What is the Role: Chief Procurement Officer?
What is a Chief Procurement Officer?
Procurement has become more strategic in the last decade. The Chief Procurement Officer (CPO) is responsible for ensuring that the company's procurement strategy is aligned with other departments and creates value in this way. The CPO can also help make a more transparent process by explaining how each department can benefit from procurement activities. The CPO is the champion for Procurement and the impact it can have on the Business.Â
Procurement is no longer about cost-cutting or buying
In the last decade, Procurement has become more strategic. It's no longer just about buying things and cutting costs. Procurement ensures that the correct items are purchased at the right price and most efficiently at a basic level. But it becomes more extensive than this. In Procurement, we care about the following:
Supply Chain Risk Management
Internal collaboration with your colleagues
Continuous Improvement on Processes and Governance
Sustainable Cost Reduction Programmes
.Because of this, procurement professionals must understand how their department operates as part of a larger business strategy. Without this alignment with the Business, the Procurement Team will be lost. And the Chief Procurement Office is there to help pull this alignment together and drive the Business forwards.
The Role of the Chief Procurement Officer (CPO)
A CPO is the head of Procurement and is responsible for the procurement function. A Chief Procurement Officer (CPO) is a high-level executive responsible for overseeing an organisation's entire procurement process. They have strategic influence throughout the organisation, working closely with other C-suite members to help guide decisions on how to best use their resources to meet business objectives while also ensuring that they comply with regulations at all times.
CPO Skills & Duties
The CPO is responsible for creating a plan for the procurement function. They also keep an eye on the entire process of getting products, services, and supplies to fulfil your organisation's needs. That means ensuring you have a good strategy for purchasing goods/services with the following:
The total cost of ownership in mind
Improving the efficiency of your current processes
Reducing risk when it comes to managing supply chains
Managing supplier relationships
Advisory Role
The CPO's role is to advise the C-suite and other senior executives on matters relating to Procurement.
In doing so, they may advise on strategic sourcing, cost reduction, global sourcing and supplier management. They will also develop and implement policies to ensure that the strategy delivers on its promises.Â
Team Management and Alignment
As a CPO, you are responsible for developing and executing the strategic vision of your organisation's procurement function. This includes building and aligning teams that can accomplish this vision. In your role as a leader within an organisation, you're also responsible for managing relationships with your stakeholders. These stakeholders will have stakes in your success (e.g., line-of-business leaders, tech leaders, the CEO, and CFO).
The role of the CPO is to help every department come together and achieve a common goal.
As the CPO, you are a strategic leader who aligns and drives the organisation's supply chain strategy. You are also a business partner to other departments, ensuring that your department is aligned with corporate goals. In addition to helping other teams thrive, as the CPO, you must be an effective team builder within your own team. Finally, you will play an active role in driving change throughout the organisation by challenging long-held assumptions that may stand in the way of achieving your supply chain objectives. For example, that Procurement is a blocker and gets in the way.
How much does a Chief Procurement Officer earn?
Chief Procurement Salary in the UK
In the UK, Glassdoor indicates an average salary of around £100,000. However, from personal insights, I know this can easily be doubled and go beyond the £200,000 range.Â
Chief Procurement Salary in the USA
In the US, a median salary is around $214,000. There is flexibility either way, which is comparable with the UK salary.Â
Final Thoughts on the role of CPO
A CPO is at the very top of the Procurement career path. Few get there - it takes a powerful skill set to be considered for such a role. But if this resonates with you, do all you can to achieve this role in your career.
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