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Articles in category: Leadership
Developing and exhibiting an accomplished range of inter-personal skills has always been one of the key requirements of a leader, particularly so if you are a Chief Procurement Officer (CPO).(Read Full Article)
Procurement’s numbers have to make sense to finance, otherwise it’s hard to make an argument about adding value.
In the never-ending and always-necessary conversation about aligning procurement goals with corporate goals we almost always talk about what procurement should do to get closer to finance, which is arguably the first among equals in any organization. There’s a case to be made that procurement is where the money is.
The function’s first task in aligning with finance is to learn finance’s language and be able to speak with confidence about earnings per share (EPS), return on ...
Procurement processes have stayed the same for years (or even decades, in some cases) because change is hard, especially when it involves new technology, leadership or training.
As part of The Financial CPO campaign, focusing on procurement’s ability to develop and deliver to financial metrics, Procurement Leaders invites BravoSolution’s Mickey North Rizza to look at the barriers that can stand in the way of a successful procurement transformation.
The former chief of the FBI Crisis Negotiation Unit talks to Procurement Leaders about the right approach to negotiating and what procurement teams might learn.
Gary Noesner, former chief of the FBI Crisis Negotiation Unit speaks to Procurement Leaders ahead of his speaker slot at the Americas Congress on March 5-6 in Miami, Florida. His book, Stalling For Time: My Life As An FBI Hostage Negotiator looks at stories from his time as a hostage negotiator, instructor and investigator.
In 1981, Peter Drucker delivered a lecture at New York University titled “Managing the Increasing Complexity of Large Organizations.” Drawing on lessons from the auto industry, banking and beyond, he offered provocative prescriptions for coping in a world in which “the real challenge is to decide what you are doing” in the face of tremendous “technological change or market change.”(Read Full Article)
A study carried out by Wax Digital found the average age at which a buyer became a CPO at FTSE 350 companies was 42, but some had reached the position seven years earlier. The oldest to reach the position was 53, while the average age of all CPOs was 46, compared to the average age of 58 of a general FTSE 350 director.
The research, involving telephone interviews and LinkedIn profile analysis of 138 CPOs, found buyers had spent an average of three years in each of their previous roles, “suggesting the traditional image of procurement people in the same ...(Read Full Article)
So what are the ‘global themes’ of procurement fraud?
- No clear definition of procurement
The reason a central definition is so important is because it identifies the different areas of the procurement cycle that may be exposed to the risk of collusion or manipulation. The first stage is ‘identification of needs’, for example is there a requirement for this product or service in the first place?
- Lack of board importance
Procurement fraud is not on the boardroom agenda and there is often no anti-fraud strategy in procurement initiated across the organisation.(Read Full Article)
Here’s a suggestion for any CPO trying to figure out how to lure bright young new talent into his or her organization: Emphasize the importance of, and the opportunity to use, technology.
It was technology in the form of spend analysis, reverse auctions, and other applications that helped revolutionize procurement and put it on the path to being a strategic function rather than a mere back-office bureaucracy. And, it’s technology that will be a principal enabler for the functions to prove its value and deliver value to the organization in the years ahead. Where does that fit in ...
In the first presentation in the Procurement Forum in Zurich, Wolfgang Rauch, CPO of Novartis Pharma explained how his organisation sought to provide more value to the business. “Procurement is the best networked function in any industry,” Rauch maintained. “So the question is: how do we position ourselves to leverage that network?”
Novatis Pharma has launched a programme to push the function to the next level of performance and drive savings and productivity enhancements. The key to this is managing internal business requirements and managing the supply chains to service these needs.
Deciding what projects to tackle, and when to tackle them, will always feature as a daily task for most of us. We all have a variety of jobs to perform with goals to achieve, and each job will have its own timescale and deadline. This is why it is important for each of us to develop the ability to prioritise. In essence, this is the ability to focus on what is important and then to manage the task effectively in the face of the demands on our time that inevitably crop up every day.(Read Full Article)
How do we drive genuine engagement with the business? PwC’s Remko van Hoek explains why this is a maturity dimension that is missing in a lot of models and frameworks.
Just last week I contributed to an annual conference of fleet managers in the UK. I was asked to talk about how fleet managers can get more value out of suppliers and how they could work with procurement better to achieve that. Having engaged with fleet departments in all of my procurement roles so far, I was happy to contribute because it always feels like one of those departments ...
Contract management sometimes gets short shrift in discussions of where procurement adds value. It’s assumed by many in an organization - including, unfortunately, some in the procurement function - that reducing to writing the results of a negotiation on pricing, terms, conditions, product or service delivery, and other details is enough, that once officially encapsulated in a formal contract document all details are settled and things will proceed from there smoothly.
