit of continuous learning, you’ll need to throw out your old perceptions of professional development and adapt to the brave new (online) world. You can now access the latest thinking and procurement insights on your laptop, smartphone or other device, 24 hours a day, 7 days a week, 365 days a year. This means there is absolutely no excuse for you not to be plugging those career competency gaps!
Procurious’ learning section is organised into bite-sized microlearning videos ranging from 2–12 minutes, giving you the ability to learn from the best in the business in the time it takes to fetch a coffee.
Never forget that simply asking questions is often the best way to get the answers you need. With 19,000 members (and counting) on Procurious, the possibilities to engage in insightful and relevant discussions are limitless.
Finished your cheeky donut? While you’re picking at the crumbs, let’s make a commitment – to our professional selves, to our procurement teams and to our companies – to supercharge our procurement efforts this year with relevant and achievable career goals. Here’s to an exciting and transformative 2017 for everyone!