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09 December 2019 5 min read

What was the future of Procurement and why did it fail to deliver?

Abdi Azimi

Abdi Azimi
Partner and expert in procurement and supply chain

Procurement is not alone. Or is it?

In our 3-part blog series, we touch on some of the recent history of Procurement, the exciting opportunity ahead of us and how we can get started.

Change is ever present and accelerating, impacting our personal and professional lives. The appetite to improve and strive for Better.Faster.Bigger is often met with resistance and apathy.

Over the last 20 years we have seen so many initiatives targeted at transforming procurement, making promises of a better future:

  • Procurement will have a ‘place on the board’
  • We will become more strategic
  • We will move beyond savings...or we will make more savings!
  • Our stakeholders will stop ignoring us, involving us earlier in their thought process..

... and so on.

There is no doubt that the many waves of improvements have made Procurement more efficient, and far better at executing ‘buying’. Such improvements include:

  • Strategic sourcing - professionalising the approach to buying and driving specialisation and focus into each of the (seven) steps
  • Business partnering - embedding a customer service ethos and ensuring that individuals are tasked with understanding what business stakeholders need
  • Technology - the functionality, ease of implementation and intuitiveness has come on leaps and bounds. S2C, P2P, analytics suppliers are plentiful and there are now a plethora of options to stick together this ecosystem
  • Category management - enabling a strategic view of how to manage external spend
  • Supplier relationship management - proactively managing suppliers both commercially and operationally

There have also been many reviews of the underlying procurement operating model, often leading to better more coherent structures, more efficient, more coordinated and increasingly automated.

So is there really a problem? Those of us that share the ambition of where Procurement could or should be will also share a core frustration. Procurement as a function or capability is simply not regarded as a strategic asset by many business stakeholders. It is often seen as an inhibitor, a controller, value corrosive and often completely misaligned to the corporate strategy. It can be seen as a means to an end – “rather someone else has that tricky conversation with suppliers about yet another unit price reduction!”

Procurement certainly can’t be accused of lacking effort over the last 20 years. The question for us to ponder is - has all this activity delivered the value we expected? Is there a different way?

And perhaps procurement isn’t alone in this.

In the next blogs in this series we look at why there has never been a better time to reposition Procurement and how we can get started!

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