Lisa Malone writes from The Smart Procurement World Conference, held this week in Johannesburg, South Africa (On Twitter? Follow @SmartSPW).
With the exception of Supplier Development (more on this in a future article), technology, specifically Cloud-based solutions and social media, has been the hot topic of this Smart Procurement World Conference.
This should come as no surprise really… Technological change has never been more rapid, nor impacted more areas of the business. Today everything from regulatory requirements, internal controls, data mining, business intelligence, supply chain visibility and customer experience, are largely controlled by technology platforms.
Technology has not only changed the way we are running our businesses internally, but increasingly businesses are pivoting and building their entire value proposition on the back of technology.
Take for example some of the globe’s fastest growing businesses: Uber and Airbnb have both disrupted their respective industries and rather than a physical product or service, have a technology interface at their core.
Between robotics, artificial intelligence, 3D printing and Terahertz imaging, technology is undoubtedly disrupting the way every business operates. For some, this paints an exciting vision of the future, but for others it’s downright scary.
What all this change makes implicit is the growing importance for CPOs to develop closer working relationships with the CIO.
Mariette Steyn, VP Supply Africa, South 32, opened discussions on the Ariba Panel today by saying CPOs need to have a much greater appreciation of the business’ technology roadmap.
“CPOs must develop a much deeper understanding of the role technology will play in the future of their industry and business.
“With technology so central to competitive advantage, buying technology at the lowest price will rarely be seen by the C-Level as delivering value.”
Mariette’s second observation is that CPOs now, more than ever, need to speak the language of the business.
It should be noted that the ability to have intelligent conversations with functional stakeholders (and particularly, being able to speak the language of finance, is nothing new.
If you’re not aged between the ages of 13 – 17 (where this kind of linguistic ability is achieved through osmosis) or a bona fide technology-geek, talking tech can be especially tough. The mere mention of Tweets, hashtags, or tera-bytes, never mind API, RSS feeds and Xcode and plenty of CPOs’ eyes will simply glaze over.
But with technology increasingly becoming the business (rather than a physical product or service), tech literacy will soon be fundamental for every businessperson and in particular, CPOs.
It goes further than this: In the resources sector, where cash is king, Maria explains it’s not simply about being able to talk the technical advantages of Cloud. The best CPOs will be multi-lingual, jumping effortlessly between CIO-ese and CFO-ese.
“In one breath, I need to speak intelligently about Cloud solutions with my CIO, and in the next breath, translate this message, or rather sell Cloud’s to the CFO on it’s ability to scale, accuracy of forecasting and where it makes sense, the benefits of moving spend from CAPEX to OPEX.”
If only it were that simple… These days you’ll be expected to help your CIO articulate potential financial implications in one breath, while bestowing the benefits of using operating expenses to account for technology investments in the other.
Speaking from their own decoupling with BHP Billiton, Mariette also explains that in their case, the conversation could be framed in terms of Cloud’s advantages in a demerger environment.
“Not having to physically pick up a server means you can exploit the technology and decouple technology far more quickly.
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