From my recent conversations with procurement and supply chain professionals, it appears the skills needed for success are changing - and so is the image of the profession.
Historically procurement has been seen as a cost saving function, obsessed not with what is best for the business but what is best for the bottom line. But the realisation of the benefits of effective supplier relationship management and the subsequent pay offs means the focus now relies much more on mutual success, not financial rationalisation.
This form of strategic procurement is a key way to test supply chain relationships and to ensure sourcing methods are intact. Indeed, when outsourcing (or smart sourcing/right sourcing as it has become known) it is not simply cost that rules the day. There is a trend towards centralisation, collaboration between suppliers and collaborative contracts to increase efficiencies.
Beyond this, another trend emerging strongly in the profession is that of increased emotional intelligence (EI). For those still unaware of this phenomenon, put simply EI is the ability to perceive, reason, understand or manage emotions effectively, and this is becoming increasingly relevant.
Procurement has become a people business and understanding motivations and intentions of individuals, and therefore emotions of the different stakeholders, has become crucial. As procurement evolves to become a business-focused function, developing and maintaining personal relationships will lead to more successful outcomes – both internally and externally.
Many procurement interims I speak to find the “hit the ground running” mentality required of them in a new assignment is no longer just about operational or industry knowledge. Real success depends on building strong emotional relationships, both inside the company they work for, as well as with the suppliers they deal with. Understanding on this level with all stakeholders will ensure procurement finds tailored solutions and benefits which in turn builds stronger long-term relationships, more effective negotiations and financial savings. This will also further procurement as a key strategic business partner.
☛ Emma Richards is head of the procurement and supply chain practice at Alium Partners
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