Today I’d like to welcome Charles Dominick of Next Level Purchasing with his post on Procurement Transformation.
Procurement transformation. It’s a buzzphrase. It’s a goal. And it’s a reality for some organizations.
But what does it take? What are the necessary ingredients to take a purchasing and supply management department from a state of being mired in the tactical to being a key driver of the strategic success of the organization?
Look at the marketing materials of vendors touting their ability to assist a procurement transformation. You’ll see software that will transform your organization. Consulting services that will transform your organization. Outsourcing services that will transform your organization.
And they all can – and, possibly, should – factor into a successful procurement transformation. But there is one constituency associated with a procurement transformation that doesn’t market to you. There are no glossy mailers. No full-page trade journal advertisements. And (thankfully) no spam.
Who is this constituency?
It is the personnel who fill the seats in your purchasing and supply management department. And they are arguably the most important ingredient that differentiates successful procurement transformations from those that only sounded good on paper.
For success and sustainability in a procurement transformation, you need a great team. You need people to establish synergy with your internal customers. You need people to develop continually improving relationships with suppliers. You need people who are aligned with the long-term goals of your organization.
Many purchasing and supply management leaders recognize this, but don’t always approach building their teams in the best way. Many of them think that having a team primed for procurement transformation simply means firing their current staff and bringing in “new blood.” I’ve seen this approach fail. And cost the organizations a lot of money in the process of failing. I’ve seen the poachers become the poached.
So, having the right talent for procurement transformation isn’t just about recruiting. It’s about three cornerstones:
- Talent Development
Talent development is first cornerstone and the topic for the rest of this post. Almost every purchasing and supply management leader will look at her own team and not be 100% satisfied. The grass is always greener on the other side of the fence.
But why is the grass always greener?
If Company A across town seems to have a more talented team, why is that? Was your organization’s recruiting that bad? Or could it be that Company A just focused more on developing their talent through the years? And if your talent development efforts paled in comparison, don’t blame your team members.
Purchasing and supply management is a rapidly changing field. Your team can’t do the same things day after day, year after year and expect to keep up. Your team needs exposure to what is going on outside of the four walls of your office.
The responsibility for the talent in your department lies squarely with you – the leader. So what exactly do you do to develop the talent for your procurement transformation? Here are a few ideas that you may find helpful, though these certainly do not exhaust all of the possibilities:
- Enroll your team in training.
Training is a great way to really get your team to focus on nothing but true learning. Have a clear picture of what you want your team to know or be able to do. Then find the training that is specifically designed to give you those results. Training should offer a step-by-step, how-to approach for teaching your team how to meet your goals.
- Share relevant trade journal articles, newsletters, and even blog posts with your team.
These types of media can help your team understand what is going on in the world. They will get to see how other organizations are going about achieving success in purchasing and supply management. They will be exposed to some great ideas and will eventually be able to separate real-world ideas from textbook theory.
- Coach your team.
You are the expert. Your team will only appear “dumb” if you think that they don’t know what you know. So impart your knowledge and your experience. Don’t withhold it. You will have a stronger team for it.
- Employ shadowing.
Sometimes one of your experts will be working on a challenging project. Think about having one of your more junior employees assist on the project. No, it is not the most efficient use of resources especially if you have a busy department. But will it pay long-term dividends when you have a more experienced team and less dependency on one specialist? You bet!
- Rotate your team.
One of the richest assignments in my career was when myself and three coworkers were in a two year program to switch positions every six months. Even though we were in the same company, each position taught me something new about purchasing and the organization. Job rotation can give your team new skills and reinforce those purchasing and supply management principles that have cross-category applicability.
Having the optimal talent to support your procurement transformation isn’t an accident. It takes leadership. It takes effort. It takes a plan.
Be a leader. Develop your talent. Then your procurement transformation will be a reality, not merely a buzzphrase.