Procurement has changed – but how do you convey this to people outside of the function? With the profession more central than ever to an organisation’s overall value proposition, it’s time to level up how you market yourself to internal and external stakeholders.
While the pandemic raised awareness of supply chains and the level of skill involved in procurement, there are plenty of other factors accelerating the function’s transformation: the climate crisis and the growing importance of sustainability, disruption wrought by Brexit, cybersecurity risks (more so now due to Russia’s war on Ukraine), and the need for cutting-edge technology.
As recent Heidrick and Struggles report Resetting the role of the chief procurement officer puts it: “Procurement professionals need to step out of their comfort zones and project a renewed image of the function that focuses on its growing, more strategic impact on value creation.”
Communicating that image effectively requires a new depth of knowledge – of your supply chains and business, says Nationwide CPO Imran Rasul. “The board is asking about supply chain resilience – whether suppliers will be able to keep providing services during the energy crisis, for instance,” he says. “We need to understand these macro events and have insight into the supply chain so we can arm our stakeholders. These are new questions of businesses. There’s space to fill that gap, but it requires different thinking.”
Have a clear value proposition
This different thinking translates to an elevator pitch with far less focus on costs, despite the severe financial pressure many organisations find themselves under as they rebuild post-pandemic. “Cost still has its place but it’s much more about ESG, doing responsible business and talking about how your relationships are securing your supply chain,” says Karen Mansell, a former procurement executive at pharma giant Bayer and now CEO of Accelerate Procurement.
“When you get trapped in the lift with the CEO, they aren’t going to ask you how much money you’ve saved this year but about Scope 3 emissions regulations, sustainability and how you are contributing to the whole company value proposition.”
Investors are also increasingly interested in supply chain issues and environmental responsibility, again making procurement a board-level issue. “There will be shareholder activism if you are not taking action on the environment,” warns Mansell. It’s a compelling message for any procurement professional to remember when selling the value of the function.
When it comes to the pitch itself, one of the most important things is to give it plenty of thought in advance, advises Chris Emberton, procure-to-pay director at law firm Clifford Chance. “Some people just wing it, but you need to have a clear value proposition for your function. Make sure everyone on your team is clear on that elevator pitch so that they can articulate it on your behalf.”
Find that one golden nugget
There is no one-size-fits all for the pitch, as every stakeholder will have a different priority. “You need to align the key parts of your value proposition that resonate with each person,” says Emberton, adding that he has “about five” elevator pitches depending on who he is trying to convince, each with a different lead, whether it calls for risk, innovation, sustainability or so on.
“You need a soundbite,” agrees Mansell. “Procurement isn’t a subject everyone gets excited about, but find that one nugget and people will get excited. Get to know your stakeholders and what pushes their buttons.” She recalls working with one head of R&D who had a negative and old-fashioned view of procurement. “I developed a pitch around how many more clinical trials he could run with the savings. It wasn’t about taking the savings away, but reinvesting. What if you could have eight projects instead of five? That’s not about procurement, it’s about telling a story. Storytelling is key: being able to get your message across authentically with a certain degree of passion.”
The world might be lurching from one challenge to the next at the moment, but it is an opportunity for procurement to add more value, to change organisations for the better and improve its standing within businesses. “There is always some crisis to react to,” says Rasul. “It’s about showing the business we have the data and market insight at our fingertips to allow them to make good decisions.”
