It’s been proven that a comprehensive focus on all three areas of the procurement function, what we tend to call the three-legged stool, will result in the most value.
One of the more common challenges many procurement organizations are faced with when it comes to advancing the capabilities of the function is who is going to help them take things to the next level.
Sure, many have tried to go it alone, but few have fully realized true success in doing so. Decisive decision-making can make or break the journey to improving procurement capability.
Being prepared to take a holistic view of the current situation and be completely honest about the issues, gaps, and pain points is critical. Many, even mature organizations, believe that they fully understand the situation and can implement changes on their own. Rarely is that ever fully achieved.
In most cases, to successfully achieve a comprehensive procurement uplift, getting the right players involved might be all it takes.
It’s important to consider every facet of the procurement function in an equal way when mapping out the approach.
Many organizations fall short when they focus on a mere one or two aspects of their operations, such as just upgrading automation or focusing on only refreshing their skill base. These strategies often just lead to the identification of more gaps.
Successful procurement organizations have realized that in order to take their business to the next level, they are best suited by first examining the current state of their operations by looking at everything from how they fulfill purchase requests to how they manage supplier relationships.
Mature procurement organizations work diligently to acquire a deep understanding of their in-house skills, the organizational design, culture, governance and reporting, strategic alignment, supplier selection, buying processes and use of technology automation. It’s been proven that each of these aspects of the procurement function are intertwined, so realizing true change results from only a holistic review.
As the team initiates the plan, it’s import for the team to resist taking shortcuts.
For example, some procurement leaders have been tempted to try to cut corners by ‘reducing the target participant participation’ in order to lessen the burden on their teams or ‘reducing the scope’ to speed up the project. This tends to be more typical of procurement organizations that need the most guidance on their journey.
Certainly, there is good value in a solid spend analysis and even a reliable procurement productivity analysis, but it’s just a part of getting started. However, for the procurement uplift initiative to be a success it benefits most from a much more thorough set of maneuvers. Naturally, having a professional guide on your side can’t hurt either.