Years ago, when I first started trading commodities, I was told that great commodity traders closely followed both the 'science of trading' as well as the 'art of trading'. It took me a while to fully appreciate what this meant, and once I did I came to understand the difference and the value gained from mastering both. Science has always provided for me the means for foundation building, art has allowed me to think without limitation and to design for the unknown. This has helped me provide better insights and vision for the 'why' behind what I've done, and helped me make the 'how' and the 'what' more clear, and much easier to gain approval for.
With quite a few recent roles involved with transforming organizations, I've come to believe that excellence in transformation requires more than the science. I associate the approach to transformation as the determining factor in a transformation's success, and I've come to realize that we constrain ourselves if we think about transformation only as a disciplined, liner approach. In doing so I think we limit vision and insight into the future, and miss their value and importance for a successful transformational journey.
When you look up procurement transformation online you will find an array of linkages, mostly in terms of approaches, models, value contribution, and the like. For me, all linear descriptors and enablers lending very much for the case that the approach to procurement transformation is science in the practical sense. And as a science, we'd expect that transformation strategy plans will be objective, theoretical, hypothesis based and explainable. Sound familiar? In most cases this is exactly what we see today - linear approaches to procurement transformation frameworks within business cases, implementation plans, and even metrics. The problem is, we develop transformation in a linear progression using linear models and tools, yet rarely is the real journey a linear one.
It took me a while, but I concluded that I needed to stop looking at procurement transformation in such a linear way, simply because the world has become less linear and therefore, why look at it in any other way. It really hit home when I began to interface with more C-suite and senior stakeholders and what was top of mind for them - 'why', not 'how' or 'what', but 'why'. And the 'why' for me begs an answer which is not simply science, not simply linear, but something that is considerate of vision and is surrounded with insights that aren't necessarily linked to what we know today, or what we believe the logic to be tomorrow.
I was doing some work a few years ago, while modeling 'Procurement 2025' for a large global CPG company, and I had a conversation with a think tank economist who told me that "today's linear business model is shifting to a more inclusive, more secular model and the imperative is for you to think of it in no other way as you move forward with your work". He further told me that the future will require less compartmentalization and that I shouldn't "expect order to necessarily prevail". Less linear, secular, less compartmentalization, less order. His provocation brought clarity and a new perspective to my work, about what companies need to think about and what companies need to prepare for as they journey over the decade to come.
Procurement transformations today are coming in waves, not ripples, and the amount of change is being driven by the full complement - the laggards, the followers, and importantly the leaders. It doesn't really matter where you set today, it does matter though where you set tomorrow. And where you set tomorrow and the transformation to get there must be framed by the 'why', and the 'what' and the 'how' are simply enablers. This said, in sitting down with procurement leadership today as they contemplate tomorrow it still seems that the tendency is to focus on the 'what' and the 'how', the linear approach embedded with the science - "I can save this much money if I do this".
CPOs today, along with the consultants that they engage, are looking to transform all or parts of their procurement enterprise. Some are catching up, some are bolting on to solid foundations, and still others are advancing the curve. The business cases we are required to produce in order to access the resources we need from our companies cannot be solely linear based. The world today is complicated and it makes approaching transformation complicated. The digital world of tomorrow is guaranteed to be even more complicated and therefore what you plan today must be agile for tomorrow. So, I suggest in taking a more secular view of the world as the future may unfold and assume that your procurement journey will encounter change and disruption that is simply unknown today. I'm reminded of something Richard Dobbs said in his book No Ordinary Disruption, "The Industrial Revolution pales in comparison to today's convulsions...they challenge our imaginations as much as they do our competencies and skills...and managing is so difficult because of the second- and third- order effects". What we know today we won't need to know tomorrow, and what we should know today is that we will likely need something different tomorrow.
When approaching transformation today and the 'why' behind it, I have found that one of the easiest ways to organize my thinking is in terms of "shifts". In their book Beyond Performance: How Great Companies Build Ultimate Competitive Advantage, Scott Keller and Colin Price talk about companies sustaining success and managing change. They talk about the "health of organizations" and how important "mindset shifts" are for transformational success. They talk "mindset shifts" in a linear sense (in a to-from sort of way), and in a secular sense, that along the journey of transformation there will be one-off, sometimes disconnected, disruptions that require the agility for "mindset shifts" within the company. If transformation is approached solely against a linear path it will ignore the disruptions along the way (or at least not know how to deal with them) and the "big shifts" (as I call them) that companies will need to consider will be missed. When including an artful approach to transformation, consideration will be given to the type- "shifts" that will be required and the type- disruptions that are suspected - digital customer-to-consumer models, virtual reality (VR) and 3-D, Gen Alpha, and even digitizing thinking in the cloud. Including art with science, non- and linear thinking, will create a procurement transformation strategy plan with a higher probability for success.
The fortunate thing about approaching transformation in procurement is that it hasn't been going on for 200 years. We are still creating the "template", there is no magic pill. Sometimes there doesn't seem to be anyone who is "right" and sometimes it seems that no one is "wrong" and everyone seems to be talking the same language, the same things. But because there isn't a "template", the "True North" for procurement hasn't been established. And I believe we will find that the journey to "True North" will not have been a linear ride for any of us. We should consider in our transformation approach the type- disruptions that may occur whether linked or not, and the type- "shifts" warranted through the agile procurement transformation strategy we develop. The 'why' will not be deliberate or as easy as we will want. Whether we are one of those still building, or we are building from, or we are lucky enough to be on the fringe and ahead of the curve, the more we can treat our approach to procurement transformation as art and science, I think we'll be largely successful.