“If you don’t currently have a CPO or an SVP of Sourcing and Procurement that’s a rockstar and a pied piper of sorts, you’re not going to get the organization to where it wants to be.” – Emily Rakowski, VP Marketing, SAP Procurement and Ariba
Buyers and planners are at the bottom of the “procurement value pyramid,” the Hackett Group reports. Want to be at the top of the pyramid? Increase your contribution to the business by becoming a trusted business advisor. But what does “trusted business advisor” really mean—in concrete terms—and how can procurement focus on shifting perception of its role?
To find out, I sat down with Emily Rakowski, VP Marketing for SAP Procurement and Ariba. In Part 1 of our interview, we talked about who’s sitting at the proverbial table, what they’re talking about, and how procurement can join in. Then our conversation turned to roadblocks, rockstars, and the need for a better job description. Here’s Part 2 of our Q & A.
Q: What’s the biggest roadblock in the way of procurement professionals getting a “seat at the table”?
It’s very hard to find people that have the right skillset—that combination of having the information, knowing what to do with it, and bringing it all together to form a big picture. Instead, you might have people that started out as buyers or category managers and really only know that one function. If they haven’t been exposed to other areas of the business, or to the overall business strategy, it’s going to be really tough for them to have meaningful conversations with business stakeholders.
Let’s go back to my Newell Rubbermaid example. If you’re consulting with the president of that company’s Graco line of baby products, you need to be intimately familiar with that business unit. You need to know exactly what its strategies are, where it is in share of market, and where the president wants to take things. You need to know what the problems in the past have been: have they had quality issues or recalls, have they had profit margin issues in strollers or high chairs? Procurement needs to come to the table with knowledge of those problems and a willingness to brainstorm or offer potential solutions. Not that they want to be super prescriptive—you want this to be a partnership and joint planning effort—but they need to at least show that they have a joint understanding of these issues and can be engaged in a rich conversation about what kinds of solutions procurement can support.
You don’t see a procurement title very often that is “procurement representative to the baby products division.”
Yet that is just the kind of role that procurement needs to have in order to become a trusted business partner. And it’s procurement’s job to start very quickly evolving their job descriptions and their competency matrices. Procurement needs to recruit out of other parts of the business—like product development or supply chain. Employ people whose job it is to know that big picture, to be that partner to the business unit.
Q: Does procurement have a self-imposed image problem?
Historically, procurement has not always been seen as the coolest function to work in. But it’s definitely getting better because people in procurement are so highly sought after nowadays. People coming out of supply chain programs or out of MBA schools are getting snapped up a year before they even graduate. Clearly procurement offers the potential for a long and fruitful career, and there aren’t many areas of the business where people can stay long-term anymore and continue to learn and grow in new ways.
Procurement allows you to move around and understand every single aspect of how the business is run.
You can get involved in many different categories and business units. You can always be learning about new suppliers, new approaches to the function itself, and best practices. You can use your negotiating skills and your influencing skills. Someone who is interested in being a successful businessperson can flourish in procurement. And that’s not just BS because I’ve been in the space for 15 years! I’ve seen individuals who started 10 years ago move up and up and up…going from a sourcing consultant all the way to CPO. And it’s because they embraced the idea that procurement is a big important function. They understood the broader business and then did a deep dive into operations and procurement. Once they’re in a leadership role, they embody the right skill sets and know how to hire for those skills.
Q: What are the top two things you think procurement can do to rise up to a broader, more strategic role within the wider business?
First, drum up excitement during the hiring process.
Don’t just say, “You’re going to be a category manager and you’re going to know the market for a certain commodity, and so on.” That shouldn’t be the job description. It should be, “You’re going to be hired into this organization that influences and has reach into every aspect of our business. It’s exciting because you can learn everything about the different business units.” Sell it to job candidates so that they really understand what the possibilities are for a career in procurement.
Second, make sure that the people leading that hiring process and leading the team are “cool cats” that practitioners will want to emulate.
Look at the procurement professionals that are always active and visible at events—like Ariba LIVE and SAPPHIRE, or conferences run by Sourcing Interests Group and Procurement Leaders. These are the superstars that understand how great the function is. They are the keynote speakers, the ones being tapped to promote the function to the world. That’s the kind of person you need to have leading your organization.
If you don’t currently have a CPO or an SVP of Sourcing and Procurement that’s a rockstar and a pied piper of sorts, you’re not going to get the organization to where it wants to be.You need to really look at that top talent within procurement. When people are motivated to run alongside those leaders, you’ll achieve great results.
Employees of world-class procurement organizations receive 13 more annual training hours than other organizations. Find out more about what top procurement performers are doing to win the war for talent. Get the Hackett Group Report: 5 Characteristics of World-Class Procurement Organizations.
Amy Moore, content marketing director at Ariba and SAP, writes stories about the world of sourcing and procurement. Follow Amy on Twitter.