This familiar question was tackled by Mark Hollison, director of procurement at Napp Pharmaceuticals
, at Procurecon Pharma 2012
He quoted a survey on skills shortcomings among procurement people, with 64 per cent of practitioners failing to demonstrate the requisite skill level when it comes to ‘executive influence’. In contrast, traditional procurement skills of analysis and negotiation are seemingly well-covered, with only 35 per cent and 25 per cent of practitioners respectively failing to meet the standard in these areas.
Hollison made a plea to procurement leaders to cede control to increase influence, arguing procurement needs to consider ‘giving away’ purchasing and supplier relationship management responsibility to willing stakeholders. This represents a somewhat brave stand in a profession that continues to hold aspirations of increasing spend control and board-level influence, but I think he is onto something.
What he’s suggesting is the procurement role changes from an unresponsive doer to a trusted advisor, enabling stakeholders to act quickly and decisively, knowing they are able to call upon support from procurement when they need it. He feels (and I agree) a community of liberated stakeholders are more likely to be willing to collaborate with skilled procurement advisors who are comfortable with the advisor role, rather than those unable to avoid temptations of functional imperialism.
But how do you define the role of the ‘trusted advisor’? Try this: A trusted advisor supports the business leadership in improving procurement performance and provides the main source of expertise to the business on the application of the procurement processes and toolkit.
The theme of ‘influencing without executive authority’ is a growing one in procurement and, as procurement’s stakeholders come under increasing pressure to secure value for money for the products and services they use, this trusted advisor role may have come of age.
In this world, Hollison believes that purchasing becomes a nexus for commercial expertise and intelligence - a proposition quite different from that of the traditional ‘buying office’.
What this could mean for the profession in the longer term is smaller teams of procurement experts, with outstanding consulting skills, capable of building trusting relationships and working jointly with stakeholders on category and relationship strategies.
What’s certain is this will require buyers to develop a range of consulting and leadership capabilities beyond those in the technical procurement curriculum. It would be interesting to see which organisations are the pioneers in this regard.