Skills Implications – The Rise of Digital and Sustainable Procurement

In our bi-annual Procurement and Spend Management Insider report we have consistently talked about the skills needed for the future of procurement, particularly digital procurement. 2020 saw the rapid rise of the ESG agenda in supply chain and further acceleration of the adoption of digital procurement tools.

Both trends had been around for a while, and are now more interconnected than ever with the rise of businesses like Circulor and Ecovadis, but the pace of change has materially changed in the past year as we’ve seen in this research.

So we are no longer talking about the future of procurement when we discuss digital or ESG because the future is here, and it’s called the present. This is procurement in 2021. You, your teams and your colleagues can either get on board or you and your employer can get left behind as the more agile, digitally enhanced businesses with a clear environmental and social purpose thrive.

In terms of further evidence to support this theory, management consultancy Hackett Group asked Procurement leaders if they recognise a need for more tech-centric roles in their teams. Here are the results:

It is clear from this that roles such as that of Digital transformation program manager are recognised by the leadership community as being important. For many, this function is effectively run by their advisory partners, but on the evidence of those that have specialist in house roles in this area, their management of the advisory businesses, specialist contractors or internal resources are vital to the successful adoption of procurement tools, whether they be full suite solutions or a range of best of breed, specialist tools.

There is now a significant talent pool of people who have undertaken this role on behalf of end users. There are also consultants who would like to go into this sort of position so they could see projects through to completion and ideally push for ongoing pursuit of best practice.

The frustration for the people we know in this space is that there are so few organisations who currently have dedicated in house roles. There is growth in this space but it has been slow so far. We hope and expect that will really start to change now.

The other roles that score heavily in this research like RPA or AI/ cognitive specialists, and data architects are also on the rise but again at a disappointing pace. There is a much smaller talent pool of people who can point to experience in this area dedicated to procurement and supply chain but they do exist.

In each of these areas we hope to see accelerated growth in demand for the skills but it will be constrained by the availability of skills. The answer to that question lies in the ability of CPOs to attract sought after external talent and/or train and develop these skills in house.

The best examples we see involve hiring an expert who has been down this path already in their career who can then influence those around them in a new organisation to become a catalyst for upskilling colleagues and ultimately the function as a whole.

The key is to know who the early adopters are, the companies who have got it right and then understand who their trailblazers are. If you can find a way to attract them into your organisation you can do great things.

It’s a similar story when it comes to identifying people who have been at the heart of innovative projects that have materially changed the impact procurement and supply chain teams can have on environmental and sustainability initiatives. Many of them have joined the wonderful Sustainable Procurement Pledge initiative created by a group of visionary leaders, the growth of which tells its own story.

Looking at the achievements of some of the members of this initiative supports our belief that great hires in these areas can be a catalyst for raising the contribution of procurement and supply chain teams, raising the bar across the function and helping leaders to position their functions at the heart of the sustainability agenda.

If you know which companies are already at the forefront of these initiatives, you can identify the people who can make a real difference to your organisation. It’s all about prioritising your objectives and attracting the talent that will enable you to deliver on those aims.

Procurement Leaders – if this resonates with you then Edbury Daley can help you make real progress when it comes to identifying, attracting and ultimately hiring high performing specialists in these areas.  Please contact Andrew Daley via andrew@edburydaley.com or Peter Brophy – peter@edburydaley.com

If you enjoyed this article and found it useful, perhaps you might be interested in Fairmarkit’s piece that raises some relevant points on this topic –  The hidden threats COVID-19 poses to procurement sustainability

The problems we solve – Problematic business critical roles and how we fill them

The Procurement Technology market has specific characteristics that make hiring for certain skill sets particularly challenging.

If your current recruitment model is failing, It’s likely that it’s because of one or more of the following reasons:

  • Advertising hasn’t identified the right candidates
  • Your in-house or outsourced recruitment team doesn’t know where to look for the right people
  • Your recruitment partner doesn’t have a strong enough network or market knowledge to identify the right candidates
  • The people you want are in high demand generally and could be too expensive for your salary bands
  • The career opportunity you are offering has not been presented to the market effectively in order to get the interest of relevant candidates
  • Your selection process is floored.

A key part of our service is our unrivalled market knowledge and international network of sector specialists and using our Talent Intelligence model we’ll give you access to people that aren’t currently available to you through your existing methods.

The future of your career

The Future of your Career – Part 1This article is the first in a regular series from Andrew Daley offering career development advice and sharing learning resources. Whilst aimed at procurement professionals with a desire to embrace the new era of digital procurement, this series should prove valuable to anyone seeking professional guidance on protecting the future of their career.

