Cost-cutting remains top priority

6 November 2009

6 November 2009 | Allie Anderson

Cutting costs will continue to be the most pressing issue for purchasing next year, according to a poll of delegates at the ProcureCon conference in Brussels this week.

In response to the question "What is the key issue for your department in 2010?", almost one-third (32 per cent) said it was reducing costs by 5 per cent or more.

Managing risk and maintaining continuity of supply was voted the second most important issue, while retaining talent was the top concern for 20 per cent of delegates.

Asked "What has helped increase your organisation's efficiency most?", 36 per cent gave the answer SRM, while 20 per cent said shared service and purchase-to-pay technology has proved most effective. For 16 per cent, outsourcing and offshoring had led to greater efficiency and a further 16 per cent had seen the greatest improvements through e-sourcing and e-auctions.

The next question put to international buyers was: "The economic downturn has put pressure on suppliers. What have you done to respond to the risk imposed by the economic downturn?" The largest number (36 per cent) said they had conducted a full review and had activated a risk mitigation plan. Some 21 per cent had taken steps to monitor suppliers so they were in a position to act if problems emerged. Only 7 per cent associated a low level of risk with their suppliers.

The final query in the interactive survey was: "Given the demands placed on procurement professionals are growing and becoming more complex, which key skill set is in short supply?" More than a quarter (28 per cent) said they must get better at dealing with stakeholders, while the need to address change management and project management skills was cited by 18 per cent and 17 per cent of respondents respectively. A lack of sourcing and negotiation capabilities was a problem noted by just 3 per cent of the buyers.

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