A focal point of Procurement Leaders’ community activities in 2025 will be exploring how the relationship between procurement and other key internal stakeholders must evolve to meet the demands of this increasingly topsy-turvy world we inhabit.
It’s nothing new, you might think. Stakeholder engagement is a fundamental part of the role and various approaches exist, including procurement working directly with critical functions – aligning itself both physically and metaphorically to help deepen relationships and understand stakeholders’ needs more comprehensively.
This might be true, but CPOs would still do well to take a step back and think deeply about what other internal functions really think of them.
Last week, we ran a call that was focused on precisely this topic – how to build better relationships to drive better results. Joining us was Jens Hentschel, founder of consultancy firm Fivis, who specialises in building bridges between procurement and sales teams.
Jens explained to the group how he had conducted research among sales professionals about their perceptions of procurement. “We were asking them: ‘What do you think about procurement?’,” he said. “And most of them tell us: ‘We have absolutely no clue who the buyers are in our own organisation.’”
Jens had already revealed how the CFO of a major FMCG company had shared how frustrated he was with procurement’s KPIs being misaligned with company performance, leading to an overall sense that we still have much work to do as a function.
“The issue is really twofold,” Jens continued. “We are not relaying to our supply base the value we can create and we’re not articulating to our internal stakeholders our reason for being. How can we be of help to drive and address business needs, [for example]?”
If this all sounds like procurement 101, frankly it is. But time and again I’m struck by how seemingly foundational aspects of the procurement process could be improved and how other business stakeholders are less than gushing about the function’s contribution.
Some of this is ignorance, but much of it is procurement failing to communicate properly and not being aligned with business priorities.
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