I was fortunate enough to attend the 14th Annual
Strategic Sourcing & Supplier Relationship Management conference in
Chicago, IL, which featured a host of top executives discussing ways to drive
competitive advantages through better, more collaborative supplier
relationships. One of the main themes
explored throughout the two-day event was how to build and deploy a successful
Procurement Transformation.
In what was quite possibly the most enlightening keynote
session, Terry Simmons, Vice President of Purchasing and Supplier Management at
AbbVie, recounted how AbbVie has continued to modernize their entire
procurement division to maintain a competitive advantage in an ever-changing
market.
I had the opportunity to interview Terry to take a deeper dive
into some of the lessons learned throughout the change initiative thus far.
Having embarked on a complete evolution of Procurement, Terry
spoke to the trials and tribulations of redesigning their procurement and
supply management processes, but the key takeaway from our discussion was that the
impetus for a truly successful Procurement Transformation are the people.
Kaitlyn Krigbaum: It sounds like a lot
of changes are underway at AbbVie—embracing the culture of digitization,
greater alignment across the enterprise, and even greater inroads in supplier
innovation through more strategic relationships. It’s clear from an outside perspective that
AbbVie has come a long way in the last five years, but it begs the question:
where did you begin, and what best practices can you share with other companies
looking to rollout a similar holistic transformation plan?
Terry Simmons: One piece of advice is
to stay true to your vision or mission as a company. Our vision is to be recognized for delivering
consistently innovative medicines that have a remarkable impact and change
people’s lives for the better. We’re
truly patient-focused, and kept this ideology at the forefront throughout the development
of a transformation strategy. By
creating a sense of purpose behind the work, people work harder.
Another key
element to a successful Procurement Transformation is starting with where you
actually are, not an idealized state.
For instance, we built out a five year roadmap, and to use a sports
reference, we had a great “playbook” and knew our opponent [targets procurement
needed to hit], but we needed to have the right team to execute on that
playbook. We began by evaluating our
people, and whether everyone was in the right role where they could make the
greatest impact. If not, we moved them
to a role that was a better fit.
Kaitlyn Krigbaum:
So building a high-performing team is imperative to the success of a change
initiative. My follow-up question would
be how do you successfully develop a team?
“Our culture is the foundation of
our success.”
Terry Simmons:
It’s really a matter of knowing the personality of the organization, and
managing your team the same way you coach them.
Our culture is the foundation of our success. A good leader takes a different approach
towards the development of their team.
Career advancement requires unique approaches, rather than a
one-size-fits-all management approach.
Take introverts versus extroverts, for example. For extroverts, the focus may be on getting
them to channel their energy and be a processor, whereas for introverts, it may
be not only building their knowledge, but sharing their insights with the
broader team, since so often they act as the sponge of the group. I tell my team to “be curious”—network, look
at what other departments do, analyze other roles, and determine how we as a
function can better support them.
As a leader, successfully developing a team is often a
matter of knowing how far to stretch people, and recognizing their potential
even before they do. At AbbVie, we encourage diversity of approach and a
culture of inclusiveness. We encourage spontaneity and stress the danger of
stagnation. Different types of people find
harmony as categories continue to merge throughout a transformation
rollout.
Kaitlyn Krigbaum: That makes sense to
me, build the right team with the right leader and you’re on your way towards a
successful Procurement Transformation; however, the leader and the team are
both Procurement specific, it seems. Is
there anything you recommend doing early on to increase awareness of the change
initiative and the value Procurement can deliver to the rest of the
organization?
Terry Simmons: We strive to leverage
our relationships with key business stakeholders to ensure a clear
understanding of the upcoming change and how it benefits or affects their
organization. While having those
conversations well in advance can be a challenge, we have found that when we
do, it gives both leadership teams an opportunity to discuss the best approach
for the respective organizations. Knowing the barriers to success at the front
of the change initiative gives the organization time to re-adjust the approach
to fit a specific organizational business need.
Kaitlyn Krigbaum: Great, thank you for
sharing some key insights. Any parting
words of advice to organizations as they rollout their own Procurement
Transformations?
Terry Simmons: Set expectations up
front with the Procurement team and other stakeholders, and leverage your
pull—try to use all levers—rather than pushing an agenda. Allow people to fail – failure is often the
journey to success, and as long as people are learning, it’s a worthwhile part
of the experience. Keep people engaged
for the long run, and continually monitor progress.
This interview has been edited and approved
by AbbVie.
Terry joined Abbott Laboratories in 2012 as Vice President,
Purchasing and Supplier Management and as of January 1, 2013, he assumed these
duties for AbbVie.
He has an extensive
background in total procurement and supplier management, including experience
with both domestic and international purchasing. He re-joined Abbott Laboratories in 2012 from
Baxter, where for five years he was Vice President of Global Purchasing. Prior
to his tenure with Baxter, Terry served as Vice President, Purchasing and Real
Estate at Hospira, Inc. He has also held
positions of increasing responsibility in procurement, administration and sales
with McDonald’s Corporation and Abbott Laboratories.
Terry received his bachelor’s degree in communication from
the University of Minnesota. He is an
active member of the National Association of Purchasing Managers and the AMA
Purchasing and Supply Chain council as well as collegiate affiliations in
Illinois and Minnesota.
