So what else does it take to be part of the new breed of procurement talent? In part one of “Designing a New Breed of Procurement Professional,” we discussed how traditionally “qualified” candidates aren’t filling the needs of the modern procurement organization and touched on what new skills will make an impact.
Moving from data to business growth
Critical skills that modern procurement talent will possess are raw analytical capability and overall business acumen. A basic need for financial analysis may be obvious, but today’s procurement stars are able to:
- Look beyond price comparisons to meaningful analysis of total cost of ownership,
- Optimize a range of potential solutions as they relate to the value levers for various functional departments, and ultimately…
- Find opportunities to help the business grow its revenue.
Tech savvy and prepared for digital transformation
Achieving these results won’t happen in Excel. To quote James Patounas of Source One, “From a spend analytics standpoint, I don’t believe that I have ever seen a spend dataset that didn’t essentially cause Excel to die.” With no shortage of data or tools with which to analyze it, up-and-coming procurement talent needs to be more than just “Excel Wizards.”
Quantitative skills coupled with the ability to adopt and leverage business intelligence and visualization tools are vital. Especially as the analytical challenges stretch well beyond comparing bids or evaluating usage reports, we must be able to use new tools to find the real opportunities for continuing to add value across most categories.
Going back to the sales-minded quality mentioned in part 1, the ability to consume data and draw logical conclusions means little without the skill of effectively presenting the results in a way others can understand.
With procurement ROI flatlining (The Hackett Group’s June 2017 study says “cost reductions and savings are forecasted to level out in coming years”), the most successful procurement talent will find solutions that not only help their own organization succeed, but that also deliver value to the supply partner.
In the area of sourcing and negotiating, buyers and sellers are recognizing that they cannot continue to squeeze double digit percentages out of prices. And they are realizing that the churn of relationships in pursuit of this is fool’s gold. In order to find meaningful value that can be sustained, both sides must engage in more collaborative approaches. They must participate in more information sharing rather than adversarial zero-sum games.
The new breed of procurement professional cannot begin and end with sourcing activity and contract re-engagement. At our recent SYNERGY conference, Christopher Sawchuk of The Hackett Group commented, “In the next few years, the importance of price reduction will decrease while value management, demand management and TCO reduction become essential.”
A focus on supplier relationship management is vital to the sustained value and risk management associated with our efforts. This is where we will increasingly see the focus of our function and thus the characteristics of our next wave of talent.
Procurement is evolving; are Your job postings?
Procurement is evolving as a business partner. It is no longer an insular group trying to stake its claim to savings numbers, and it’s certainly not just a processor of transactions. The role of procurement departments is shifting to become a more valuable long-term partner of the business, enabling other functions to focus on their core competencies while optimizing the involvement of outside parties in the advancement of our goals.
We can’t afford to continue to hire for the same old qualifications. The next time you get the okay for a new hire, design your job posting to reflect these modern procurement skills.
Editor's Note: This post was originally published in March 2014 and has been updated for accuracy and comprehensiveness.