Focus in procurement shifted towards innovation and value, requiring an acceleration in the change in leadership, talent and innovation.
Procurement has continued to deliver short-term savings and manage risk to support growth during a period of uncertainty. As the economy improves, procurement has to increase supply chain transparency, accessing supplier innovation and delivering enterprise wide cost reduction. Exceptional procurement, supplier, business and digital leadership will differentiate those organisations that will make an impact that matters.
Key findings:
- Cost reduction (78 percent), new products/market development (58 percent) and managing risks (54 percent) remain the top business strategies for procurement leaders.
- 61 percent of procurement leaders delivered better year-on-year savings performance than last year.
- Supply chain transparency is poor, with 65 percent of procurement leaders having limited or no visibility beyond their tier 1 suppliers.
- 73 percent of procurement leaders believe they have the support of their organisation’s leadership.
- 51 percent of procurement leaders believe their current teams do not have sufficient levels of skills and capabilities to deliver on their procurement strategy
- The most common leadership traits are acting as a role model, collaborating internally and externally to deliver value and delivering results. Conversely, strategic leadership traits such as positive disruption, leading digital transformation and innovation are not widely evident.
- 33 percent of procurement leaders believe that their digital procurement strategy will enable them to deliver on their organizational objectives and value.
- The extent to which modern technologies are used in procurement is low, with only one-third of procurement leaders using technologies such as predictive analytics and collaboration networks.
- High performing procurement leaders out performed others in executive advocacy, leadership, strategic decision making, talent capability, digital procurement, supply chain transparency and balanced scorecard capabilities.
Leading in innovation and making an impact:
One of the opportunities for procurement leaders is to improve business, procurement, digital and supplier leadership. High performing organisations are delivering superior results and are excelling through:
- Leadership with the business, enhancing executive advocacy and business partnering.
- Leadership in procurement, driving changes in talent, operational models and digital capabilities.
- Leadership with suppliers, through greater collaboration and supply chain cost and risk transparency.
Recognizing focused and deliberate action is critical for procurement to be successful, this year’s report outlines a ‘To Do’ list linked to high performance to help accelerate existing and new procurement ideas, plans and results.
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