Your Procurement Career is Stifled. Here’s Why

Procurement pros have it tough. Every industry, every country, every level in their company. 

To be sure, there are a subset of highly successful procurement pros, but the vast majority of non-CPOs we talk to tell us they aren’t at a level in the organization that they expect and deserve. Frustration abounds.

Let’s cover some painful truths first.

Business units do their own thing. They engage procurement late and when the results are predictably sub-par, it’s suddenly procurement’s fault.

Senior management, when faced with business unit escalations regarding procurement’s intrusive requirements, almost always side with the business unit.  After all, they need to pump product out the door.

Internally within procurement, there is never enough headcount, never enough budget, little capacity for funding external training, and there are new initiatives every month – none of which contribute to cost savings objectives - that get piled on top of existing workloads. 

Sales organizations that procurement negotiates with have developed backdoors with the business unit, forging relationships and preference.

Business units are asking for goods and services that are most often ill-conceived.  Why? Because they don’t have a bachelor’s degree in “end userism”. They don’t have training in how to take all unnecessary costs out of a SOW/spec. 

They don’t have training in how to solicit for performance results, and so instead they solicit for goods and services. Post contract problems are guaranteed. After the supplier has your money. 

Systems being used by procurement are most often part of a monolithic ERP that was selected and modified with some other group’s interests in mind, such as finance, sales, HR, or accounting. 

We all landed in procurement by accident. Nobody plans to be in procurement. We’re the only business profession that was completely assembled by accident.

But is all dark in this profession?

Not hardly. This is the best profession in the world. The easiest one to become a rock star in.

You see, if you find someone with 25 years’ experience in procurement, they most likely have only one year's experience. 25 times.

And who taught them procurement? How to negotiate? Other people who landed in procurement by accident. And your suppliers love you for it.

What about the procurement rock stars? What makes them different? What’s the secret sauce? How does one become a procurement rock star?

Read This Twice: The most important skill is the one you’ll never learn in procurement: The ability to influence.

You might think “What do you mean? I influence all the time! I’m constantly in supplier negotiations! I’m an expert influencer!”

Yes, but you are doing that with money involved. Lots of money. Why is it that suppliers will do what you ask, but your business units will not?

Answer: because there’s no money involved when you ask business units to follow your lead. You are no longer negotiating. You are influencing. Influencing doesn’t involve money. Influencing requires special skills that procurement is never taught.

The ability to influence is the #1 factor that separates ordinary from incredible procurement professionals that are on the CPO fast track.

Great procurement influencers excel at driving change in 4 areas:

Influence Area #1: Internal to procurement

The best procurement professionals know how to influence internally. They know how to influence internal strategy within a highly matrixed environment. In an environment where procurement is in different geographies, with local management having unique priorities. With commodity teams that may report to regional purchasing managers. The ability to manage through people with Re

Influence Area #2: Horizontally to end-user business units

Great procurement influencers know how to get business units to fall in line because they want to. Because they see the value. Because they see the direct benefit to themselves by doing so. Lousy procurement influencers try to drive compliance-based strategy based on policy and process requirements. And it never works.

Influence Area #3: Cross-organizational to stakeholder groups (finance, HR, legal, etc)

Great procurement influencers know how to negotiate with other support organizations for their time, attention, action. Legal to help prioritize and improve contracts and contract processes. Finance to help with cost modeling and validation of cost-saving strategies. HR to help with learning and development models for procurement. IT for the selection of systems that benefit not only sales and marketing but also procurement.

Influence Area #4: Upwards, to senior management

Great procurement influencers know how to influence upwards, through their management teams. Great procurement influencers have a seat at the table. Lousy procurement influencers are on the menu for lunch. Great procurement influencers know how to establish the procurement value proposition beyond cost savings and with more focus on contributions to EBIT. They know how to negotiate for and receive increases in headcount, budget, and discretionary budget for training. They know how to influence procurement as a function out of the back office and into a front and center role as a value-added center of profit.

So if you want to be a procurement rock star, stop looking in the wrong places. The #1 area where you can drive the biggest change is to become a world-class influencer, and this means to stop using any of the tactics that work with suppliers because those rules don’t apply in internal influence models.

Now go off and do something wonderful. Be your best!

- Omid G.

“THE Godfather of Negotiation Planning” ~ Intel Corp

P.S. The CPSCM™ Certification does a deep dive on influence models, getting business units in particular aligned with your procurement objectives because they want to, and not because they have to, and showing how to have them help rearchitect the overall procurement process flow to be singularly focused on the acquisition of performance results, while surgically removing unnecessary costs from the demand.  Come join the best in the world today.