Procurement Leadership is Needed for the New Era of Disruption Ahead
I recently spoke at the National Contract Management Association on the subject of human capital in supply chains, and the need for building leadership skills in our procurement and supply chain professionals. This subject has become of critical importance in discussions I’ve had with supply chain executives.
Over the last two years, the need for leadership skills in procurement and supply chain has become more apparent than ever, as a result of the massive disruptions and shortages we face in almost every industry. This is particularly important for our public sector, in which billions of dollars in third party acquisition of products and services occurs on a daily basis, yet which often occurs by individuals who lack the strong leadership skills needed to build category strategies and engage with stakeholders and suppliers. These findings are supported by a GAO Report, “FEDERAL CONTRACTING: Senior Leaders Should Use Leading Companies’ Key Practices to Improve Performance”. They note that “Each year, federal agencies spend over $500 billion to buy a wide variety of products and services, ranging from cutting-edge military aircraft to common office supplies. Given the amount of federal funds spent and the missions these contracts support, it is critical that agencies’ procurement leaders manage their organizations effectively. However, GAO found procurement leaders at six of the federal government’s largest agencies did not consistently use key practices that leading companies use to improve the performance of their procurement organizations.”
The study finds that that successful companies:
- link performance metrics to broader strategic goals
- work with those using the products and services to develop these metrics
- use outcome-oriented metrics, like timeliness and quality.
The report encourages public sector contract officers and acquisition personnel to learn alongside private sector executives, and to think about adapting many of the acquisition tools and strategies advocated in the private sector.
We have designed a procurement leadership program that is designed to do exactly this! The time has come to admit that our leadership skills are not where they need to be within our procurement ranks, both in the public AND the private sector. Too often, procurement is focused on bidding and price negotiations (Lowest Price Technically Acceptable), without considering the new forces of change: supply chain resilience to disruption, diversity and inclusion in the supply base and the work force, our supply chain sustainability footprint, and the digital transformation of work. And while the concern over the shortfalls in the procurement field in these areas has been widespread, I have unfortunately not seen many signs of discernible actions. As a result, many companies are at risk for falling behind due to an inability to compete in the digital age and fulfill the expectations of organizations for leadership in these areas.
For this reason, I have teamed up with my peers to design a program that addresses this problem with an aim to equip procurement leaders with the resources needed to initiate much-needed change. More importantly, this program will provide “high potential” procurement executives with an actionable personal development plan to improve their communications and change management skills. Our twenty years of work with SCRC partner companies has led us to understand the core elements of change required to drive procurement transformation in response to the leadership challenges facing executives today.
As the author of The Living Supply Chain and leading supply chain textbooks, as well as the many years of consulting projects I’ve worked on, I recognize the critical juncture we are at in the evolution supply chains. The tools we’ve developed this program are necessary to adapt and thrive in the new digital age and to consider the challenges of shortages/disruptions that we face every day.
Over an entire week, we have pulled together a stellar group of senior procurement and supply chain executives from the private sector, who will provide insights and learning from their combined hundreds of years of experience. Further, each candidate will be personally coached on their organization’s change initiative, and how to more effectively communicate with stakeholders the value of change and how to influence them to change.
Through this program, delegates will:
- Explore what procurement and supply chain management will look like in the digital age
- Learn the essentials for delivering procurement changes that have a lasting organizational impact
- Learn to identify, manage, and overcome the barriers threatening the successful implementation of their procurement projects that require on-boarding of stakeholders for change