Just 31 per cent of senior procurement professionals surveyed by Efficio Consulting has an annual plan covering all areas of procurement that is used internally to drive work.
The snapshot survey of 260 people, at the ProcureCon conference in Berlin, asked how important undertaking an annual review on the potential of procurement was. Twenty-six per cent said they had an annual business reviews process in which they present their plan for delivery of procurement value that has been reviewed and signed off by stakeholders.
However, 40 per cent of respondents do not undertake a formal annual review of the potential within procurement at all. “This provides substantial room for improvement,” said Toby Munyard, vice principal of Efficio Consulting.
Respondents were asked why procurement is not currently viewed as a “value creator”. Three reasons for this received broadly the same proportion of responses: the function’s late involvement (38 per cent), lack of stakeholder engagement (37 per cent) and the business not truly understanding procurement’s capability (35 per cent).
However, 43 per cent of respondents have well-defined key performance indicators that are either actively tracked and accessible or aligned to the business with proactive leading indicators. The majority (60 per cent) of respondents said that stakeholder management was a skill needed for procurement to be a “value creator” while 43 per cent said strategic sourcing and negotiation.
“We see that value creation through cost optimisation still is a key deliverable for CPOs, along with talent development and SRM e-tools,” Munyard added.