Today, we continue our discussion of the State of the Chief Procurement Officer (Part one is here)
This article is based upon the research found in Ardent Partners’ annual CPO Rising report which is now available at the following sponsor links here, here, here, or here (registration required).
Since I began writing an annual CPO-focused report back in 2006, I have deliberately tried to maintain some level of cohesion and consistency across the distinct research efforts by asking some of the same questions each time. Doing so has helped to detect and define some of the larger procurement industry trends while also helping to chart the evolution of the procurement function over the years. At the same time, I also work to bring new and varied ideas into these reports by asking new questions each year too. Today’s discussion introduces a new question that builds upon a larger procurement trend.
Over the past five years, we have seen that Chief Procurement Officers have increasingly focused on collaboration with internal stakeholders and functional peers as a way to place more spend under management, gain greater influence, and better support business initiatives. Again this year, collaboration is a top CPO strategy with 43% of all CPOs focused on improving collaboration with the business. Truth be told, the collaboration trend in business is not unique to the CPO, but has been widely adopted – this is in no small part due to the geographic dispersion of teams, shorter job tenures, and the need to drive productivity.
Since collaboration has been a strategic focus for many CPOs, I thought it would be interesting to see how the CPOs (and their procurement departments) are viewed by other enterprise stakeholders when it comes to collaboration and general integration with the busines by asking this question:
What best describes the level of collaboration and integration that the procurement department has with functional partners, business stakeholders, and executives?
With almost 270 responses, we found that the CPO landscape is cut roughly into thirds where the leading procurement segment reports that its CPO is either a top collaborator (12%) or influencer (18%), a middle segment finds that its CPO is capable of delivering solid support (36%), and the lagging segment finds that its CPO is either reactive (30%) or siloed (4%)
So often we focus on highlighting the best practices of leading CPOs or procurement organizations when the stark reality is that not every CPO is positioned to take advantage of the newest strategies or latest technologies – not every CPO has a team that can effectively engage the business (i.e. collaborate). While some CPOs have truly “arrived” in the C-Suite and others are knocking on the door, just as many struggle for relevance, engagement, and traction within the enterprise today. The role of CPO remains a work in progress.
To get the full report, click here, here, here, or here (registration required).
