Time to broaden how we think about purchasing capability.

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"You are only as good as your team" is an oft-quoted phrase and something that procurement chiefs have taken to heart as their personnel numbers have grown.


Each and every year procurement chiefs say that one of their key priorities is to improve the skills and capabilities of those in their team. Understandably this focuses on those who sit under their direct jurisdiction, but 2014 should be the year that this mindset changes because purchasing capability extends far beyond the four walls of your own offices. 


Businesses need to consider themselves as a part of the value chain and, through that lens, really try to understand how other business’ capabilities affects their own. 


In this way, the performance of a supplier’s purchasing team is key contributing factor to the success of its customers’ procurement function; whether this is through more efficient sourcing, improved corporate social responsibility, delivering new innovations or effective risk management. If any part of this fails both the customer and supplier suffer - by the same token, there’s opportunity to improve value by improving supplier’s performance. Not easy - but some bright teams are proving that there are simple ideas that can be effective: collaborating with suppliers on training programmes.


Some may think this an unlikely arrangement - its certainly not common practice - but the mutual benefits of doing so mean surely make it worth considering. Supply chains are more complex than ever and stretch into risky places where their vulnerabilities aren’t necessarily understood. The more skilled the people who work within your supply chain are, and the better that your business understands how they work, the greater potential to share best practice on managing these risks, draw new innovations out of the supply base or indeed cut costs through improved negotiation techniques.


Where, then, to start? An assessment of who is using what kind of training programmes and how these might be aligned or improved needs to happen first alongside a conversation about how comfortable everyone is with collaborating in this way and the benefits of doing so.


It may well be decided that the different programmes can’t be aligned, though even then there are still ways to do so. It can be something as simple as sending buyers, analysts, senior sourcing/supply chain executives or even the CPO themselves to host a session in which they share their best practice tips.   


In a world where collaboration is common between customers and suppliers this isn’t too much of a leap of faith, but is the next step in ensuring that you and your whole team is as good as it can be and is delivering increasing amounts of value back to the business itself.  

Tim Burt
Posted by Tim Burt

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