Effectively positioning procurement within an organisation

The next podcast from our series in partnership with Procurious, titled ‘Upgrade: be tomorrow’s CPO, today’, features Barclays’ Managing Director and CPO, Al Williams. He spoke with Philip Ideson, founder and host of The Art of Procurement and founder of ProcureChange, to provide his insights into how the procurement function should be positioned within businesses, and how talented professionals can be recruited and retained.

Click on the video at the end of this article to listen to the full conversation – meanwhile, here are some highlights from the episode.

When asked about how procurement should be positioned, Al explained that we need to be “positioning procurement as a strategic value-added player in the business and not transactional”.

Procurement is not and should not be viewed as a transactional function. Al explains: “If we act transactional that’s how the business treats us and that’s how we’ll be perceived by the business.” To overcome this, it’s important to add value to the business and we can do this through a number of ways.

Every business has an overall strategy and specific goals to achieve. Al highlights that it is important to make sure that: “We align to the key business metrics or the key business outcomes that are important to the overall business strategy.” This might include the financial metrics such as profitability.

He also added that risk is often a key metric for businesses as well, so be sure to align to the organisational risk tolerance and risk temperament.

“Speak the business’ language. Speak their outcomes, their success measures. Speak in their terms, and leave procurement jargon to procurement settings.”

Al states that: “Procurement needs to be consultative, it needs to be in a position of influence, it needs to be helping the business, it needs to be sharing perspective, market knowledge, helping shape strategy.”

It’s not uncommon for the procurement function to be the communicator and enforcer of certain policies. This is an opportunity to help the business. Procurement should be the function to help the overall business be compliant with policies, and a myriad of different steps and checks in the process, rather than simply issuing a policy and expecting the business to comply.

Innovation within procurement has been highlighted by Al as the key to driving change, along with frictionless procurement. He often seeks to employ leaders who have innovative approaches to problem-solving. This encourages innovative thinking throughout the organisation as it filters into their teams.

Leaders use innovation Al says: “To get the best value out of what the organisation needs to procure, service or product or otherwise, to operate and to deliver its service to the customer.” So, individuals who are willing and able to embrace change are essential.

Innovation also plays a vital part in attracting talent. People want to be a part of organisations which encourage and support innovative thinking to problem-solving.

Matthew Friend, Associate Director at Michael Page Procurement and Supply Chain, comments: “As the landscape of procurement changes and with the separation of transaction services, the ability to add value to customers becomes critical and the approach becomes more and more important.”

He suggests asking yourself key questions surrounding innovation within your business.