Last week we launched the Procurement/Supply Executive Round Table for St. Louis by holding a workshop for senior executives titled: The Road to the C-Suite. Many thanks to Rob Cox (proud of our Sourcing U alumnus who is now CPO at Centene) for his hospitality and hosting the event. We didn’t quite fill up the large auditorium that he arranged but I’m sure we will next time 😊.
Here are some of the conclusions to start with:
- All of us are facing the same challenges and struggling with the same set of issues
- We are all trying to make the transition to Category Management
- All of us have a different version of the truth when it comes to Category Management
- We are all trying to move on from Strategic Sourcing
- We know we must move beyond best price and TCO and start delivering Value – quickly
- Not doing the above is a matter of survival – it’s not a choice anymore
- We need to start changing the metrics we use to measure our performance
- We need to look at how we can influence revenue
- Time to Market is something we can and should be influencing
- S&OP initiatives are never going to be effective without us playing a central key role
- We need to embrace the role of an internal consultant and deliver to it
- Being a strategic business partner and advisor is a requirement – not an option
- Executives are expecting and demanding more and more from us – and it’s not just cost anymore
- Overall risk management is within our scope
- We must become a talent factory for our company – the best and brightest are produced by us
- We can be a competitive advantage for our company
As you can tell, it was quite an interesting day and a very exciting one too. Exciting because there was very broad agreement about the above conclusions. It is clear that we, as a profession, have collectively reached a tipping point – we are on the cusp of finally making the move to being a core strategic function and we just need to push to make it over. Frankly, it makes me a bit jealous and I wish I was 25 years younger to be part of this metamorphosis.
In addition, there was general agreement that we need to ensure that we are getting the most value (not just lowest price) from our suppliers and that will require a shift towards a much more collaborative attitude towards them – something sorely lacking in most organizations today. Getting aligned with business units and their value drivers, which most of the time is not necessarily related to price/cost, was also identified as a key challenge. In fact, this shift from cost to value probably generated the most invigorating discussion and clearly will be the most difficult challenge. This will require a change in our processes, changing the expectations of our executive stakeholders, a change in our roles, a change in our metrics, a change in how we select suppliers, etc., etc.
Not surprisingly the biggest change identified by every single participant was the change needed in the competencies of our people. We had everyone take a Talent Risk Snapshot survey individually, then as teams and then looked at it collectively. In every single instance, the tactical/functional competencies (RFP, negotiations, inventory management) received no more than 10 points out of a 100 – JUST 10!!! The rest of the 90 points were assigned to strategic competencies (change management, consulting, relationship optimization – both internal and external, teamwork, innovation, etc.). This was also a moment for a collective face plant because everyone acknowledged that this was clearly not reflected in how people were being selected, promoted, trained, managed etc. By the way, we find this phenomenon every single time we’ve conducted the Talent Risk Snapshot (if you would like to take it just let us know).
Again, many thanks to Rob Cox and we look forward to our next PERT meeting in St. Louis.