[Editor’s Note: Today’s article is a guest post from Market Dojo, a technology company offering Software as a Service built by procurement professionals, for procurement professionals. Its solutions enable procurement to overcome the challenges they face through managing data, mitigating risk, and minimizing costs. If you or someone you know would like to make a guest contribution, please contact us at editor at cporising dot com. Thanks!]
The New Rules of Procurement Engagement
The old rules for procurement are dead.
A new breed of procurement professionals is rising. From start-up procurement administrators to enterprise CPOs, these changemakers are on a mission to transform risk into opportunity, data into actionable insights, silos into seamless collaboration, and outdated process and misaligned tech into automated, high-performance best-of-breed solutions.
Change is inevitable, it’s time to rapidly evolve the once-undervalued procurement team of yesterday from a fragmented, reactive back-office function to a collaborative, strategic, and high-profile enterprise resource for tomorrow.
Light Despite the Dark
As global economies, enterprises, and business leaders leap from one mega crisis to the next, the focus on continual growth seems out of sight. As a response, organizations pivot their attention to cost control, risk mitigation, supply chain resilience, and digital transformation. The focus to drive greater efficiencies, control risk, and generate profitability from within is now business critical.
Seismic changes in the economy, political instability, rising costs, and inflation strike fear in many, yet others seek opportunity from chaos.
The role of procurement has never held more corporate currency. For many years, procurement professionals have been actively seeking strategic influence, and access to the right people, data, tools, and talent to drive true value and improve operational efficiencies.
Now is procurement’s time to shine! Whether you’re a seasoned professional or just starting out, this is your moment. But how?
The Changemakers
It is a new generation of digital natives with an expectation of consumerized business technology, actionable insights, and decision-ready data. When combined with the old guard’s growing frustrations for influence and smarter ways of working, we are seeing the emergence of a new paradigm of changemakers.
These changemakers will not stand for outdated ways of working, paper-based systems, fragmented data, unmanaged risk, and legacy “one size fits all” technology. The old rules are dead.
With the advancements in best-of-breed tech, automation, and new ways of working, the expectation of value creation becomes the new normal. The bar has been raised.
From start-up procurement administrators to enterprise CPOs, the new breed is transforming:
- Risk into opportunity
- Data into actionable insights
- Silos into seamless collaboration
- Outdated process and misaligned tech into automated, high-performance best-of-breed solutions.
Yes, change is inevitable. And now is the time for procurement to take the reins and become the changemakers who elevate the function to a new strategic level where its value is recognized and pursued as part of the normal course of business. Compare the procurement paradigm shift between yesterday’s Old World and today’s New World requirements.
The New Rules
With this paradigm shift upon us, only the strongest teams will survive — some will fall, and some will thrive. The question is where will you stand when the dust settles? How can you capitalize on this unprecedented opportunity?
The changemakers are embracing a new dawn as they explore the new rules of procurement engagement:
- Rule 1: Reimagine strategy to challenge the past to define the future.
- Rule 2: Reevaluate sourcing to transform market access and performance.
- Rule 3: Reshape supplier relationships to connect experiences and insight.
- Rule 4: Refine value creation to revolutionize continual innovation.
Let’s delve into the first of these rules.
Rule 1: Reimagine Strategy
It’s time to think big, assess the needs and values of your organization, understand past data, challenge preconceptions, and break down silos.
The procurement changemakers are exploring ways to reimagine strategic sourcing and spend analysis to understand where the real opportunity lies while using category management and pipeline analysis to identify short-, medium- and long-term wins.
There must be an understanding of both micro and macro, and internal and external forces that will elevate the vision of the procurement function and allow it to lead from the front.
A clearly defined strategy enables procurement leaders and teams to align and respond proactively to company strategy and elevate their strategic influence and help shape the vision and roadmap to sustainable business growth.
Measurable benefits of a procurement strategy include the ability to:
- Drive greater savings
- Understand true total cost of ownership (TCO) and lifetime value of goods and services
- Streamline data and processes
- Manage and mitigate risk successfully
- Provide business continuity and resilience.
The previous shackles of poor technology, legacy systems, low adoption, and limited influence have been removed.
By leveraging the right people, processes, and technology, procurement can create a path to drive better adoption and internal and external collaboration, empowering modern organizations to thrive against a volatile competitive backdrop. All the while, evolving this previously under-appreciated and undernourished function into a high-value strategic resource.
Join the Changemakers
To learn more about the New Rules, join analysts, procurement practitioners, and industry thought leaders as they grapple with a world of constant change to share their insights and actionable strategies to decipher the new rules of procurement engagement. This is your opportunity to join the evolution … join the movement at marketdojo.com/new-rules.
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