Category Archives: CPO

Ardent Partners Steps Up Its Game — But Will the CPOs Rise Up?

Unless you’ve been under a rock for the past ten days you will have noticed that Ardent Partners — a research firm that has traditionally focussed on Contract Management, Accounts Payables/Invoice Management/e-Payables, Contingent Workforce, and CPO Advisory — stepped up their game when they hired Magnus Bergfors as VP of Research. Magnus, a former Gartner and Spend Matters analyst, possesses deep expertise on the Source-to-Contract side of the S2P equation, especially around Strategic Sourcing, Supplier Management, and the front-end of e-Procurement. With the addition of Magnus, Ardent Partners can now truly cover the Source-to-Pay spectrum.

Even though they only have three (3) senior analysts, at the very least, given the slew of departures from Gartner over the past few years and the key retirement at Forrester, Ardent Partners can now go head-to-head with these firms in confidence and possibly be more valuable to their clients than those firms. While the doctor doesn’t expect that they will be able to introduce a new market map (or even want to try given the technology dominance of the Spend Matters map), as every up-and-coming market firm is want to do these days, he does expect that, given the vast network of CPOs they have built up, Magnus will be able to draw out some fairly interesting insights from that group. Likely deep insight into the typical technology landscape, average Procurement department proficiency, key concerns of today’s CPOs, and so on.

But the question is, how will Ardent Partners make use of that knowledge, how will their clients, and what will Magnus do to disrupt the space in his new role? the doctor will be watching.  In the mean time, the doctor suggests keeping an eye on Magnificent Magnus Mondays for some hints into what might be coming.

Outside-In Issues are Shaping Modern Procurement — Is Your Organization Ready?

Last year, the doctor and the maverick identified twenty issues that were occupying a CPO’s mind in our post on what is top on a CPO’s mind, from overarching issues affecting the organization — such as economic instability, globalization, innovation and corporate reputation — to value creating methods that can increase the overall value of Procurement — like category management, supply base redesign, lean and six sigma and total cost modeling.

The reality is that if Procurement’s value is ultimately derived from the extraction of value from supply markets, then, by definition, the CPO Agenda is driven heavily from an outside-in perspective. This value starts with assurance of supply, and continues with innovation, market penetration, reputation, and regulatory compliance. In other words, the days of focussing on supply assurance, cost reduction, and demand management from a pure supply standpoint alone are long over for any company that wants to survive the 21st century and the many damnations it brings to Procurement (see the 100 Damnations index).

One has to remember that stagnant GDP growth, rising inflation, steady or increasing unemployment, rising inequality between the rich and poor and an increasing need for resources in greatly limited supply are creating a perfect economic storm that will sink any company not ready to compete in the global marketplace that has taken hold in most large economies. Value chains are becoming bifurcated and turned on their heads. Consumers want local and they want global on demand. Products need to come from everywhere and go to everywhere, be compliant with local and foreign regulations, be produced in a socially responsible fashion and be sold through the appropriate digital channels. And this all has to be done by Monday morning at 9 am.

Because, today, a CPO has to deal with half-a-dozen overarching issues that are shaping the course of supply management before she can get to the nine (or so) issues clouding her agenda and the dozens of value drivers at each layer of the hierarchy of supply. Over the next few months, over on the Spend Matters CPO site, the doctor and the maverick will be chronicling these issues, agenda items, and value drivers in three 10+ part series that have been in careful development for a while now, to, finally, give a CPO a complete overview of the mad, mad world they have to survive in.

The first post, on CSR, Environmental Stewardship, and Sustainability is up and ready for your reading pleasure. Check it out.

What Does it Take to Be CPO?

The short answer is, fulfill the CPO Job Description, even though the order is as tall as it is wide. Use their skills, education, and experience to execute the primary responsibilities efficiently and effectively.

However, this doesn’t help you understand how to

  • define the organizational Procurement strategy
  • create and manage short, mid, and long-term goals and objectives
  • create and leverage on-going value from the supply base
  • manage BPO activities
  • identify, realize, and maintain cost-saving and cost-reduction opportunities
  • etc.

So what do you do?

First of all, become A Procurement Leader.

Then, understand the primary responsibilities.

Support these responsibilities with the right procurement technology.

Use your leadership skills and technology platforms to both manage staff and develop staff.

Then, be sure to practice good budget management and align procurement with the other business functions.

And, finally, don’t forget to focus on continual learning and self-improvement. While the maverick and the doctor covered a lot in our series on the CPO job description and what it takes to succeed as a CPO, one thing we didn’t spend a lot of time on was the importance of continual learning. Nothing about Procurement and Supply Management is static. Everything changes, and everyday provides a new challenge that must be death with. New disruptions. New innovations. New opportunities. New threats. That’s why SI and the new site exist. To help you identify new practices, process, technologies, and ideas that will help you deal with all of the change to come but yet get through it.

How Many Procurement Myths Have You Fallen For?

As a Senior Buyer or Procurement Leader, you probably feel you’re doing almost everything right, or at least right enough to get great results. Maybe that’s true, but maybe you’ve fallen for a handful, or two handfuls, of the procurement myths that still plague even leading Procurement organizations to this very day.

If you think you’re at the top of your game, I urge you to follow the new series on Procurement Myths that the maverick is running over on the new Spend Matters CPO site. While the doctor isn’t co-authoring this particular series, he did work with the maverick to identify the most common myths and outlined what he saw as the most common symptoms, and these inputs are shaping the 25-part series to come.

Myth I and Myth II are already up! Check them out and see if you’ve fallen for any of them. (And if you have, as you are the leader, there’s still plenty of time to fix your perspective and lead the organization into a new era as they will never figure it out without you.)

Blast From the Past: Good Advice for CEOs, Good Advice for CPOs

SI originally ran this post six years ago today. It’s as relevant now as it was then!

Chief Executive posted a good article on why you should simplify and clarify your business. According to the article, knowing where to concentrate the effort is critical. A business should focus on where it earns money now and, even more importantly (in the doctor‘s view), where it will earn money in the future (as business, and demand, is constantly changing). To help you do just that, the article presented an approach to Keep it Short and Simple (KiSS) that it believes will help a CEO do just that:

  1. Clarify and communicate what the business is, does, and delegate down the line.
  2. As CEO, aim to remove yourself as much as you can from the dayt-to-day operational business and concentrate on strategic areas.
  3. Aim to reduce meetings and have a clear (and simple) outcome for those that do take place.
  4. Reduce the number of people involved in those meetings.
  5. Communicate, communicate, communicate.

This is also great advice for CPOs.

  1. A good CPO clarifies what procurement does for the business and how it meets the strategic objectives.
  2. A good CPO empowers her people to do their jobs and focuses on the big picture.
  3. A good CPO doesn’t waste her days in meetings … she spends them charting paths to procurement success.
  4. A good CPO only includes people who need to be there in meetings … and empowers those who are there to disseminate the information as required.
  5. Not only does a good CPO communicate, communicate, communicate, she also collaborates, collaborates, collaborates.