Many have opinions on the future of Procurement, and thestart of a new decade has inspired many to take a look back to shape what their
future will look like. This has contributed to many takeaways, but among them
all, I think the most looming is a sense of uncertainty. We are undoubtedly
heading towards a crossroads in Procurement, with only a small number of
Procurement organizations prepared to handle the complexities of the future. These
well-equipped organizations have embraced the factors contributing to this
crossroads for Procurement and found ways to overcome these challenges
proactively. In an effort to help address these challenges, here are 5 ways you
can boost your legacy Procurement function and increase your influence within
your organization:
1. Understand Your Maturity
For some, you may already know the
level of maturity for your organization, but for others this is the first step
in gaining efficiencies, building your business case, or revamping your
organization or team. The important thing here is to remain as objective as
possible, whether that means an independent auditor or consultant evaluation or
by taking a hard, honest look at your processes. An independent, objective
assessment is your best bet, but you can familiarize yourself with thought
leadership and industry best practices and compare your standards and
practices, but this requires objectivity that might be difficult. If you
understand how your team fares from what most considered a leading best
practice, you can begin to work on process improvements and efficiencies needed
to take that next (or first) step.
2. Know Your Metrics
This may sound like a no-brainer,
but understanding your metrics and how you measure performance is important and
critical to your success. This means measuring performance of your suppliers
based on KPI’s and service levels, tracking your invoices and PO’s, tracking
your own team’s cycle time, et al. You need to know how you and your organization
measure success and find ways to be more strategic. For some this is avoiding/eliminating
spot-buys or consolidating your supplier list, but you can expand and generate
more opportunities to be strategic. Examining your metrics is a great place to
start to identify initiatives and better understand how your team or
organization functions (this should only be the tip of the iceberg!).
3. Tighten Up Policies
Once you’ve reviewed your data, it’s
probably time to start reviewing your policies. If you have a strong grasp on
your numbers and metrics, then this might just be a refresh, but if your data
and metrics are in disarray or unorganized, now is the time to strengthen your
polices. This step might be tough without support from the top, but the goal of
a policy refresh should be to identify gaps in your current state and then updating
and adjusting accordingly. Moreover, now is the time to enforce your policies.
Don’t let your team, the business team, or suppliers deviate from any policy
you’ve established. However you chose to do so is at your discretion, but
accountability during every step in this policy refresh is vital to continued
success. Policy and procedure is where it all starts and strong policy and
procedure eliminates any potential for gaps and ensures compliance.
4. Build Your Brand
This one may need a little finesse,
but ultimately you want to present an image of a well-oiled machine with the
flexibility to address more complex buys or initiatives. This may just be an
internal rebrand or a soft re-org or this may be the first step in gaining
senior level buy in. In any event, whether you’re rebranding your team or just
beginning to build your brand, start smaller if you can. Pick a category or
line of business and test out new policy or procedure, observe what works and
what doesn’t, and then try to implement on a larger scale. Some may argue
against this due to complexities or nuances of certain categories or calling
this low the hanging fruit, but starting small lends you the flexibility to be
creative and test the waters. The purpose of this exercise is not use a small
sample size to apply all your new strategies, but to test policy and procedure
or launch small updates to existing process. In essences, this is where you can
start to grease the wheels while you build your brand or business case for
larger influence.
5. Be Proactive and Collaborative
Like most aspects of our everyday
life, being proactive is always a wise decision that can eliminate any stress
further down the road. But, when it comes to Procurement being proactive can lend
credibility within your organization. Taking the next step or reviewing your
policy and procedure before any fire drills shows you are always thinking
ahead, planning, and being strategic, an ideal image needed for any Procurement
organization. Additionally, we need to be willing to adopt cross-functional methods
or solutions from outside our bubble to embrace the complexity of what the
future for Procurement looks like. Reaching
out to other teams within your organization shows you are willing to
collaborate and are open to incorporating some practices from outside
Procurement. Always be on the lookout for opportunities to collaborate and be
proactive and don’t accept stagnation for your team. If we’re always looking
for continuous improvement, we won’t fall back into our old habits.
