Editor’s Note: To celebrate our first anniversary, we are sharing a few of our favorites from year one. This article kicked it all off…. We think it holds true today.
When business historians reflect on the first decade of the new millennium, the broad-based transformation that occurred within the average enterprise’s procurement department will be on the list of top trends and highlights.
At the start of the decade (and millennium), the B2B revolution was in full effect, with billions of dollars invested in the development of solutions that advanced the procurement function and millions, if not billions more, invested in educating business executives on the value that a high-performing procurement department could bring to the enterprise. One by-product of these investments was the establishment of the role of CPO or Chief Procurement Officer within many organizations. The creation of this procurement leadership role with C-level stature and C-level access has been a validation of the impact that procurement departments can have on the enterprise and an indication of the increasing importance now placed on the function. The fact that a CPO does not yet exist within all enterprises tells us that the case for transformation must continue. It also indicates the extraordinary opportunity that exists today for many enterprises.
As exciting as it has been, the procurement transformation of the last decade was really more of an evolution than a revolution, a continuation of more than a century of advances in the development of the function. The discussion and understanding of procurement has also evolved. In the last decade, The CPO’s Agenda emerged to highlight the strategic nature of the procurement function and its leader, building as it did upon a discussion introduced in the Harvard Business Review 25 years earlier. But when Peter Kraljic screamed that ‘purchasing must become supply management,’ [link to actual article] echoes of Marshall Kirkman (author of the first business book focused solely on procurement in 1887) could be heard. The CPO Rising website aspires to continue the tradition and quality of earlier discussions and we welcome your voice.
In the months, years, and decades ahead, one thing is clear: supply management’s evolution will accelerate, as will its impact on business processes, business relationships, and business results. The CPOs and other leaders at the helm will face daunting challenges, execute exciting strategies and blaze new trails as they continue this larger discussion in their own ways. The CPO will continue to rise: what’s past is prologue!
Congratulations on an exciting and informative new year! Wishing you continued success in 2011.