Collectively Addressing Procurement’s Blind Spots
Education, brand and taking calculated risks – our executive-led panel rounded the Big Ideas Summit off by discussing procurement’s blind spots.
What a way to finish the day. The aim behind the Big Ideas Summit was to challenge our delegates, and create tangible outcomes for them to take back to their organisations. Our senior panel did just that with their discussion on procurement’s blind spots.
Ambition, Strategy and Delivering Value
Mark Roberts, Global Procurement Capabilities Director at AB InBev, started by stating that unless procurement has the vision and ambition, the boundaries that are imposed on it will be out of its hands. Procurement needs to be more than it is today – at AB InBev procurement is starting to consider socially responsible actions of their $25 billion spend.
Dapo Ajayi, CPO at AstraZeneca, argued that procurement truly does have the ability to influence across the enterprise. In the pharmaceutical industry for example, procurement can assist with the speed of clinical studies. The profession’s remit is much broader than just about saving money, it has got to get into conversations about procurement’s strategic role in the organisation.
Chris Browne, CPO at The World Bank, talked about his organisation’s work with world’s poorest countries. The goal of the World Bank is to end extreme poverty, but working in some of the most fragile countries in the world. Currently, the biggest procurement spend is on a $8 billion project to build a solar plant in Morocco.
Chris also talked about his experience working on the government procurement reform in New Zealand, and then subsequently at the NZ Earthquake Commission following 2 devastating earthquakes in Christchurch. The EQC sprang into action following the earthquakes, stopped procurement regulations so people could do what they needed to do, and worked solely on the basis of delivering value and a service to the people on the ground. A very different way to procure, but just highlighting what’s possible.
- What was your ‘ah ha’ moment from the day?
Dapo – Dapo said that the conversation around transparency has got her thinking about what else AZ could be doing in this area.
Mark – Mark also highlighted transparency. In the era of Wikileaks, people are just as interested in who are the greenest CPOs/CEOs. The other positive for Mark was in the use of the word ‘skunkworks’. The idea that procurement doesn’t need to look for empowerment to chase innovation, but just going and doing it.
Chris – Chris said that corruption is the single biggest issue facing procurement around the world. Linking back to IBM’s opening keynote, Chris highlighted the use cognitive technologies to look at the issue of beneficial ownership – who ultimately is benefitting from contracts being placed around the world.
For Chris, there was also the realisation that we are facing a new norm, in both procurement and society as a whole. Some of the things procurement professionals have taken for granted for past 20 years are likely to be eroded in next few years due to the advancements in technology.
- What are procurement’s blind spots?
Dapo – Dapo put this question out to her global procurement colleagues at AZ. She argued that maybe we are all playing it safe, that procurement professionals are stuck in our box, with too much focus on savings. The blind spot for procurement was in seeing that a change of mindset was needed in order to make procurement more comfortable about dealing with the wider business.
Mark – For Mark, the blind spot came back to the issue of talent. The profession has used the ‘traditional’ sources, but we need to go beyond that. The other blind spot for Mark was whether or not procurement had enough ambition. Professionals need to be looking at the wider ‘why’ picture, and why what they are doing will benefit the wider business.
Chris – For Chris, the blind spot was how procurement are dealing with organisational lawyers. At the World bank, the lawyers have been taken out of the decision making process, but there is still a blind spot on how procurement works with legal teams, particularly when taking a calculated risk.
- What do you think we can do as a collective to address issues?
Mark – This is a matter of education, education, education.
- Education of the bodies and media around the procurement organisation to give institutions and people a clear indication of what procurement stands for;
- Education of the potential talent pipeline, the people we want to bring into the function;
- Education of the people procurement already has, how to build on the competency level and what will be required next. Mark suggested that these skills would include relationship management, but also entrepreneurial spirit.
Dapo – Building on Mark’s comments, Dapo said that it was about brand, brand, brand. Addressing this can be helped by using social media, which provides a window into the profession. On social media, the procurement profession needs to create a platform that encourages people to tell the stories about great outcomes, rather than just talking about savings. Procurement has been traditionally poor at doing this, so we need a platform to help.
Chris – Chris highlighted that often procurement people are perceived as, and can be, a bit boring. As Dapo said, the profession needs to be talking about how we are making a broader contribution to the organisation, rather than just about procurement itself.
Gabe Perez – Our final comment came from the audience, and Gabe suggested the profession should draw a line in the sand, and look forward to where we want to go as a profession. People are seeing the value that procurement can offer, why it’s a great profession to work in.
According to Gabe, we should stop looking at what we know, and now look forward to what we are going to do in the future.
The session helped to bring to a close what was a fantastic event, filled with great ideas and thought leadership. However, as was commented on Twitter, we cannot afford to rest on our laurels – we need to put these ideas into practice, address procurement’s blind spots, and collectively drive real change in our organisations.
