Procurement executives from across the globe met in London at the World Procurement Congress to talk about what the future holds for the function. Here are the six things we learnt from those discussions:
1. Procurement needs to speed up:
There was a sense from many speakers that procurement needs to become quicker. But, the feeling was that the rise of real-time information could be the catalyst to drive that change of pace. Tom Linton, CPO at Flex, described to delegates the concept of the living supply chain, demonstrating real-time supply chain ‘health monitoring’ and highlighted the importance of developing speed and data capabilities. He said that “transparency isn’t only about visibility, but about values you share”.
2. Data is key to both personal and team success:
Talking about success both as a leader and as a team, Peter Carlsson, former CPO at Tesla, said that executives needed to embrace data to truly be successful. Carlsson said that the power of data coming to the function from different sources is now an integral part of in the building of strategies and capabilities. Ignoring its potential will only set you and your team back further and further behind the competition.
3. Hidden data needs to be brought into the light:
While data is no doubt useful, a lot of important data still remains hidden. To take full advantage of its potential it needs to now be uncovered, according to Tom Linton, CPO at Flex. “We are trying to get information that is concealed from view and using that to drive our business forward,” he said. Linton added that there were seven rules that his team worked to to find and utilise this data.
4. You need the right people for the job:
Talking about data and having the tools in place to capture it might be all well and good, but when it comes to it the function needs the right people in place to analyse that data. “We are moving to a digitised enterprise led by value creators and thought leaders. We are going to transform our enterprise and our industry together,” said IBM CPO Bob Murphy.
5. You might be looking at risk in the wrong way:
Tom Seal, research director at Procurement Leaders, pointed delegates to new research which suggests that micro-risks, the risks that tend to be ignored by the business, can actually accumulate and cost businesses millions of dollars every single year. Seal suggested functions should look at the ripple effects of all risks and not just focus on the big events.
6. Got to speak the right language:
Like most functions, procurement tends to have its own language with its own buzzwords. Most of the time procurement doesn’t understand the language that other functions use and they don’t understand the language procurement is using. To sell the benefits that the function can deliver it has to learn those other languages, according to Nadia Malek, senior director supply chain at Cirque Du Soleil. “You need to speak their language if you want to change things. It’ll be different for everyone, but that is what you have to do,” she said.
So, start embracing data, find the right people to hire and start talking the language that the rest of the business uses and your function will find itself central to the success of the business in the future.