Success, for any Chief Procurement Officer (CPO) comes from consistently adding value and staying relevant. Greg Tennyson, SVP of Strategy and Procurement, of Fairmarkit said: “That means continually improving your knowledge and skills, lest opportunities pass you by. Yet this is often easier said than done.”
Balancing the day-to-day with plans for the future
Balancing the day-to-day with plans for the future can be challenging, “Sometimes it feels more important to simply concentrate on the minutiae and the day-to-day of procurement—hit the quarterly targets and budgets, review purchases for compliance, and write those RFPs. Never mind reading up on innovative new ways to manage tail spend, or reviewing the latest procurement portal,” added Tennyson.
But this can lead to a loss in insight into where the industry is going with a risk of being left behind in a fast-paced environment. Tennyson reflects on a comment from former Intel CEO Andy Grove who said: ”Only the paranoid survive.”
It’s vital for organisations to stay ahead and keep up to speed on new developments in the procurement field. “But it can be hard to take the first steps,” notes Tennyson. “The sheer scale of where to start can lead to intimidation, if not outright choice paralysis.”
Engaging with technology companies
Reflecting on his learnings over the years, Tennyson expressed the benefits of taking cold calls from technology salespeople and meeting with reps. “This might sound strange and a surefire way to eat into your valuable time—but hear me out!” he said.
Technology Sales reps, especially startups, can be a valuable source of information for CPOs, due to their new and interesting ideas for solving complex business challenges such as diversifying your supplier base, reducing maverick spend, centralising procurement data.
“If there is a problem facing Procurement, you can be sure one of these entrepreneurial companies are working on a solution, and I have always found the cold call meeting a great way to stay current on technology advancements, trends and best practices,” said Tennyson.
He added: “Don’t get me wrong, I’m not suggesting you suddenly say yes to every cold call request you get. But I would encourage you to take one or two more—especially if they’re in areas that could help your procurement team add value to your organisation.”
Now is the time to be proactive
When it comes to procurement, there has been a proven correlation between the health of the department and the corporate performance of an organisation. Tennyson stated: “According to McKinsey, stronger procurement leaders are able to find their company more savings, reductions in the cost of goods sold, and a higher average EBITA.”
Those that are considered to be ‘procurement followers’ will struggle to add anywhere near the value that proactive procurement leaders can. “McKinsey warns that when procurement professionals do not devote enough time and resources to adding value and instead concentrate on the short term, operational issues, they do not play a leading role in their organisation—in fact, they are undervalued,” he added.
Long term, forward-thinking
“For CPOs to shine, they need to think long term, be forward-thinking innovators,” commented Tennyson. For him, taking cold calls gave Tennyson the ability to transition from practitioner to industry leader.
He concluded his thoughts by saying: “Whatever it is you can do to shake yourself out of a do-nothing attitude or even to take yourself to the next level, do it now. Be open to being a better CPO. Be open to the art of the possible. In the end, you won’t be disappointed.”
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