Source One's new Procurement Transformation eBook is here. Spread over nearly fifty pages, Procurement Transformation: Industry Perspectives sees nearly a dozen Supply Management thought leaders offer their reflections on Transformation and present best practices to today's organizations.
Procurement Transformation is a huge topic. Every organization defines the term differently and goes about refining Procurement in its own unique way. "When we initially published Procurement Transformation: Industry Perspectives as a five-part series," says Associate Director Jennifer Ulrich, "one of our primary goals was to communicate the enormity and complexity of the topic. We also hoped that capturing a diverse range of perspectives would help demystify Procurement Transformation and inspire organizations to pursue Transformations of their own."
Predictably, Procurement Transformation: Industry Perspectives is positively loaded with insights and supply chain wisdom. We can't describe all of them here, but here are a few key takeaways from this comprehensive look at Procurement Transformation.
1. We've Been Discussing Procurement Transformation Since At Least The 1980s
Jim Baehr (Sourcing Strategies Group) opens Procurement Transformation: Industry Perspectives with an overview of Procurement's decades-long evolution. The shift from tactical obscurity to strategic prominence, he suggests, began in earnest with an article in the Harvard Business Review. Penned by Peter Kraljic, "Purchasing Must Become Supply Management" laid the groundwork for our present-day understanding of Procurement's strategic role. Though it took years for Kraljic's wisdom to truly take hold, his essay was immediately popular. Even today, Baehr believes, Procurement professionals can learn a great deal from giving it a read.
2. Procurement Transformation Could Use a New Name
In Part II, the Art of Procurement's Phil Ideson suggests that more Procurement Transformations would succeed if they went by another name. The term "transformation," he suggests, is at once misleading and potentially frightening. He writes, "Think of the word . . . It suggests a complete overhaul, a total revamp, a metamorphosis." Even bold organizations might feel scared at the thought of starting completely anew. What's more, "Procurement Transformation" suggests that Procurement is the only department who will benefit from such initiatives. Procurement Transformations aren't really transformations at all. Nor are they really about Procurement. "It sounds like a paradox." he concludes, "but the most successful Procurement Transformations are those conducted without a strict focus on Procurement or Transformation."
3. Talent Still Beats Any Tool
Naseem Malik (TYGES) opens his contribution with a question. He asks, "What's the most important tool for constructing an effective Procurement department?" If you're a firm believer in the hype surrounding new technologies, his answer might surprise you. "Even in the days of consistent innovation and endless forecasting," he writes, "people are still what separates world-class Procurement departments from the pack." He suggests that every Procurement Transformation should aim to refine the department's approach to talent management. With more strategic techniques for recruiting and retaining talent, Procurement will stand out within the organization and secure its more prominent seat at the table.
4. Buzzwords are Dangerous
Everybody wants to stand on the cutting-edge. Procurement, long dismissed as a tactical function, is particularly eager to set itself apart by identifying the next world-class technology. Maybe that's why industry blogs are so fond of speculation and hyperbole. JAGGAER's Kristian O'Meara discusses this situation and advocates for curious skepticism throughout his contribution to Procurement Transformation: Industry Perspectives. Any and all buzzwords, he suggests, are potential stumbling blocks for the department. They fuel unrealistic expectations and - at their worst - lead Procurement to waste time and resources on tools that will only exacerbate their inefficient practices.
5. Procurement Technology Still Has a Long Way to Go
While he avoids the dreaded buzzwords, Sourcing Innovation's Michael Lamoureux sings the praises of emerging technology throughout his installment. Many organizations, he writes, believe they've already transformed by embracing eSourcing. To say these companies have a lot to learn constitutes a major understatement. While there's nothing wrong with existing solutions, Lamoureux is quick to remind readers that they provide only a fraction of what the future promises. Advanced sourcing tools, he writes, will provide next generation savings and efficiency thanks to predictive analytics, Should Cost Modeling, and decision optimization. For the tech-savvy Procurement professional, the future certainly looks bright.
6. For Procurement, Perception is Reality
In one of the eBook's final chapters, Source One's Diego De la Garza explores the aftermath of a successful initiative. A successful initiative, he reminds readers, is only the beginning. He writes, "I'm a firm believer that perception is reality." By this he means that Procurement can only produce value if leaders from across the organization perceive it as a strategically valuable entity. Proving itself valuable, he says, often means translating Procurement's wins into the 'language' of other departments. With an emphasis on 'enablement,' Procurement needs to take the lead in communicating what it can bring to every individual unit within a company.
That's just a tiny sampling of the insights included in Procurement Transformation: Industry Perspectives. Download this must-read supply chain eBook today.