Procurement Challenges Thinking

By Susan Avery

June 18, 2012 at 12:34 PM

Whether managing talent or suppliers, procurement professionals attending ProcureCon Indirect West in Las Vegas recently are challenging traditional thinking.  

Organizations are beginning to view procurement--especially indirect procurement--as a breeding ground for new talent, conference attendees seemed to conclude on the first day of the event which was for procurement practitioners only. Suppliers sponsoring ProcureCon Indirect West joined the sessions scheduled on days two and three. 

This new view or recognition of procurement helps demonstrate the growing value of indirect in an organization. Indirect spend categories are those that help keep an organization up and running.  

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Procurement professionals serving on a panel on Organizational Structure agreed that managing and attracting talent keeps them up at night. Gary Miller, Vice President, Global Supply Chain & CPO at A. Schulman, said that people are a company’s only true asset and that “procurement is an incubator for people” newly employed by a company. 

“From procurement which encompasses all functions, they are able to see the entire organization,” he said, adding that as a CPO he recognizes that people--especially younger people today--will not be working in procurement at the company for as long as people did in the past. He suggested that motivating workers can be a challenge, but that mentoring programs can help both the mentor and the protegee. 

In another panel session on Building a Proactive Procurement Team, Jeff Danis, Vice President of Strategic Sourcing at Pinnacle Entertainment, said that he considers people working in his group who move on to another area of the company “one of the greatest things that can happen.” 

Building on that thought, Wade Lyons, Vice President of Procurement at Teleperformance USA Group, said, “People need to see the opportunity. It creates motivation.” With the support of the company’s HR team, he’s created formal development plans for each member of the procurement team. He’s also a strong proponent of putting together goals and objectives for personnel of a shorter duration of, say, 90 days, rather than one year. 

As for individuals who are not interested in moving up in the organization, he suggests working with them to expand their knowledge of other topics. 

Relationship Building

At a panel discussion on Creating Competitive Advantage Hand in Hand with Suppliers, Jim Niemiec, Vice President, Global Categories, Global Procurement at Hewlett-Packard Company, outlined his team’s structured process for managing supplier innovation and collaboration. 

Asked to name a critical success factor, Niemiec responded with “trust driven by transparency”, and suggested that procurement and its supplier each open their books to one another and provide information on price drivers. 

Lara Nichols, Senior Director, Global Partner Strategies at Tyco, recommended using more propagating models with suppliers to leverage and grow what procurement already has going with a supplier. And to measure that, she said that while procurement “focuses on quantitative--that comes easy for us--qualitative is where we add intrinsic value for growth.”  

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In a case-study session on Fostering Strong Supplier Relations, Erik Rupinski, Senior Manager, Supply Chain at MWV, talked about how his company has structured its supply chain organization into three groups--strategic sourcing, supply chain administration and compliance and supply chain management--which is responsible for managing relationships with suppliers. 

Rupinski told of his having a score card or individual performance plan and how suppliers to MWV do as well. MWV uses the supplier plans to set goals, develop action plans and create tools to measure activity and set strategy. He also explained that supply chain is adapting a supplier innovation event held for suppliers of direct materials to the indirect side of procurement. 

ProcureCon Indirect West also provided procurement professionals with an economic forecast and presentations by some of the event’s sponsoring suppliers. There were also plenty of opportunities to share best practices and to network with others which is the hallmark of ProcureCon conferences. Sessions are shorter and more informal and lack long tedious slide presentations. 

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Norbert Ore, former Chair of the ISM Report on Business, presented a look at Global Market Trends--Impact on Procurement. Using ISM and other economic data, Ore suggested to conference attendees that the nonmanufacturing report needs to grow faster than it is to help create new jobs and that the country probably will not dip back into recession in 2013. 

Nick Vournakis, Vice President, CWT Solutions Group Worldwide, provided conference attendees with a look at Best Practices in Travel Supplier Strategies, and introduced the idea of gamification and its use in helping to incentivize people to use their organization’s travel policy. 

At a Women in Procurement breakfast networking session, Ginny Tucker, Global Leader, Procurement Solutions, ACS, Xerox, led a discussion on work/life balance issues (agree on deliverables and get them done--anything beyond that is beyond that) that quickly turned into a conversation that hit upon such topics in indirect procurement as negotiation strategy--women are more empathetic and better listeners--and the lack of global suppliers for most spend categories. 

In addition to the panels and networking sessions, procurement professionals also led roundtable discussions on certain categories of indirect spend such as MRO & Capital Equipment, Marketing, HR Benefits, Energy, It, Contingent Labor and Logistics. 

Sponsors and exhibitors included Agile-1, Ariba, Carlson Wagonlit Travel, Combinenet, Consol, Corbus, Coupa, Emerset, IQNavigator, Proxima, SciQuest, Summit Energy and Wheels, Inc. 

Next up for ProcureCon is its ProcureCon USA event (concentrating on manufacturing and the direct materials spend) on October 15-17, 2012, at the Hyatt Regency in Atlanta, Ga. On November 12-14, ProcureCon offers a brand-new event on Digital and Marketing Services on the West Coast. 

Its next conference on indirect procurement, ProcureCon Indirect East, is scheduled for February 2013 in Atlanta, Ga. For information on all these events, please call 646-200-7530 or email ProcureConID@wbresearch.com.  

See also: ProcureCon Examines World of Procurement 

See also: Indirect Procurement: Think Like the CEO

 

   

 

 

 



Tags: Professional development Strategic sourcing Supply chain management Procurement Indirect procurement
Category: News Article

Susan Avery

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Susan Avery is Editor-in-Chief at My Purchasing Center. She writes articles, blogs and white papers and manages and creates other content for the online procurement and supply management publication. She produces and moderates roundtable discussions, podcasts, webcasts and video interviews. Susan has 30 years experience covering procurement and supply management for Purchasing magazine and Purchasing.com. 


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