Top pressures driving procurement focus

A recent report from Aberdeen has identified the top pressures driving procurement focus. They include:
• Top down directive to cut costs   69%
• Increasing supply risk   27%
• Lack of visibility into enterprise spend   21%
• Insufficient number of staff   20%
• Insufficient skill of staff members to capitalize on savings opportunities   18%
• Increasing globalization/supply chain complexity   18%

The report, “From Preservation to Prosperity; The CPO’s Agenda for a New Decade”, has found that procurement organisations are being charged to do increasingly more with existing or fewer resources.

This pressure has rightly led to automation of many procurement tasks such as requisition and invoice approval, spend analysis, contract management, etc.

However, in the short run, automation initiatives often strain Procurement resources even further because they must continue to support the current processes while designing and implementing new, automated ones.

There are uncountable examples of purchasing organizations whose savings initiatives have come to a screeching halt due to ERP implementations.

The pressure to deliver more with less combined with skill and process obsolescence often drives procurement management to seek outside consultants. Although traditional consulting firms may help, they often leave the sponsoring organization with a huge bill for services and internal resources who are no better equipped than they were to begin with.

Fortunately, there is a new breed of consulting firm that addresses this dilemma. The “graying of America” and the corporate downsizing of the last decade have spawned “boutique” consulting firms comprised of highly seasoned procurement professionals who are often willing to work on a gain share basis.

Their highly experienced professionals work alongside existing resources, helping to design new strategic processes and coaching teams through implementation. They teach your people to fish!

Simultaneously, they handle much of the “leg work,” allowing savings initiatives to move forward at a more rapid pace. Their efforts are paid for out of actual bottom-line savings with a guaranteed ROI leaving your company with money in the bank and making you a better-equipped organization.

Read more here.