The future demands a new operating model.

Agility will be key to keeping pace with a fast-changing landscape. And technology is transforming the shape of the procurement workforce: automating lower-value tasks, and moving the focus to higher-value activities like category innovation.

As a result, the procurement function of the future will look very different.

Category managers endlessly running a single category will be rare. As priorities constantly shift, procurement must be able to scale specialist resources up and down, while doing more with less.

Embedding agility

An agile operating model encompasses all aspects of the procurement organisation:

  • Structure – role, size, shape and delivery model. Structures will need to be lean, right-sized, and focused on higher-value services.
  • Decisions – methods, decision-making and governance. Simplified governance and decision frameworks, with cross-functional alignment, will be crucial.
  • Culture – typical procurement behaviours. It will be vital to define the culture needed to support the procurement strategy, and sustain long-term value.
  • Flexibility – the capacity to execute and manage change. Innovation, continuous improvement and future-proofing will all be essential.
  • Performance management – monitoring effectiveness. Key success factors will include clarity over what drives business value; and the function’s performance at the enterprise level.
  • Leadership – strategic direction, support and communication. Procurement leaders set the bar and drive accountability, but cross-functional and cross-unit leadership will be increasingly important.

Agile procurement in action

A global telecoms firm has broken down its rigid category team structure, creating a more fluid procurement function – with a greater focus on high-value, and even business-critical, initiatives.

What’s next?

It’s no longer business as usual for procurement. The scale and speed of transformation required to address market disruption is extraordinary.

Success requires a blueprint for turning disruptive events into opportunities to drive competitiveness and growth.

This is what the future demands of procurement. Contact us today to start moving forward.

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