For procurement, delivering innovation is route to greater value and recognition. But what are we really talking about when you get past the buzzword?
In procurement, we all love to talk about innovation. It’s sexy and enticing because everyone wants to be the next Steve Jobs and because it improves the perception of value in the function. The problem is, the word has been used so liberally that its meaning is beginning to be diluted.
A survey of 750 senior supply chain professionals by SCM World, found they are facing five major issues. Kevin O’Marah, chief content officer at SCM World and co-author of the report, said: “Supply chain needs to catch up to the bigger role we have claimed for ourselves in recent years. Unfortunately, we still seem to struggle with developing the skill sets required among our teams.
“Too little systematic talent development and too hazy a measurement system may be confounding our efforts and investments at exactly the time they are needed most.” The five issues cited by The Chief Supply ...(Read Full Article)
Financial reporting, or lack thereof, is frequently a huge barrier to gaining credibility from stakeholders. A different mindset may be required to turn that around. Deutsche Bank’s VP global sourcing Justin Pennington explores how procurement functions can shape and improve much needed credibility across their wider organisations.
In one of my earlier roles, it was once said to me that one of the systemic reasons as to why the group had not been successful in the past, was down to the fact that no one "understands or supports" what the team had delivered. By most people’s vantage point ...
Most people believe that direct categories are more important, but procurement is directing a lot of resources towards managing indirects. Is this a good use of resources? I read with interest this morning on Paul Teague’s recent blog. In it, he looks at the way CPOs can build credibility in the business through concerted stakeholder management. In it, he argues, empathy is a key trait for buyers to secure success. But I wonder: is this a good use of company resources?
In Procurement Leaders’ 2014 Category Planning Guide, we asked buyers as to their stakeholder preferences. These are the ...
As the purchasing function evolves, procurement chiefs are increasingly being asked what else they can offer the business beyond cost savings. Procurement outsourcing and consultancy company Optimum Procurement held a roundtable discussion that considered the issue of value and whether we are on the brink of seeing the function deliver this, particularly in the areas of innovation, risk and sustainability.
The pressure is on purchasing functions after delivering increasingly tough savings targets through some of the most challenging trading conditions in living memory. Business leaders have seen these achievements and want more, more innovation, less risk, a deeper understanding of ...
There’s a difference between what internal customers want and what you might think they want, HP’s Nick Gunn tells Forum attendees.Thinking like a business person is advice procurement executives get - and give - regularly. It is essential to do that to create value and elevate procurement.
Nick Gunn, senior vice president of global procurement at Hewlett-Packard, brought that advice to life at Procurement Leaders’ Boston Forum on transformation Wednesday. He said that thinking like a business meant putting customers - procurement’s internal customers - first. He said that HP, like many companies, “have a big engine focused on suppliers
Buyers hoping to make it to the top table in their organisation would be well advised to spend time in another discipline, according to experts. A Seat At The Top Table , a report from outsourcing firm Xchanging, outlined the steps purchasing professionals need to take to make it into the boardroom, including broadening their business outlook and not wearing “procurement blinkers”.Ed Cross, executive director of procurement at Xchanging, who co-authored the report with consultant Peter Smith, said the most important skills to master were the board-level behaviour of listening, analysis and making considered points. - See more at: http://www ...(Read Full Article)
The development community's narrow focus on top-down innovation is obscuring the importance of other areas - such as user-led innovation - as useful inputs to the innovation process, says a leader of the UN Development Programme's innovation team.
The community must move away from its 'one-size-fits-all' approach to innovation and create a varied tool kit to adapt programmes to complex individual situations, says Giulio Quaggiotto, who leads the UN Development Programme (UNDP) Knowledge and Innovation team at the Europe and Central Asia office.(Read Full Article)
Consuming research is one thing, the real skill is to understand how it impacts procurement and your business.
Among the common traits of CPOs is that they are voracious consumers of statistics and research. They have to be in order to keep abreast of new developments and trends that may affect the way they do their jobs. The more research the better, not only for the knowledge it imparts but also because it can provide early warning of changes in the economy.
Many of us know people who have reached a certain point in their careers because they have excellent technical skills but they don’t get along with team members because their people skills are sorely lacking.(Read Full Article)
Managing transformation is a vital part of the procurement chief’s skillset, and a promising topic for discussion.
Never underestimate the power of a word, like "Yes" or "No". Depending on the context, those one-syllable words can bring about "change," another powerful word that reflects a major movement that can dynamically alter a business. Change is good, many people say, and they are right..
But sometimes, in business, to simply change is not enough. A mere shifting of direction or re-ordering of priorities won’t get you where you need to be to succeed. Instead, you need a total re-focus ...