Do your network partners understand and support the evolving role of procurement?
As a network, we see that procurement is undergoing change, to play a growing role in the company’s ambitions.
No company has cost savings in their mission-vision statement. More likely, it’s focused on innovation and growth. And though profitability is important, no business ever saved its way to success and glory.
Hence, procurement is evolving to become an enabler of company growth. Do your agency partners realize this?
At the BlocPartners, we do. We appreciate that a new mission often requires transformational change, and procurement has a growing role in that. Here are 3 trends we recognize and how the BlocPartners can help.
Trend 1 – From Cost Cutting to Growth Enablers
More than 66% of Chief Procurement Officers (CPOs) are prioritizing supplier collaboration and other broader value-generating activities.
Collaboration with suppliers has always been important. With the changing landscape, procurement cannot afford to communicate with suppliers just over price – instead, there’s a focus on improving synergies with them. Suppliers are increasingly given visibility of all steps in the acquisition process, to help get the best price by clarifying the opportunity / risk. This transparency supports the need to feel empowered and promotes healthy competition between partners, benefiting the organization.
With empowerment comes the need for effective supplier evaluation – focused, smart, effective method for measuring, analyzing and improving business performance and thereby reducing costs, increasing efficiency, enhancing network relations.
https://hbr.org/sponsored/2022/01/procurement-teams-are-moving-fromcost-cutters-to-growth-enablers-2
Trend 2: Achieving Effective Change Management
80% of CPOs are investing in an updated operating model to meet new business needs, (only 13% report being satisfied with their current approach).
Procurement leaders often confirm change management as the biggest roadblocks in achieving defined goals. The application of tech means transactional work is becoming automated, leaving time and resource for more strategic activities. But change management is not easy, as it brings a sense of insecurity about the end result and so resistance to undertake new initiatives. Smooth change management requires regular communication with the employees to engage them through the process and provide adequate training / support.
https://hbr.org/topic/subject/change-management
Trend 3: Having a Digital Strategy
32% of executives have implemented a digital strategy, despite 85% of them believing that digital transformation is fundamental.
Many companies today fail to see the threats and opportunities that digital represents. With customers drawn to data-driven services and experiences, many fail to appreciate the growing value of data and digital ecosystems.
Most leaders realize that improving performance demands organizations have to take the leap from manual to digital transformation with an approved strategy. Procurement plays a key role in ensuring organization invest in the right infrastructure, processes, and resources with a vision that aligns with the organization’s long-term objectives.
https://hbr.org/2022/08/is-your-company-squandering-digital-opportunities
How Networks Can Help
Supporting this transition with procurement is a key part of a network’s responsibility / commitment to clients. That commitment should include:
Enabling Growth: For procurement teams at future-ready organizations your network should enable joint innovation programs, hacks and partnerships to boost revenue and resilience.
Effective Change: Networks need to provide category experts, who have specialized knowledge, insight, consultancy, and capabilities across key areas to help procurement achieve integrated business performance. Such category experts’ activities are pivotal to performance and should be proposed proactively
as well as on demand (encouraging more departments to engage with procurement).
Digital enablement: Networks need to provide an effective platform solution, working across the product life-cycle. By leveraging data at each stage of the platform, customer solutions target areas of optimal growth and deliver experiences built on behavioral science.
Ultimately, with the right network partner supporting a shift in the company’s operating model, procurement can help to realize the organization’s strategy, accelerating speed to market.
