A memo from World Procurement Congress – act now, don’t wait

My colleague Andrew Daley and I attended the World Procurement Congress hosted by Procurement Leaders last Week.

It was an excellent event managing to mix some key themes that procurement needs to address now, such as sustainability and talent and significant long term trends including the impact of technology and how regionalism and nationalism affect the supply chain.

The message to me was ‘act now, don’t wait’, as in such uncertain and unpredictable times sitting and waiting may be the worst option and seriously risks your business getting left behind.

Robert Guest of the Economist gave a very broad ranging ‘state of the nation’ type speech on global trade and made some excellent points on the increasing regionalism of supply chain versus globalism and the impact of nationalism. He asked “what does this mean for Procurement people?” Well it risks the introduction of increasingly populist regulations or challenges on hiring, which means doing business could well become harder. So watch this space as this may be counterbalanced as digitisation and AI may make trading easier.

Sustainability is becoming a critical business driver and one that procurement has a leading role in. This point was made excellently by David Ingram, CPO of Unilever. It’s not good enough to just talk about it as sustainability is visible and measurable and must be checked and certified in the supply chain.

This was followed by an excellent discussion session with Imran Rasul, CPO at BAE Systems. Procurement people in his business have embraced the approach as they feel good about it. So no need for a mandate.

Two excellent but very distinct approaches in different markets.

Talent was another key theme from the conference. Future-proofing procurement’s capabilities featured in many of the keynotes and breakout sessions. Simon Geale of Proxima summed this up concisely as being two key issues of capability and capacity – simple if you think about it but very complex to solve?

Yes, there is a shortfall of people with specialist procurement knowledge, but more critical is finding those with good business and soft skills. Part of this discussion across the two days was also on diversity. We just had to look around the venue at the predominantly white, male audience to see this is a challenge procurement needs to address. Again real action needs to be taken now and words and presentations are not enough.

A number of discussions also touched on another key challenge for procurement, that of digitisation and the use of AI. Daniel Keyworth, CPO at Legal & General shared his vision for a 100% digital workflow by 2021 and I feel other organisations need to challenge themselves in this way too. He proposed five key pillars for procurement linked to digitisation:

  1. Enabling self service.
  2. Team organisational evolution.
  3. Better business partnering.
  4. Driving disruptive innovation.
  5. Easier to work with for our suppliers

Ultimately, the theme ‘procurement needs to be an enabler’ resonated, but with so much to do and with headcount tight it was felt organisations will need a flexible resource model with highly capable, well trained, multi skilled individuals who will adapt to the organisation’s needs.  

This was a red flag for me as whilst I agree, I did not hear how this was to be solved in terms of recruitment or development. If the bar is raised higher and the approach remains the same, we will get the identical end result: a lack of capable people internally and a lack of good people to recruit.

The end of the conference was a call to arms and Anita Sngupata, who is ex-Nasa really showed how we need to challenge our thinking through the example of how transport will change. If she is right our current supply chains will need to be completely re-modelled as there are some genuinely disruptive technologies coming – and soon.

Procurement Leaders event hosts Jet Antonio and Joe Agresta gave us three key takeaways to make happen:

  1. Build talent capability
  2. Drive innovation
  3. Sustainability

The challenge I think for procurement is to lead and educate their businesses about cost savings versus value and long term strategic goals. We see too many functions and organisations who are driven by short term cost or time-based metrics and a ‘penny pinching’ approach to any of these three could be a very short term result indeed.

But overall, do it now. Don’t wait.

Peter Brophy

Associate Director, Edbury Daley

peter@edburydaley.com