“Procurement faces a wake-up call as tectonic shifts in technology threaten to completely alter the function, leading eventually to its automation.” (Source: The Future Of Procurement Technology by AT Kearney).

This quote was the first slide in my presentation at the Basware Connect event in October entitled “Climbing the career ladder in an automated world”.

At SAP Ariba’s Procurement Summit a week earlier, one of the clear themes of the day was that the profession has a unique opportunity to change itself with the technology available, but it has to take responsibility to further its own agenda.

My conclusion from the two events was that the profession can’t wait and allow change to happen to it – it has the embrace the opportunity and dictate its own agenda.

Whilst on stage myself at the SAP Ariba event, I talked about the lack of spending by CPOs on training budgets as outlined by recent research from Deloitte. So my message to audiences at both events was to take personal responsibility for their own development, as it’s up to them to embrace the opportunity for the future of procurement, individually and as an entire profession.

So I’ve decided to continue this theme of developing yourself, or as one of the delegates at Basware put it “self education”, with some regular guidance on personal development that I hope will help you take advantage of all the resources available now, rather than waiting for your employer to invest in appropriate training.

People who take action now will give themselves a significant advantage over those that don’t next time they enter the job market.

This month I’m going to start by sharing what I consider to be some really useful learning resources for those seeking to understand more about the digital procurement revolution.

It’s no secret that I’m a big fan of the Spend Matters website. It’s the ideal place to stay appraised of developments in the technology and thought leadership on the skills required for the future of procurement. I’d advise frequent visits to the site. Alternatively you should follow them on Twitter for regular updates on their excellent content.

Their writers do a great job of cutting through the hype and getting to the crux of the matter. They also keep readers updated with dates for the wide variety of procurement conferences and events which they attend themselves and then write useful reviews.

If you want to dig deeper yourself and have the time, there’s a vast amount of “thought leadership” available on the evolution of procurement. The leading management consultancies and software vendors are particularly fond of publishing research and opinion so it’s well worth registering for white papers from the likes of Deloitte (here’s the 2018 CPO Study) and AT Kearney. Hackett Group has also produced some good reports on digital transformation.

Amongst the software vendors there are always plenty of learning resources available online. Some are quite salesy, while others try to be more educational.  SAP Ariba’s Procurement 2025 is a particularly good one, and talks about the golden age of procurement. You can access it here.

One of the benefits of registering to download this content is that you’ll get updated when they publish new content and potentially get invited to their events. I’m a big advocate of attending these conferences. They are a great opportunity to hear about best practice from the profession’s leaders and learn about the power of the technology available now, and in the near future. They also offer a great networking opportunity which might prove invaluable next time you are in the market for a new job!

Of course, social media is another way to find all this sort of content. You don’t need to be particularly active on the various platforms if you don’t like them, you can still gather useful information when it suits you.

Much as we love LinkedIn, the more people you connect with, the more noise and irritating Facebook style behaviour you are exposed to. This reduces its effectiveness as a news source in my opinion.

One way to address this is to use its group functionality effectively. By joining relevant groups you are able to refine your content and focus on areas where the information is more relevant to you.

There are lots of good procurement options to research. We’ve assembled a great community around the procurement tech’ market which you are welcome to join here: Procurement Technology Specialists

You should also take a look at Procurious if you haven’t done so already. They are a much more specialist resource for procurement pros. They are doing a great job of promoting developments in the profession through their “Big Ideas” initiative. You can register as a digital delegate for their forthcoming Big Ideas Summit in Zurich here.

This is what they’ve had to say about this event:

“For the first time ever, we’ll be filming and streaming the entire day’s event via the Digital Delegates group on Procurious. If there was ever a time to register for one of our summits, it’s now. Featuring presentations and interviews from some of Europe’s top procurement leaders, we’ll be discussing procurement and supply management towards 2030, the future of talent, automation, blockchain, diversity and so much more.”

I hope you find some of this content interesting, hopefully even inspiring, and it will help you to start thinking about the future of your career more if you haven’t done so recently. We’ll be looking at other subjects such as further education and training opportunities as this series develops, but I’d like to finish with a couple of points from me.

A great lesson I learnt a few years ago when Simon and I started the business was to “begin with the end goal in mind”. So I’d advise that you start by developing a vision of where you see yourself career wise in say five or 10 years.   Then try to work out a plan for how you are going to achieve your goals using all the resources available to you in the modern world.

