2019 isn’t quite over yet but as keen observers of job market trends, it’s already clear to us that there are several factors likely to impact on the procurement world and wider professional employment markets in 2020. Here’s what to watch out for:
- Procurement Technology gains more traction?
Will 2020 be the year when the leading CPOs truly start to covet digital procurement skills?
We think so. Momentum has been building slowly for a while and the conversations we have with many leaders tell us there is more appetite now than ever.
The catalysts for many companies will be more focus on training and development supported by key strategic hires, often from organisations that are already innovators in this area.
Hiring people, who have been on the digital transformation journey and know the route to best practice use of tools like SAP Ariba, Coupa, Jaggaer and Ivalua will become increasingly common creating a more competitive market. It’s a finite pool of people, many of whom have been waiting for the opportunity to be the architect of this transformation for forward-thinking CPOs as the next chapter in their career. We’re excited about working on these projects.
2. More growth for the solution providers?
There is already expectation in the market of a big hiring push at Coupa in 2020. The talk at Coupa inspire was of a planned investment of $55m in product development with strong rumours that this will be supported by aggressive hiring. 2019 saw significant PE backing at several vendors, most notably Ivalua and Jaggaer, and of course, investors will want a return on that investment which will typically include growth in both sales and headcount.
We already know that SAP Ariba are set on continuing their aggressive growth strategy including the protection of their existing accounts which is always supported by excellent talent acquisition (watch out for some high profile arrivals there in January 2020).
Meanwhile, new ownership at Wax Digital pushes them up into the bigger leagues. It’s expected that the investment will make them more competitive, both in terms of hiring and product offering. Plenty of best of breed solutions will look to build on strong performances in 2019 so the market should continue to thrive.
The battle for talent in an already competitive market will ratchet up a few notches in 2020 and we can’t wait – it’s what we love.
3. UK Election result brings more certainty?
It feels like a dangerous area to get involved in predictions, but we can’t ignore it.
Theoretically, the decisive result of the UK election is expected by many to mean some improvement in the wider job market. The theory being that the country can now hopefully leave the last three years of Brexit related inertia behind us, meaning companies are more likely to increase investment.
However, we still have uncertainty given that the big question remains about the impact of Brexit. Talking to people in positions of influence in the market, the feeling is one of cautious optimism based on the theory that finally getting on with it has to be better than what’s happened over the last three years.
Companies can now put plans in place for life with the UK outside the EU. Procurement and technology can be at the heart of the changes and whilst we don’t expect to see big headcount increases in the corporate world, increases in demand from the vendors and consultancies, along with a less cautious approach around replacement headcount generally, should see a gradual upturn in job market activity for the procurement world overall.
4. Tough year for the UK interim market?
April 2020 sees the introduction of IR35 into the UK private sector and it’s very hard not to see it having a negative impact on the interim market, certainly in the short term.
It’s going to create uncertainty for employers, contractors and recruiters will push employment costs up and the early evidence is that it will drive some contractors back into the permanent market. This is because they fear reduced demand for their services and the financial incentives to work on a contract basis have been eroded considerably.
For some companies, it’s going to present an opportunity to hire some seasoned former interim professionals on a full-time basis, and this could be particularly helpful to the consultancies who are battling to hire valuable yet scarce skills around P2P/S2C transformation projects.
Companies that really need the flexibility offered by the interim workforce will be faced with either increased costs (day rates, employment and admin costs) or finding a way to adapt their philosophy to help them navigate the rules of IR35. Companies that are able to do the latter have an opportunity to hire some great interims who will be attracted to projects that fall outside of IR35 whilst others get to grips with the new regime.
A note of caution – there are already some alarming stories circulating about people’s perceptions of how a contract role can fall outside of the IR35 legislation. It is important to get really good advice on this, ideally before you go to market for the skills you need to hire, so you know whether your project is likely to be affected or not because the cost implications of getting it wrong are significant.
If you need some guidance, please get in touch.