22 SEP 2015

Making savings stick across Asia

Since the last Faculty Quarterly, The Faculty team has had the pleasure of holding extensive conversations with leading Asian CPOs and facilitating a roundtable discussion that focused on the region's unique procurement challenges.

A recurring theme that came out of our discussion in Singapore was the growing focus being placed on instilling an organisation-wide cost conscious culture. Echoing the findings of our latest research project “Making it Stick”, CPOs highlighted that only once a solid cost saving culture had been put in place, could they begin to address the more strategic elements of their role.

One Singapore based CPO stated:  "If you’re in procurement, you’re always going to be judged on cost savings, get over it! Work hard to get that secured across all territories, prove your worth, then you can start on the ‘sexy’ strategic stuff."

As the comment above reflects, the challenges of implementing a cost conscious culture in Asia, a region of great cultural and geographic diversity, can be great. Some CPOs we spoke to were responsible for implementing change programs in 12 distinct territories, each with its own language and business customs.

Max Goonan, Networks Director at The Faculty, commented on this challenge, claiming “CPOs in the region increasingly have to understand the nuances of cultural backgrounds in order to deliver peak performance in culturally diverse teams. It is a constant challenge for them.”

As our latest research outlines, a cost conscious culture is a building block for any transformation program. This point was highlighted eloquently by one of the Asian CPOs during the Singapore Roundtable discussion.“Two things are critical to change – your cost base and nurturing your culture. In this region you need a unique skillset to build on these initiatives and ensure that they underpin the global business strategy and ultimately create an all pervasive cost-conscious culture” he said.

Dr Tom Verghese (an internationally renowned consultant, presenter, executive cultural coach and author) led a dynamic interactive session that dove into the cultural challenges that organisations in Asia face. The sessions focused particularly around difficulties of instilling a common business culture across a region with so many separate customs and languages.

Tom discussed the importance of understanding the role that culture plays in influencing Emotional Intelligence across the region. He highlighted that cultural influences in different regions have a marked impact on the way staff carry out their work.

Many CPOs report they had experienced, first-hand, how Cultural Intelligence extends beyond Emotional Intelligence sensibilities. Leaders who understand this dynamic will be dramatically more effective in interacting with stakeholders and staff members from different cultural backgrounds. The theoretical approach Tom provided helped CPOs to better understand the challenges they faced when it comes to instilling a cost conscious culture and ensuring that their savings stick.