Time pressures a challenge for majority of buyers – study

25 May 2015

Global procurement executives cited time pressure and gaining internal stakeholder engagement as some of the keys challenges they face as part of Xchanging’s 2015 Global Procurement Study.

Talent shortage – a common complaint among senior buyers – was less of a concern for the 830 procurement decision-makers surveyed across Europe and North America.

Eighty per cent of respondents identified procurement team time pressures as a challenge, with 20 per cent considering it a "major challenge”.

The study talked of a “perception gap” between mid-level buyers and those representing procurement at an executive level. Sixty per cent of CPOs feel procurement is a board level priority in their organisations compared to 37 per cent of procurement middle managers.

Some 63 per cent of respondents described internal stakeholder engagement as a challenge, and 14 per cent cited it is as an "extreme challenge".

There was also a discrepancy between the wide-ranging responsibilities procurement decision-makers believed they faced and the KPIs by which their performances were being measured. Some 47 per cent named ‘cost savings realised’ as their number one KPI. All other listed KPIs were cost-related and sustainability impact was ranked as the least important.

Chirag Shah, executive director at Xchanging Procurement said: “These results strongly indicate that there is a problem with the current KPI structure. Procurement teams are responsible for many critical functions. From risk management to sustainability impact, procurement is engaged in activities that far surpass its cost-cutter legacy. The metrics against which organisations track procurement’s performance do not line up with what procurement actually delivers.”

Talent shortage was considered an operational challenge by 59 per cent of respondents, but only 12 per cent believed it to be an extreme challenge.

Shah said: “While our study confirms [talent shortage] is still an operational challenge, there is a much bigger issue in the form of ‘team time pressures’. The main problem isn’t a lack of available talent but insufficient capacity within procurement.”

Respondents said the skills they considered most important for procurement professionals were relationship management (considered important by 88 per cent and very important by 59 per cent) and negotiation skills (considered important by 88 per cent and very important by 58 per cent). But these were also the areas where procurement leaders saw the biggest lack of skills.

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