Asif Khan is senior manager – global procurement at DP World. He gives SM his thoughts on the challenges facing purchasing and supply in the Middle East and explains why you should never be afraid to ask for advice. Khan will be a speaker at the CIPS Middle East Conference in Dubai on 26 April.
What are the biggest challenges facing procurement in the Middle East in 2016?
Recently I have seen the focus of procurement shift from gaining organisational significance, reducing costs and ensuring timely delivery to dealing with difficult challenges that include innovation, sustainability, ethical procurement, and changing political and economic situations.
To ensure that organisations maintain a competitive advantage, procurement will need to play a pivotal role in the following areas:
- Awareness. Analysts are predicting further economic slowdown across the Middle East in 2016 as a result of the continued decline in oil prices. This could be one of the biggest challenges for procurement in the region, as it would hit corporate spending and budgets hard.
- Sustainability. Procurement will need to develop supply chains that create and sustain economic and social value. Globalisation has exposed the threats to present economics as well as future environments, resulting in procurement operations becoming more responsible, accountable and proactive about sustainability issues.
- Innovation. Procurement organisations will become the primary advocates for finding new ways of extracting value from their supply chains and will need to ensure that they have the right skills and expertise to support new product development.
- People, people, people. It is essential procurement organisations invest in training and development. Robust recruitment processes will need to be in place to ensure they attract and retain the next generation of procurement leaders.
- Big Data. ‘Best in class’ procurement organisations will need to leverage information to support corporate decision-making processes. They will have to assess their sources of data across the organisation and ensure they have the analytical capabilities to provide real-time updates and insights.
What’s the hardest part of your job?
Dealing with a lack of both internal and external communication.
From an internal perspective, without direct communication with the relevant stakeholders and departments, we are often not aware of the critical issues that could affect our strategic procurement decisions. It has become important to work with departmental decision-makers to maintain communication channels and meet regularly to ensure continuous alignment. Often, any negative perception of procurement across an organisation makes this increasingly difficult to manage.
Similarly, from an external perspective, all stakeholders in the procurement process need to be involved in building strong and trusted relationships with suppliers. It is important to select suppliers who are willing to adopt a partnership approach to doing business. Meeting them on a regular basis will ensure that concerns and issues are resolved quickly to avoid major incidents further down the line.
What’s the best piece of advice you've ever received?
Never be afraid to ask!
People often avoid asking questions because they fear negative evaluation by others. Throughout my personal and professional life I have learned that it is impossible to know the answer to everything. It can be useful to assume that you know nothing to create a sense of humility, allowing you to be comfortable about asking questions.
It can be very daunting to be in a meeting where others seem engaged and comfortable in a discussion. However, if you have doubts, there is a strong possibility that someone else will have the same feelings. Therefore, by asking questions you will be helping yourself and others around you to have a better understanding of the discussion.
Imagine you are about to award a multi-million dollar contract to a supplier, but you are too afraid to ask for a discount. You may not receive anything form the supplier, but by not asking you are missing an opportunity to secure additional savings.
If you had to make one recommendation for developing strategic sourcing, what would it be?
To develop a strategic sourcing plan, it is critical you have a detailed understanding of the organisation’s spending. Conducting a spend analysis will provide a detailed breakdown by category. These categories should be classified based on competitiveness in the supplier marketplace compared to how important they are to the organisation. (Consider using the Kraljic Matrix, a simple four-quadrant model.) This matrix should provide a clear direction towards a sourcing strategy for each category and help identify potential quick wins and other addressable spend categories that may require a more long-term strategy.
What does it mean to be a leader in procurement, and how can they advance in their profession?
I believe that leaders are not born, but made! Everyone can be a leader.
A leader in procurement is someone who has vision – the ability to take a long-term view of the organisation’s objectives and how they can bring people together to work as a team and achieve these objectives.
Modern procurement leaders ensure they involve, consult and empower their team members. This creates an environment that is perceived as non-hierarchical. Leaders also need to demonstrate a high level of integrity, honesty and fairness towards all their team members, resulting in higher team commitment and increased levels of trust.
To advance as a leader in procurement, it is important to fully understand your strengths so you can fully utilise those skills, but at the same time know your weaknesses so that you can work on them. Equally, it is important to coach and mentor your team members so they benefit from your knowledge and experience to support you better. A real leader today builds leaders for the future.
☛ Asif Khan will be speaking in a breakout session on strategic sourcing at the CIPS Middle East Conference 2016 in Dubai on 26 April. Click here to book your place.