Successfully carrying out an initiative - even a transformative one - doesn't mean Procurement has reached its full potential. Even the most comprehensive overhaul is just the start for a function that should consistently contribute strategic value and empower other business units to do the same.
In Part 4 of Procurement Transformation: Industry Perspectives, a trio of Supply Management thought leaders discuss the days, weeks, months, and years that follow a successful transformation. It's during this period that an initiative's success is truly determined. Can Procurement maintain momentum and instill a desire for continuous improvement across its organization, or will the business gradually slide back into the old way of doing things?
Vendor Centric's Tom Rogers kicks off "The Road Ahead" by taking a look at some of Procurement's new, more strategic responsibilities. The function, he suggests, boasts great potential as a supply chain risk manager. No longer focused on mere compliance, the best Procurement teams can act as strategic guides for their business.
Offering diverse skillsets and enjoying direct access to the supply base, Procurement is perfectly equipped to assess and answer emerging risks. Rogers is careful, however, to remind readers that Procurement shouldn't perform this role alone. Instead, leaders from Procurement should serve as members of dedicated and well-staffed Vendor Management Committees. Leveraging their wide range of perspectives, these groups will help ensure the business transforms into a a more secure and strategic entity.
Michel Lamoureux of Sourcing Innovation continues by discussing emerging Advanced Sourcing technologies. He writes that new tools empowered by "Analytics, Modelling, Optimization, and Predictive Analytics" will fundamentally transform Procurement and its capacity to realize strategic value.
Paying particular attention to Should-Cost Modeling, Decision Optimization, and Predictive Analytics, Lamoureux presents these tools as the cure to many common sourcing concerns. Should-Cost Modeling, for example, will provide insights that simply asking around for bids cannot. They'll supplement existing sourcing suites to provide Procurement with new levels of security and insight.
Source One's own Diego De la Garza brings things to a close with a discussion of momentum and enablement. For Procurement to maintain post-Transformation momentum, he suggests, it needs to reveal how it can enable every other unit within the business. By consistently revealing its value, Procurement can present itself as an ideal strategic ally to Finance, IT, Marketing and other business units.
It's not enough, however, for Procurement to produce results. De la Garza stresses the importance of communicating these results effectively. "Procurement," he writes, "must take care to 'translate [their results] into the language of other business areas." Engaging internal business units with the appropriate terminology and metrics will help the department foster a greater sense of collaboration and continually emphasize its value.
Read Part 4 of Procurement Transformation: Industry Perspectives to learn more about that enablement, empowerment, and evolution that follows a Procurement Transformation.