This week, Vendor Centric's CEO Tom Rogers joins the Source One Podcast to discuss his contribution to Procurement Transformation: Industry Perspectives. Providing additional insights and context, he reminds listeners that Procurement (and the organizations it supports) can no longer afford to focus on compliance alone.
For decades, Procurement has operated as a largely tactical function within most organizations. Enforcing compliance on an "as needed" basis, the department has rarely performed to its full potential. Rogers, an expert in Vendor Relationship Management, maintains that today's digitized and interconnected supply chains provide a golden opportunity for Procurement to evolve and accept a more nuanced role.
The evolution of cloud-based technologies and the emergence of an "open source information environment," Rogers suggests, leave organizations vulnerable to a slew of new risks. Many have already learned the hard way that a dedicated approach to third-party risk management is no longer optional. Rather, programs and committees focused on managing and mitigating risks are an absolute necessity for organizations looking to avoid embarrassing headlines, hefty fines, and lost revenue.
Rogers believes that Procurement should enjoy a prominent role within these programs and committees. He is careful, however, to caution Procurement against going it alone. He suggests that few Procurement teams are "fully equipped to perform the necessary duties and facilitate the necessary conversations" at present. Evolving risks mean Procurement, too, must evolve sooner rather than later.
It's essential that Procurement build the business case for its own transformation. As the department evolves, leaders from across the organization will take notice and continually invest in the function. More importantly, however, Procurement needs to take the lead in making risk management an enterprise-wide concern. "Risk management," Rogers concludes, "is not just a Procurement issue. The department needs to be in concert with every internal stakeholder to ensure it's recognized as a priority for the entire organization."
Check out the full conversation.