Summer, February 2013

Procurement 2032

“Twenty years from now, I very much doubt that procurement will exist in the way we know it today,” says Brett Mann, Manager Program Governance, ENERGEX. “Responding to the economic, social, geo-political and technological challenges of the next two decades will require fresh perspectives on tried and true approaches.”

Representative of a dynamic new generation of procurement professional, Mann recently graduated from the Procurement Executive Program (PEP). 

“Procurement, as much if not more than any other function, will be impacted – potentially transformed – by the emerging macro-economic and social trends,” says Mann.  “If procurement is going to take a leadership position within the business, it’s critical that we start planning for this future now.”  

As part of his PEP qualification, Mann and his fellow graduates undertook a module on Futures Thinking.  Led by renowned futurist, Robert Burke, Futures Thinking provides models, problem solving tools and strategic frameworks to anticipate and understand the major trends, threats and opportunities over the medium to long term. Mann reflects: “It was one of the things I enjoyed most about PEP – Futures Thinking is about building your organisation's resilience and converting change into opportunity.” 

For their final assessment, Mann’s syndicate team tackled the subject of how procurement will add value in the year 2032.  “Our aim was to consider the emerging trends and provoke a discussion strategies that will be required to deliver new and innovative kinds of value over the coming decade.”

According to Mann and his PEP team, there are four key trends that will transform procurement as we know it: 

1. Outsourcing – As businesses focus more and more on core competencies, outsourcing will explode including outsourcing of transactional procurement activities, such as POs and category management of non strategic spend. 

2. Data Transparency – Online communities, global trading networks and faster broadband will provide full spend, risk and performance visibility and make information quicker and easier to access.  

3. Collaboration – Facilitated by technology and an increasingly level of comfort and willingness to network and share intelligence, peers will connect, collaborate and share best practice. True B2B connectivity will flourish. 

4. Holistic Experience – Professionals possessing broad, deep, global commercial expertise will be prized by businesses seeking a competitive edge. Those combining financial, risk, supply and sales & marketing nous, with leadership ability will reach the top.  

Based on this outlook, the Procurement 2032 syndicate considered what CPOs of tomorrow will look like – in terms of their skill sets, education, background and tenure, and what this will mean for the recruitment; the retention and development strategies businesses put in place. 

“In 2032, I think procurement teams will still comprise a mix of career professionals, and those with operational experience,” says Mann, adding: “More critically, they will need to be consummate facilitators to realise the value of 'ideas' trapped inside their supply chains.” 

Mann also expects that as more and more of today’s CPOs move up the corporate ladder, some taking on CEO positions, procurement will be championed at the most senior levels.  Mann:  “This will not only impact the perception of procurement as a savvy, global profession, but the function’s scope and reporting lines will shift.”  

Confirming the already noticeable trend towards automated sourcing technologies, Mann believes that functional procurement skills such as sourcing, ordering and P2P, will be less valued. “One of the greatest changes will come from the explosion of the eMarketplace,” predicts Mann.  “Imagine if a business like the Anklesaria Group merged with Google - procurement professionals would be readily aware of what things 'should cost' and price would become far less of a differentiator.” 

On the concept that procurement’s role will be part of a much larger job to facilitate innovation, Mann says:  “As there is a shift from cost to profitability, procurement professionals will increasingly be hired by and sit within an integrated supply chain, not with the end buyer.”  Mann goes so far as to predict that procurement professionals may actually sit on-site with suppliers as strategic partners embrace a true ‘open book’ relationship.

“Procurement 2032 was never intended as an authoritative outlook,” says Mann, “Simply a starting launch pad for thinking about where procurement can and should be setting its sights twenty years from now.” 

Learn more about The 2013 Procurement Executive Program at an Information Night hosted by Faculty and Melbourne Business School.  Attendees will mingle with graduates from the 2012 program and hear from a panel of speakers, including Ron Brown, GM Supply & Logistics, Newcrest Mining, Simon Rabl, Director – Operations & Process Assurance, Procurement & Corporate Services, Telstra, and Dr Karen Morley, Executive Coach, Karen Morley & Associates, on 'Procurement 2032'.

When: 20 March 2013

Time: 5.30pm

Venue: Melbourne Business School (200 Leicester Street, Carlton, 3053)

Drinks and canapés will be served.

Register for the Information Night here