Finally, some thoughts on what I’m going to focus on myself for my personal development. At the aforementioned Basware event I particularly enjoyed the keynote speech from respected “Futurist” Rohit Talwar. He’s inspired me to look further into the future about what’s next in business technology so I’ve just started one of his books – The Future of Business.

Here’s one of his presentations on YouTube – he’s well worth watching.

Also having really enjoyed my recent public speaking engagements I’ve decided it’s time for us to take the next step and do some video content for our website for the first time. I’ve challenged my colleagues to join me so watch out for our vlog debuts in January. Filming starts just before Christmas. Should be an interesting challenge!!

My next article in this series will be in January. Please let me know if you’ve got any questions that you would like me to address (confidentially of course!!!) via andrew@edburydaley.com I’m also interested to hear about what you are doing in terms of your professional development.

Alternatively follow us on Twitter or Linked In.

If you’ve found this article useful, you REALLY need to read our Procurement & Spend Management Insider report. It’s designed to give you an insight into the employment market conditions for your skills, so it really would be remiss of you to miss it! You can register to download the latest edition here.

Andrew Daley

Director, Procurement & Spend Management

Procurement Leaders – The Talent Attraction Reality

We attend a lot of procurement conferences and events and as a result we hear a lot of CPOs talk about their businesses, their priorities and their objectives.One of the common themes is the attraction and retention of talent.

In a recent report on the Future of Procurement by SAP Ariba they quoted some interesting statistics: 63% of procurement leaders do not have an established talent management strategy. The main barriers to achieving organisational efficiency enabled by digital procurement are:

Lack of data – 23%
Budgetary restrictions – 19%
Lack of internal talent/knowhow – 17%
Shortage of external talent – 13%

So when you combine the two figures for talent shortage (internal and external) you get 30% which effectively makes it the biggest barrier to organisational efficiency.

So CPOs are making all the right noises about the importance of people but what is the reality?

Or to put it another way, is procurement making savings or adding value in the recruitment process?

Procurement has gained significant savings in the recruitment category over the past 15 years. The implementation of PSLs and the leverage of the company’s buying power yielded easy wins. But with many recruitment companies now operating at tight margins the opportunity for further savings seems limited.

In light of this Procurement needs to add value to the business in terms of supply of recruitment services. Rather than view recruitment as a commodity to be bought mainly on price is there opportunity to find value? Let’s not forget, barely an annual report is published without a CEO reminding us that ‘people are our greatest asset’. So why is such a business critical category reduced to the lowest common denominator?

The commonplace commoditisation of recruitment is underpinned by the binary perception that a vacancy is simply either filled or not filled. Therefore it is just a question of filling the position for the lowest possible cost. To move away from this view requires insight in to time to hire and performance of the new recruit over a sustained period of time.

The first variable is easy to measure but a little harder to evaluate, particularly for highly specialist positions where the potential candidate pool is small. For example it’s unreasonable to compare time to hire for an office based admin position, where the candidate pool is huge, to time to hire for a rare skill set position, where only a handful of relevant candidates exist in a given geographical region.

Nevertheless, the recruitment supplier’s ability to find and place candidates as quickly as possible undoubtedly has a clear value to the hiring company, therefore should be part of the supplier selection criteria.

The second variable is the performance of the new recruit over a period of time. Anecdotally, most senior managers will know who their star team members are and who are only just meeting the minimum performance requirements. However, turning this into quantifiable data is a real challenge. And how often does the senior manager trace back the origins of the high performer in terms of which recruiter sourced the candidate, and then use this information to influence the choice of recruitment supplier going forward?

The typical PSL based contingency recruitment supplier arrangement serves to reinforce the commodity view. By instructing, say, three agencies on a vacancy using the ‘no placement, no fee model’ urgency is created amongst the suppliers. This helps minimise time to hire as the agencies race to ‘win’ the fee but incentivises the suppliers to submit only candidates they can access immediately rather than seek the best possible fit for culture and performance potential which may be a little more time consuming. In other words the long term value to the business may well have been sacrificed for speed.

Much is made by forward thinking procurement leaders of supplier relationship management. By forming a true partnership with suppliers they can create an opportunity for collaboration and innovation that benefits both supplier and customer. Examples cited often come from the procurement of components or raw materials but could this extend to recruitment services?

We have written many articles on how companies can improve their talent attraction, streamline their selection processes and get a deal done with the right candidate. Our knowhow and experience has the potential to be a game changer for a customer looking to be better. Will procurement embrace that opportunity?