Fridays (in 2023) means that it’s time for another CPO Rising Listicle. Each list will include a variety of procurement tips, trends, insights, research, lists, strategies, and/or recommendations designed to help procurement teams improve operations. We’ll also include a summary graphic for you to share with your team.
As we reported in the world premiere webinar of our annual CPO Rising 2023 report, Chief Procurement Officers began 2023 shrouded in uncertainty. Here are five strategies to help them manage it better.
Five CPO Strategies to Help Manage Uncertainty
The perpetual state of uncertainty for procurement leaders that began with the global pandemic three years ago continues today. Chief Procurement Officers face steep uncertainty in 2023, and managing it effectively is crucial to achieving performance targets this year. Here are five strategies that CPOs can use to better manage uncertainty:
- Communicate effectively: Effective communication with procurement staff, executive leadership, business stakeholders, and suppliers can help to reduce uncertainty. The free flow of information can help keep everyone apprised of the latest decisions and stay on the same page. CPOs can and should share information about their plans and strategies, and provide regular updates on how the team is performing.
- Develop a flexible strategy: Organizational agility is critical to managing uncertainty. A flexible strategy allows procurement teams to adapt quickly to changing market conditions and business requirements. In concert with other executives, CPOs can identify potential threats and opportunities and develop contingency plans to address them.
- Manage budgets wisely: A strong budgetary position can help a CPO weather unexpected events. There are, however, certain strategies that can and should be used to maximize your team’s output. This can include spending early in the period to avoid corporate pullbacks.
- Get closer to the action: When uncertainty rises, CPOs should work to flatten their organizational hierarchy and get closer to the action. Getting more frequent updates on project status and results can help teams better pivot midstream as well as help ensure they are working on the most critical activities.
- Keep your eye on the ball: It can be hard to think about longer-term plans when you are bracing for near-term shocks. Nevertheless, in 2023, CPOs must manage near-term risks and challenges to the business but they must also continue making the larger and more impactful decisions that affect the long term.
Overall, managing uncertainty requires a combination of strategic planning, financial management, communication, innovation, and relationship building. By adopting these strategies, CPOs can navigate uncertainty and position their teams for long-term success.
RELATED RESEARCH
Procurement Big Trends – More Uncertainty
The Key Themes for the Modern CPO’s Agenda (Uncertainty)
How Procurement Can Lead Enterprises through Global Uncertainty, Risk, and Disruption
Procurement 2023: BIG Trends and Predictions (Inflation)
