A key benefit of working from home was supposed to be the removal of geographic limits on jobs – and procurement should be at the front of the queue
The idea of carrying out a procurement role from home has, after a cautious start, become second nature for most practitioners since the onset of Covid-19. But whether you plan to return to the office full-time or embrace a more hybrid future, a new dynamic has emerged over the past year – it’s clear procurement teams no longer need to be based in a single location, or even in a company building, to be effective.
From an operational perspective, that is good news. More than eight in 10 procurement professionals polled by McKinsey & Co feel an omnichannel approach is more effective than traditional face-to-face interactions when it comes to securing new suppliers. But it also has profound implications for recruitment and retention: if you no longer need to hire locally, the world of procurement talent is available to you anywhere. Running a procurement team in Chicago? Why not hire that experienced practitioner from rural Ireland? Team member in the UK planning to move to the Spanish sunshine? No need to watch them leave the business.
Taken to its natural conclusion, procurement can become every bit as global as the supply chains it manages, with individuals scattered everywhere, united seamlessly by technology.
The data suggests businesses like the idea. Recruiter Hays found half (47%) of UK employers thought it was now less important for their staff to be close to the workplace than it was pre-lockdown, while 81% predict workplace structures will never return to the previous nine-to-five office model. A US study earlier this year suggested 28% of businesses were already allowing individuals to work from a different country, though a further 46% were insisting on regular office attendance.
Tap global talent
The benefits are myriad. Not only does remote work make it easier to retain employees and source new talent, it could also aid diversity, bringing a global perspective to previously insular organisations and helping under-represented groups (particularly mothers of young children) compete for status and pay on a level playing field.
Kavita Cooper, managing director at procurement consultancy and recruiter Novo-K, says she has already noticed a shift in attitudes. “The procurement world has adopted more agile behaviour. Previously, procurement people needed to be in the same building as their stakeholders, but now people realise you can still build relationships and understand what’s going on without having to be co-located. More global companies are aiming to have a mix of people as they want to recruit those who mirror the cultural diversity of their international brand.”
Tapping global talent is particularly useful where particular sectors or geographies face specific skills shortages – Gartner says 64% of recruiters regularly struggle to fill roles due to lack of skills.
The home-working revolution has had profound effects in wildly different situations, from helping mitigate the brain drain from the south of Italy (co-operative remote working in Sicily, for example, has seen locals return in their droves from Rome and Milan) to tapping women to take up vacant tech roles in the UK they might previously have struggled to commute to.
Trust in flexible working
For procurement, transitioning to a remote, globalised function plays into the wider agenda of increasing agility and becoming ever more relevant to the business. “Modern procurement success requires the function continue to be professionalised at pace – to elevate our role to be more strategic and to enable the business,” says Nic Walden, senior director and procurement programme leader at The Hackett Group.
“This brings new and raised expectations, including from business stakeholders, and will require we make the most of the great talent available to us through further investment in skills, expertise and capabilities, delivered in ways that ensure we coordinate and collaborate globally across the organisation – whether that be in the UK, New Zealand or India.
“I still see many teams doing great things in certain spend areas or locations, but with further potential untapped – if only the approach could be scaled up more broadly across the whole organisation.”
Walden says telecoms, financial services and technology firms are the early adopters of such procurement models, particularly in Western Europe and North America.
Cooper, meanwhile, says she has already seen flexible working practices during the pandemic open opportunities for a wider pool of candidates, encouraging women back into the workforce and making it easier for CIPS-qualified professionals in the Middle East and Africa to take on global roles.
“2020 showed that we can trust our teams to get the job done – to source, negotiate, contract and manage suppliers even in a fully virtual environment,” adds Walden. “While situations will vary, success requires mapping out a future vision that operates effectively virtually, a plan to reach that vision, and engaging to take your team on the journey.”
Even so, remote working and a global mindset is no panacea – as plenty of businesses that embraced it involuntarily in 2020 will have discovered.
In January 2021, a McKinsey study reported by Supply Management found that 49% of procurement leaders felt productivity levels had been affected by remote work, while 43% had seen a drop in team morale.
Is hybrid more productive?
Remote work inevitably makes collaboration more difficult (unsurprisingly, given 70% of communication is non-verbal), while there is an ongoing issue with managers attributing greater performance to those they can see – Gartner says 64% of bosses believe office workers are inherently better performers than home workers. More broadly, there is a fear in some quarters that remote work will be seen as an opportunity to outsource procurement tasks to the lowest cost territories, sparking a race to the bottom.
“Most organisations are planning at least a hybrid approach to the future work environment, one where more roles transition to either full virtual operations or time is split between working remotely and the traditional office,” says Walden. “Last year showed us that productivity was widely seen to be maintained even with the pivot to virtual operations. Arguably the time saved from reducing travel to meetings or commuting was recycled into coordination, engagement and collaboration efforts.”
Whether the post-pandemic world offers an opportunity to genuinely rethink the way procurement is organised, and how we regard the notion of talent, remains to be seen. But it seems unlikely we will revert to the status quo. As Walden puts it, if 2020 showed us anything “it was how unproductively we were previously spending our time”.