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Procurement Leaders is about to launch its 2013 instalment of the salary survey. It details the remuneration packages of purchasing professionals by differing job titles, geographic location and industry sector.
One of the aspects that we were interested in investigating the effect of educational attainment on the earning potential of executives. Firstly, we confirm the conclusions drawn in conventional economics of education that salaries increase incrementally for each higher level of qualification earned. This effect fades away at the level of doctorate, which delivers relatively lower wages that preceding level of qualifications.
Part of this may be due to the level of specialisation that this required of operations-focused positions, like those in engineering, which historically act as a talent pool for procurement. From there, individuals go on to act as buyers or category managers and wield their technical knowledge to maximise their company’s position in a given market. However, there is some evidence from our survey that this may be limiting to their career.
Progression to the highest salary levels within an organisation does not require detailed knowledge of a specific industry, but a broad breath of management and commercial skills.
There is much talk within the profession that its senior management tend not to come from within procurement. Indeed, one organisation that we interviewed spoke of a rough rule of thumb, whereby 80% of its category managers were deliberately recruited from other functions. The assumption being that buyers did not have the capabilities to develop the commercial acumen to management an important global category.
Our data shows that this is not a common feature of procurement’s senior leadership. CPOs come all backgrounds: some have worked in procurement for their entire working career; others have recently joined the function. There is no preferred recruitment method.
As such, it is possible for buyers to move onto the highest earning salaries, but they must be career as to the track that they choose. Specialisation, technical knowledge naturally caps earning potential. The ability to perceive and seize commercial opportunity and to influence others are vital skills to enhance to the upper echelons of management.
Undertaking qualifications that provide these broader skills should therefore provide more RoI than those that deeper knowledge in a single area.
You can download a summary of the results of our Salary Survey here.