In this three part blog series, our experts share their supply management and procurement predictions for the upcoming year. In Part I, we took a look at how procurement is growing as a trusted resource in the organizations they serve, the ongoing challenge of lacking spend visibility, and how organizations are no longer measuring procurement groups on savings alone.
In our follow up article, our executives weigh in on the industry's renewed interest in consultant support, how the talent pool is affecting operations, and how companies are looking at building long-term strategic relationships with vendors and suppliers.
Renewed Interest in Outside Help
There’s no doubt that strides in supply management software solutions have provided relief for procurement professionals, however based on Source One’s experience supporting hundreds of clients achieve their procurement goals, we know that software isn’t the sole answer to all the varying category-specific challenges. While e-Sourcing solutions provide organizations significant value in their own regard (e.g., streamlining processes), it doesn’t eliminate the need for man power in the form of procurement and strategic sourcing subject matter experts and analysts. In fact, over the next year, our executives foresee a growing necessity of capable, adaptable, and flexible resources to boost procurement operations and procedures – particularly for managed services. The challenge, however, is understanding the right type of provider for your organization. As we’ve seen over the last year, gone are the days of strictly outsourcing tactical procurement tasks. The future of procurement begins with understanding the maturity of your current operations and selecting a managed services provider that suits your needs and can help you get your operations to next level.
Turbidity in the Talent Pool
As Procurement gains its footing as a strategic advisor, the demands on the function as well as the quality and capability of the professionals staffing the organization are only anticipated to increase. However, as we’ve learned throughout this past year, finding and retaining top talent is a major challenge for organizations. High performers are tough to find, and in many cases even harder to attract. These top procurement talents are in high demand and are aware of their plethora of options when it comes to selecting an employer. What does this mean for companies looking for this top talent? It means facing the challenge head on with internal stakeholders to gain the buy-in to offer competitive salaries to better attract procurement talent. Our experts predict a growing need for procurement leaders to turn to their HR managers to do some convincing on the necessary salaries to attract and retain much needed talent.
Creating Strategic Relationships
On that same note, cost will also lose some (but, not all) of its grip as the primary consideration for purchasers when selecting a new provider or supplier. Gaining steam are the value-ads suppliers or agencies offer, such as unique tools, subject matter experts, technologies, etc. Guiding this trend is the demand for strategic partnerships with suppliers companies. 2016 will be the year of fostering the evolution happening within procurement leading companies to select partners that will simplify category management and unlock innovation.
Taking a Holistic Look
Also on the outs this year: segmented investments. While segmented purchasers never really were ideal, organizations have commonly found themselves plugging holes with different technologies and tools as different needs or challenges arise. Instead, based on our experience supporting sourcing engagements for the Fortune 1000, Source One’s executives anticipate procurement departments and company leaders pausing to ask “What are we trying to achieve as a business?” as a guide for making major purchasing decisions. Keeping this question in mind will allow companies to select solutions aligned to their overarching needs, promoting consistency and enabling long-term growth.
What else lies ahead for procurement and supply management professionals? More to come in our final installment of The Future of Procurement Prediction series.