Procurement Transformation

A new era is changing the procurement function, creating broader and deeper roles where buyers also need to be value brokers, and capture, retain and manage talent (Supply Management)

Information about Procurement Transformation

Procurement transformation is a relatively new concept and is usually positioned within wider discussions of change management and transformational leadership (Day and Atkinson, 2004). Although the specific nuances of implementing change within the procurement function differ from change management initiatives in other functions, the underlying principles determining the success or failure of changing processes, practices and behaviours remain similar. A turbulent and unstable political and economic environment, globalisation, technology and product innovations require organisations to develop change capabilities and acquire knowledge of change management. Change management is generally a complicated process which involves complex analytical, political, and cultural processes of challenging and changing the core beliefs, structure and strategy of the firm (Pettigrew, 1987).

The impetus for the procurement function in light of current developments is becoming more strategic and stronger than ever. Procurement transformation relies on the application of various tactical, strategic and transformational tools and techniques and can positively impact many areas: e.g. launching and accelerating cost control, extending, sustaining and renewing cost management and pioneering new business structures (Hughes et al., 2011). Cultural change is generally the major barrier for procurement transformation (Burnes, 2009): "it takes a long time to develop … success has to be visible and well communicated and the new norms and values need to be backed with incentives" (Supply Management).

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