In a World of Constant Change is the Organizational Span of the Procurement Executive Short Lived
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Transcript of In a World of Constant Change is the Organizational Span of the Procurement Executive Short Lived
Transaction Driven Efficiency Driven
Price Driven
Globally Driven Cost Driven Business Strategy Driven
CEO/Vice Chairman
Male $15 Billion Food Company
Executive VP Office of the President
Female $8 billion Insurance Company
CFO Male $10 billion Medical Device Company
Question 1 • “They are respected as good negotiators
and people that make the company money. They are not recognized to the degree sales people are when they succeed, but they should be.”
• “I would say the purchasing team is
perceived as highly knowledgeable and competent in their area. They are considered part of the operations. However, I think they may be taken for granted by many. Not sure why but I do get that sense.”
• “Procurement has typically been seen as a rule enforcer and another time-consuming step in the process for the business to get what it needs. We have been working to show greater value through cost savings, risk avoidance, value creation in contracting, and also leading the diversification of the supply base.”
How is the purchasing team perceived in your business?
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Question 2 • “Not as well as they are in our
company. Most are considered highly paid ‘bag men’ who don’t collaborate but largely threaten.”
• “As rule-based order-taker.”
• “They seem to need a champion in the organization to promote what they are doing achieving.”
How do you think purchasing people are perceived in general?
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Question 3
What can they do to improve themselves to close any gaps?
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• “They can get help and training from many programs in the company and can also access outside resources that we make available.”
• “Learning the art of managing expectations and partnering to fill the business need while at the same time ensuring compliance.”
2013 ISM Study
CEO Perception
2013 ISM Study
CEO Perception
Source: “The Deloitte Global CPO Survey 2013”
Source: “The Deloitte Global CPO Survey 2013”
Barrier 1
45% reported misaligned objectives
Barrier 2 36% reported lack
of resource
Barrier 3 33% reported lack of internal
resource
GOAL
Barrier 4 32% reported lack of
influence
VALUE PATH
Source: “The Deloitte Global CPO Survey 2013”
© ADR NA 15
© ADR NA 16
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• The Average is 4.6 years (CAPS Study)
• I know personally 9 long term high profile CPO’s fired in 2013
• Management is expecting change and value delivery
• Building high performance procurement teams is critical
• Building high performing integrated Supply chains is a must
Lack of supplier Innovation and value delivery
Cant manage multiple generation team
Total focus on Cost
Unable to cope with matrix environment
Fail to gain internal collaboration
Fail at external collaboration-SRM
Key Reasons
Get left behind & be changed out
Develop new skill sets and change
Captain Richard Phillips “you cant fix 100% of your team
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Q & A time
