Wie fit ist Ihr Einkauf?

In a series of ten regular posts published by the Procurement Leaders Global Intelligence Network I looked at the different facets to transform procurement to a partner of choice

Part 9 - people matter most

2013-12-03 14:08


Thought Leaders is a series of regular posts from experts across industries and regions, looking at the issues procurement faces today. This is my ninth in a series of 10 posts looking at the different facets to transform procurement to a partner of choice.

Procurement has been faced with fundamental changes of the business environment over the last few years and from my point of view there is one decisive factor to turn trends into opportunities: people.

The transformation from a traditional purchasing department to a modern service unit requires a radical change of style and mindset. Experienced managers charged with the restructuring of a company's procurement operations are aware of that hurdle and start their job by determining who of the staff is able and willing to support the endeavor and who is not. Based on my own experience this may lead to a replacement of more than 50% of the management positions to establish a leadership team that is "pulling the cord".

The next step is to define job profiles and corresponding skill sets and to conduct a gap analysis, i.e. identify strengths and improvement needs of each member of the procurement team - in particular regarding four areas which are pivotal for the new role:

  • Social skills
    Collaboration with suppliers and procurement colleagues from other countries and cultures as well as the participation in cross-functional teams with R&D, manufacturing and marketing requires excellent communication and leadership skills. A centralized and "remote" procurement department will only thrive if backed by active business partner relationship management.
  • Methods and tools
    Total cost of ownership along the life-cycle of products and services, target-costing, cost structure analysis, conflict management and applied game theory are just some elements out of the tool box of a professional procurement manager today - beyond the traditional (and still important) market knowledge and negotiation skills.
  • Supply Chain Management
    Category managers need to understand and manage the risks and opportunities along the entire supply chain. Monitoring of compliance to corporate contracts negotiated is part of their responsibility.
  • Entrepreneurship
    Active search for new opportunities on the global marketplace as well as the capability and the rigor to focus on the real value adding activities and outsource non-core activities to external specialists must become part of the procurement DNA.

The results of the gap analysis are reflected in a systematic training and development plan that includes the agreed measures for each individual employee and the procurement organization - often referred to as Procurement Academy. At DPDHL we established such a programme some years ago under the logo "Fit4Procurement". It was developed and implemented in cooperation with HR and international procurement academies for more than 40 countries to ensure a coherent qualification in all locations.

One of the challenges companies face is to keep such a programme alive - once the staff has gone through the first training wave - and adjust it to the changing needs of the business environment. Furthermore, trainees often are eager to refresh their key learnings from the courses and stay abreast of new developments. Modern IT platforms which have emerged over the last years adress this demand and allow procurement employees via e-learning tutorials and web-sessions to create their own training programmes according to their individual needs.

No doubt, a systematic training and development is an investment in people that will cost money and time but experience from best-practice companies shows that it pays off at the end of the day.

And so we're back to the crucial understanding that underpins the process: people matter most ...

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