This month as I was preparing to write my column for the newsletter, I started thinking about how hard a procurement professional’s role really is—the balancing act they play, the many competing agendas they juggle. I bounced the idea off Sarah Holliman, SIG’s VP of Marketing, who reminded me that she’d recently written a blog posting for one of our newer member companies, Allegis Group Services, on just this topic. I agree wholeheartedly with Sarah’s blog post and couldn’t have summed my thoughts up on the subject any better, so we are reposting it here. Enjoy.
Five Good Reasons Why Sourcing Professionals Deserve Your Respect
By Sarah Holliman, Vice President, Sourcing Interests Group
Let’s face it…not so long ago, being in procurement wasn’t seen as a very sexy occupation. Ok…I know some of you are chuckling thinking it’s still not that exciting, but I beg to differ. And I’ll give you five good reasons why you should give procurement and sourcing professionals more credibility and respect.
They are the unsung heroes of the recession and economic crisis. Since the beginning of the economic downturn, cost containment has become a key priority for organizations of all sizes. This means that the procurement group has increased its strategic position on the corporate totem pole. In many cases, the CPO is now not only at the Board Room table, but is actually an invited guest. Increasing revenues or decreasing costs…fundamentally, those are the two ways to positively impact your net income. In a time of recession, increasing revenues can be a challenge at best, so decreasing costs becomes the focus. Strategic sourcing, which frankly has always made sense to do…becomes a priority, and the procurement group drives that process.
They take the heat from every part of the company. Not only do CPOs and their groups have to answer to the CFO…but they have internal stakeholders across all areas of the company as well. A recent report (“The CPO in 2011: The Toughest Job in the Global 1000”) by HfS Research states that a CPO’s job is “not for the faint of heart”. This is most definitely true—CPOs are on speed dial from every internal department from accounting to product management to the office of the CEO. They are being asked to cut costs by one department…while being told that they can’t trim costs by another department that “requires” something specific for their product. One thing I know for sure—if procurement is brought into the conversation earlier in the process, decisions can be made with all information on the table and everyone gains. Speaking of which…
They use robust information to make decisions. Procurement execs use market intelligence in all their sourcing decisions. They are well-informed about the supply markets in which they are involved and provide compelling information to any negotiation. At a minimum, this includes costs, but it can also include finding innovative suppliers…or collaborating on product improvements including service and process.
Their job requires a skill set that is enviable. Not so long ago, I worked as a consultant. A few years in to it, I remember someone asking me why I had chosen business school vs. a graduate school that might prepare me for a specific career—like med school or law school—something I could be trained to start “doing” right away. So I started thinking about what I was learning as a consultant and realized that the skills I acquired—being able to think on my feet, enjoying the opportunity to speak in front of a crowd, managing a variety of different moving parts, analyzing complex data and learning to tell a compelling story from it—were things that I could take with me in ANY future career. The same can be said for people in procurement. The skills they have mastered are crucial and should be leveraged and appreciated. In their roles, they learn to manage complex supply chains…they master the art of negotiating on price and other intangible factors that contribute to the total value…and they generally own supplier relationships. Individually, each of these skills is useful for professional OR personal reasons, but collectively, these skills pack a powerful punch.
They are innovators. Have you looked around a Procurement Department lately? Any misconceptions that people in procurement are old, stodgy pencil-pushers need to be completely erased. At SIG (www.sig.org, an organization that provides best practice events, content and networking opportunities for sourcing and outsourcing professionals, primarily from Fortune 500/Global 500 companies), over the past four years, we’ve noticed a massive shift in the demographic of people representing their procurement, sourcing and outsourcing groups. Not only are these folks incredibly bright, but they are also choosing these careers out of college and actually training for them. The talent management pool is becoming bigger because this has become a career of choice. With that energy and passion, comes innovation. Nothing in procurement is “as it used to be.” If SIG members are at all representative of the market as a whole (which they most definitely are), then this group is one of the most collaborative and innovative in their organizations. They seek best practices…they share key learnings…and they implement new ideas with passion and determination. They are doers.
Before I started working at SIG, in all honesty, I didn’t get it—didn’t get why this space was so exciting…didn’t see what I see now. This is a dynamic, fast-changing area and the people in procurement represent the best and brightest. I’m drinking the Kool-Aid now. I get it. I have a deep respect for both the people in procurement and the very critical roles they play in their organizations and hope you will too.