Do You Know the Difference Between Strategic Sourcing and Category Management? Develop Critical Thinking Skills!

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Make THIS your New Year’s Resolution!  I read this article in October in HBR “A Short Guide to Building Your Team’s Critical Thinking Skills” and decided to save it for my first blog of the new year because I think it is THAT important.  To move from tactical to strategic, reactive to proactive, Strategic Sourcing to Category Management requires a set of skills that are often not taught in school or even in corporate training but certainly should and can be.  An organization that IS DOING (and MOST are NOT) Category Management IS operating as an internal consulting practice with professionals with all the skills required to be consultants.

I’ve been consulting with clients on Strategic Sourcing and Category Management for over twenty years and the number one challenge has not changed  – how to make the Procurement organization a competitive advantage for the company?   Sometimes I feel like a broken record but ensuring that you have the right resources with the right competencies to play that business partner / consulting role is the key to success.  Critical thinking as outlined in the article is one such competency AND it can be taught. 

In my first role as a CPO many years ago, I hired a  premiere Strategic Sourcing consulting firm to help me do the work while I was building an internal function.  I required my consulting partner to work with my people to teach them the Strategic Sourcing process.   But as the consultants and my people worked together there was clearly a difference in the skillset.  I went to the partner on my consulting engagement and asked him to help me determine the gap and it took him about 30 seconds.  He explained that every new consultant in his firm was put through a “consulting” bootcamp which focused on teaching critical thinking skills.  There is a very specific process which consultants are taught, and it is the one described in the HBR article.   So, I did the same (I hired the same firm to put my people through the consulting bootcamp) and it significantly changed the way my people approached problems, engaged with our internal business partners and executed the Sourcing process.  This was a game changer for my group.  But in addition to the training, I also made sure that my people had the opportunity to USE the new skills. This very same training is part of The Mpower Group’s Strategic Sourcing / Category Management University and is a “fan favorite” among our clients. 

As you charge into 2020, make a commitment to move your organization to the next level of maturity. If you are looking to get to Category Management, you will not get there unless you have the competencies to get there and critical thinking should be at the top of the list.  As we all know,  the Procurement function has a tremendous opportunity to provide Value to a company either through cost savings or revenue generation.  If you want your organization to be competitive advantage for your company, then you MUST invest in the competencies of your people.  Those competencies that are most critical for success are the ones often referred to as soft skills.  That investment must include ensuring adoption of those new skills.  That requires leaders to ensure that your people are given the opportunity to hone those new skills through practice.

Our profession offers so many challenges and opportunities that it can be a rewarding career for anyone.  Building an internal consulting practice will ensure that Category Management and beyond is achievable for your group and you may even find yourself in a situation where you are a talent factory for the rest of the company.  Make “developing critical thinking” skills your New Year’s resolution!

Let us know what you think and join in the conversation . . . . . .

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Anne Kohler
Anne has been leading consulting and financial management organizations for over 25 years. She has extensive expertise in Strategic Sourcing, change management, contracting & contract management (both the buy side and sell side) organizational design and supply chain management. Anne has a passion for collaborating and educating her clients while helping them to uncover hidden value in their organizations. In addition, Anne has been named by Supply & Demand Chain Executive as a “Top 100 Provider Pro to Know” every year since 2007 and a 2013 Top Female Supply Chain executive.
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