A narrative thread running through both days was that in the last 18 months, procurement had embedded itself as a strategic enterprise partner, largely through the critical role the function has played in supply chain resiliency. A clear takeaway has been that to build on this role, maintaining and enhancing this repositioning, procurement teams require a new set of capabilities.
“Covid-19 has validated our vision to move from doers to thinkers. We are moving from requisitions to being a provider of solutions for the business” Daniel Rodriguez- Director, Pan-American Health Organisation
There were a wide array of different perspectives on what these capabilities should be, and how to develop them- but I have picked out three interesting areas where we saw a lot of commonality;
HYBRID HAS REFRAMED THE WAR ON TALENT
Our first speaker on Day 1 of Americas Procurement Congress was Miguel Gonzales, CPO at Dupont who set the tone for the day in discussing the ‘critical relationship of talent and resilience in the new business reality.’
“For any organisations going from price, to cost, to value- it is about talent development, investing in your teams…. without the right mindset, and the right people in the right places you are not going to get there.” Miguel Gonzalez, CPO Dupont
A number of speakers identified the benefits of flexible and hybrid working environments, such as access to a larger talent pool and improved work-life balance for employees, but there was also a recognition that managing these environments are tricky. Areas of concern emerged around cybersecurity, tax implications, a lack of training around coordinating virtual teams and dealing with social isolation. Regardless of these challenges however there was a recognition that not only is workplace flexibility set to continue for most but that for many it had become an important factor in onboarding and retaining talent.
“The hybrid model is becoming a standardised model that we are going to continue to see post-Covid”. Todd Buchholz, former White House Director for Economic Policy
To return to Adam Weisswasser’s ‘inflection point’, an aspect which appeared in almost all presentations was a huge pressure on procurement staff to develop greater business acumen. The transition to a strategic business partner requires a fundamentally different way of working with stakeholders.
Manuel Villarreal, Head of Category Management at Vanguard spoke passionately about restructuring teams to dedicate greater time to business partnerships, reframing procurement activities around stakeholder challenges and speaking the language of the business. Contextualising this need with the communications shift caused by hybrid working will be at the forefront of procurement executive concerns in the coming years.
BUILDING FROM THE DIGITAL ‘BACKBONE’
The phrase digital backbone appeared in the compelling interview with AJ Rohan, Associate Director of GEP, on the morning of the first day, in the context of procurement functions building on their system foundations and exploring new technologies. It was the first of a number of presentations that touched upon how procurement system strategies are evolving.
Procurement system strategies have traditionally focused on the S2P process, with the emphasis being on the visibility and efficiency of transactions. As procurement functions have shifted, at some pace within the last 18 months, to a role more closely aligned with strategic enterprise initiatives, procurement digital roadmaps are increasingly having to address how to support such initiatives; including those around risk management, sustainability and innovation.
This is not to say that digital roadmaps are disregarding the value of core procurement modules. Targeting these more strategic initiatives requires a strong data foundation and a high degree of supplier visibility. The refrain which came out of these presentations was that procurement functions increasingly have a broader horizon in what they are attempting to achieve with technology. Unsurprisingly these presentations also indicated this would have an impact on procurement digital partnerships;
“There is no tool right now which will give you everything you need for the end-to-end supply chain. You have to create a set of ecosystem partners who are all contributing” Rob Fuhrmann, Managing Director, Accenture
WINNING FOR THE BUSINESS, NOT PROCUREMENT
In its increasingly elevated position, procurement is having to reposition not just how it measures its value to the organisation but how it aligns its capabilities. The congress demonstrated a clear transition with functions looking to deliver diverse business value and consequently redeploying their internal resources around these objectives.
David Rae, Chief Product Officer at Procurement Leaders ran through the results of a recent Procurement Leaders’ survey of Chief Procurement Officers, highlighting the prioritisation of a number of strategic enterprise topics, such as ESG & sustainability where almost 80% of CPOs responded that ESG has moved ‘quickly up the list of priorities’.
The presentations we saw over the first two days suggest that for many procurement functions, this change in prioritisation was being addressed through establishing new roles; particularly for third-party risk and sustainability. Charles Miceli, CSCO at University of Vermont Health Network made a particularly strong case for bringing specialist roles around supply chain resiliency.
An aligned consideration was how procurement should measure its impact. A major push throughout the event was more multi-faceted decision making, with a recognition that doing so required data and insight which extends beyond purchasing data;
“Organisations should be thinking about total impact, if we are investing in sustainability with cost as a trade-off, that might increase sales or customer loyalty” Vishal Patel, VP Product Marketing, Ivalua