🪦Traditional Procurement is DIEING

💡But the skills from this era are still needed

Hey Procurement Legend, welcome to World of Procurement, a newsletter about procurement, contract management, and supply chain focusing on the future and digital working methods. We’re here to ensure you’re armed with the knowledge to succeed in your career and not get lost as AI and tech seek to dominate.

I just took a week off Substack after posting for 58 weeks straight. I was feeling slightly burned-out and overwhelmed with this project. AND that sucked because I love this project. So I’m going back to basics with it after taking time to think about what I wanted from Substack.

I was falling into the routine of making google-esque content. The kind of content anyone and everyone with an ounce of knowledge could write and I hated that.

So welcome back to the unfiltered weekly content I’ll be producing.

And yes, in that time I watched Dune Part 2 and loved it. I’m also about the start the fourth Dune book this week (and may have got a cheeky Dune inspired tattoo for what has become one of my favourite stories of all time).

And I want to start with an observation I’ve had. Traditional procurement is in its end days. About bloody time as someone who has worked in the most traditional of environments and felt suffocated by it. I just couldn’t accept that was what procurement was or should be.

It had to be better.

Like the Avengers. They were okay on their own but united together they were so much more.

That’s how I felt. Procurement needed to join forces with the rest of the business and really get its act together.

I spent a long time trying to find places that thought like this. It was always the minority. Perhaps 2 out of 8 roles that I held.

By traditional procurement, I mean:

• Buying and purchasing

• Hammering your suppliers until they break

• Obsession over the “spreadsheet” that “tracks everything” (but tracks nothing)

• Acting like the spend police

• Demanding a seat at the table 🤮

• Complaining that you weren’t involved early on

• Pushing away the emergence of procurement tech and AI

People have realised that If they’re doing these they will be destined for extinction.

I’m not saying these aren’t needed in some capacity at times.

Focusing on cost and where money is being spent should be a priority for all procurement teams. However, how we do it needs to change. In the next 5-10 years, I see a world of procurement where all tail spend is outsourced to autonomous agents that will negotiate on your behalf. We’ve detailed this previously with the likes of Pactum.ai perhaps being the most newsworthy provider of such a solution.

These negotiations will likely be fairer, timelier, less about emotion, more about data and where both parties truly need to be.

I’m talking to people who are finally realising that storing your entire supply chain in an excel spreadsheet isn’t a good use of time nor does it prove to be a point of resilience for data integrity. You’re always playing catch up with this.

So, where are we going?

To a digital future - that’s obvious.

What does this truly mean though? Because I certainly don’t see it as a gold rush for new technical skills to be prioritised. In fact, I see this as a golden opportunity to prioritise the most basic of skills that, at times, we take for granted.

I listened to Nvidia CEO Jensen Huang, who, rather polarisingly, stated that for the last twenty or so years, every tech CEO and school councillor has said kids need to learn to code.

He doesn’t believe that.

Natural language, which we already speak, will become the coding language of the future, with AI taking on the responsibility of converting our needs into something tangible.

This will have huge implications for every profession.

And it seems to align with the intentions of what OpenAI and AI focused tech-soluitions are attempting to do. Put human language at the core of creating new experiences.

So, I see language, communication, conciseness, and the ability to command programmes and processes as the most important skills.

There’s more to it that just that but I feel like if you can combine this with the traditional skills such as spend management, procurement lifecycles, sourcing, performance management etc, you’ll be in an incredible place.

Steven Wolfram suggested this as Open AI’s Chat GPT product started to gain traction and his Wolfram language already focuses on this.

But here’s the caveat - you need to truly understand your discipline.

For some of you, that’s procurement.

Others it is supply chain & logistics.

Others it is contract management.

I’d suggest getting across all of these and becoming a true generalist.

But you need that foundation of knowledge to be able to convey what you truly mean. The tech of the very near future will enable you to manage your suppliers and contracts like never before.

We won’t need to hammer down on suppliers.

We won’t need to waste time on spreadsheets.

We won’t struggle to get the right data - we’ll need to understand data better than ever though.

We won’t struggle with compliance issues - but you’ll need to understand how to be compliant in the first place.

The opportunity to do procurement better than ever is here - it just requires you to take those first steps.