Procurement’s New Top Priority
Procurement organizations are clearly getting the message that they need to demonstrate their value, in the same way they've documented spend savings for nearly a decade.
As noted in our news section, The Hackett Group’s latest procurement research contains some revealing new trends. Here’s what Global Managing Director and Procurement Advisory Practice Leader Chris Sawchuk found the most compelling:
It was fairly surprising to see that cost reduction fell to the fourth priority, after eight years in the top spot. Clearly, the priority of procurement for 2014 is to support innovation-driven revenue growth, and finding ways to enable that trumped the historic focus on cost reduction. We’ve been expecting to see this switch. But it’s surprising that it happened so abruptly, and in such a dramatic fashion.
In this context, it wasn’t that surprising to see that procurement’s top priority became expanding its scope and influence. After so many years of driving down costs in the same areas, the only way to continue to make progress is to expand into new areas.
It was also very interesting to see the focus on reinventing procurement’s value proposition. Procurement organizations are clearly getting the message that they need to demonstrate their value, in the same way they’ve documented spend savings for nearly a decade.
About the AuthorPatrick Burnson, Executive Editor Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at [email protected]
Subscribe to Logistics Management Magazine!Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.
Start your FREE subscription today!
Q4 2017 Rail/Intermodal Roundtable: Improvements apparent; work remains LM Viewpoint: Collaboration, Now more than ever View More From this Issue