Procurement Leadership: Does Procurement need a “seat at the table”
The challenge with Procurement Leadership
I’ve been working in Procurement for 7 years and this one concept has frustrated me more than any other. The notion that Procurement needs at a seat at the table makes me want to vomit. It’s spewed out by people time and time again and it’s evidence of a real problem in Procurement.
I’ve been asked on LinkedIn, at events, and at work - how do we get representation at the very top.
I give the same answer every time but I first ask Do you know what that problem is with asking this question about Procurement? They will normally look at me with confusion or hit the response on the keyboard: “no?”.
I tell them. It’s ego. Ego of our profession that everything has to stem back to us not getting our way. Yet, if we got hyperfocussed on what truly matters in Procurement in 2022 we’d be in a far better position. Heck, we’d easily have a seat and and every ear at this table.
For anyone wandering what this table is - here you go.
What is the Table
The table is where the executives sit. Depending on the company size it may be heads of, directors, or the C-Suite. Most reference the table in light of the C-Suite.
C-Suite Roles
The table is usually made up of:
Chief Executive Officer
Chief People Office
Chief Operating Officer Chief Finance Officer
Chief Commercial Officer
Chief Technology Officer
and more, or less, depending on what your company does.
You’ll see I did not include the Chief Procurement Officer here.
Procurement is already represented at the Table
At most of these tables, you’re going to have the most senior finance professional, which is likely going to be the Chief Finance Officer. The CFO has a huge stake in the viability of Procurement. Not just from a cost cutting perspective. The CFO is often charged with the oversight of growth within the business. That means, the CFO needs procurement functioning to:
Prevent risks occurring in the supply chain that can disrupt your goods or services offering.
Find the best suppliers for ESG initiatives as this could give a real commercial edge to your product offering.
Build relationships with partners to make a unique offering as you work with your partners to innovate to give you a commercial edge in the market.
Not to mention you could add in the CCO and the COO who will all have a vested interest in procurement getting the attention it needs.
But I hear you.
You want the Chief Procurement Officer sat there.
And I agree - it would be awesome.
But are we going to get there if all we do is ask why we aren’t there at the moment?
No - but this is how we change this.
How to get the Chief Procurement Officer at the Table
Procurement must get hyper-focussed on doing its job.
And I don’t mean cost cutting and breaking suppliers. That isn’t the job. Only Procurement Dinosaurs think in this manner.
Procurement is no longer in place to purely cut costs.
The Hackett Group in their September 2022 Publication “Sizing Up the Procurement Digital World Class Advantage” highlighted that Procurement’s priorities are broadening to support value driving areas. I know I bang on about Procurement being a value generator and others do, and at times we give little background to this. I want to highlight these value driving areas more so moving forwards. The Hackett Group stated the 5 priorities are:
Reduce Risk to Ensure Supply Continuity
Reduce Spend Cost
Become a Strategic Business Advisor
For me, reducing cost is always going to be part of procurement but it will over the next 3 years, diminish in importance. It will become a by-product of the role. If you can create value adds in the supply chain, by building resilience and relationships, that hold up to macro-economic events, you could give your company a massive advantage over it’s competitors.
Scale that back and do that every day and your CEO and the wider table are going to take notice of Procurement. They’re going to want you to be part of the club.
You’re in.
Not by asking “Why not me?”.
But by delivering an incredible service within your business, by aligning to your business and by doing everything in your power to make use of the data, the insights and the opportunities you see. You just need a Procurement leader who embraces this and doesn’t cower behind the opportunity.
TL;DR
Don’t ask why Procurement doesn’t have a seat at the table
Get hyper-focussed on delivering value add work for your business
Earn the respect of your company by putting in the work
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