Over the next decade, procurement will undergo a transformation. While buyers will need to reorient their skills around strategic vision and relational intelligence, procurement managers will also need to rethink their role and the skills required. Buyers are very clear about what they expect from their manager: hands-on support and recognition of the team’s achievements.
Being flexible about new ways of working
In recent years, various ways of working have become increasingly common within companies (teleworking, flex office, coworking, etc.). The health crisis, which led to various lockdowns and office closures, has drastically accelerated this phenomenon. Employees increasingly want to integrate these forms of flexibility into their daily lives because they see it as a way of saving travel time and achieving a better work-life balance. This is all the more true for the new generations who aspire to greater freedom.
The procurement manager will not only need to accept this change in work organisation but, above all, support it. Remote management requires strong communication skills, good interpersonal skills and adaptability to build a climate of trust within the team and to encourage individual and group efficiency.
Assessing overall procurement performance
Going forward, the procurement manager will have to put in place the right key performance indicators to assess the procurement department’s contribution to value creation. A recent Deloitte report explained that the most efficient and agile procurement departments generally monitor a greater number of KPIs. These include:
- Cost reduction and/or avoidance;
- Sustainability objectives;
- Risks and compliance (e.g. number and severity of incidents);
- Supplier performance (regarding deliveries, innovation, quality of service, etc.); ;
- Improvements in cash flow (e.g. working capital);
- Internal stakeholder satisfaction;
- Work efficiency (e.g. operating costs, downsizing, etc.);
- Capacity for innovation;
- Speed to market;
- Increase in revenues;
These results can be used to demonstrate the performance of procurement and its contribution to business development and value creation for the organisation. The procurement manager can thereby build recognition of the internal procurement department and increase its influence.
Harnessing digital tools
The day-to-day work of procurement teams will be transformed by the development of new technologies (Artificial Intelligence, Big Data, Blockchain, Robotic Process Automation, etc.). Like buyers, procurement managers will also have to upgrade their digital procurement skills. This involves not only the technical mastery of these tools but also the computational thinking to interact with these devices and the intellect to interpret the information accurately!
According to a recent Deloitte survey of procurement decision makers, more than half of all managers feel that they lack digital skills and 43% specifically cited the need for training in analytics.
Coaching your team members
Brice Malm, senior partner at Page Group, explains: “Teams are looking for a leader who is more like a coach. They must set a clear direction, support their teams, be with them on the ground, help them to ask themselves the right questions and to develop their potential.” In this sense, the procurement manager will have to listen to, motivate and reassure each member of the team to help them grow in their professional careers. This requires mastering a variety of techniques and tools, such as systems analysis, which involves looking at the relational context, rather than focusing on the individual. The procurement manager will also have to strengthen certain soft skills: communication, leadership, resilience, etc.
Managing by example
Within the company, exemplarity is based on three key notions:
- Transparency: giving your team members as much information as possible and being clear about your own activities, the use of your time and your added value;
- Humility: acknowledging your mistakes, setting targets for improvement and being challenged by your team members;
- Collective interest: being fair to your team and leaving no doubt that the collective interest takes precedence over the individual interests of its members.
While buyers want their procurement manager to lead by example, the manager must also embody the values of the procurement team to all stakeholders.
To sum up, the procurement manager will have to redirect their attention to the members of their team and the means to create a group dynamic. As a true ambassador of the procurement department, they will ensure that the added value of their entire team shines through.
To find out how to integrate CSR into your company’s procurement policy, download our white paper.