Procurement Performance & Development

How to build an effective procurement team in 10 steps

Procurement is in the middle of culture shift. Agility, analytics and interpersonal skills will be needed in the future to address new requirements. Learn how to build a procurement dream team.

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Updated: Aug 22, 2023

There used to be a saying that the brightest person would be assigned to product development, the most talkative to sales, and the one that could do nothing else would do purchasing.

If you ask Procurement, it's quite the opposite! The attitude towards Procurement has changed in organizations. 

There is a workplace culture shift going on in Procurement. Procurement teams have come a long way to earn their position as value-adding business partners that use spend data as a conversation starter and superpower.

Now, Procurement is seen to have a high business value contribution in opposite to function that only acquires products and services at the right time at the right place.

Procurement as a work environment

Procurement is a high-demand, fast-changing, and hybrid work environment. Reactivity and agility are needed when the supply chain needs to adapt quickly. Procurement professionals want the best tools that support their proactive way of working and taking action when required.

Procurement has always been hybrid in that work is done while traveling to meet with suppliers and visit sites. Now that supplier relationship management (SRM) is done in distance due to pandemic travel restrictions. Procurement is more at home and the office than ever. This provides a unique opportunity to zoom out and focus on the essentials.

Customers and stakeholders require sustainability and accountability from the supply chain. This demand for corporate responsibility lands on procurement eventually. 

What is driving the culture shift in procurement?

The type of skills, tools, and mindset needed in the future is changing. Technical development is impacting the working environment. There is growing pressure for agility in the dynamic procurement domain.

We can see a transformation in the generation of practitioners, coming from a high substance knowledge culture to a generalist culture with wider access to data.

There will be a need for professionals with long careers and vast substance knowledge as well as the younger tech-native generations.

Classification and procurement insight requires true silent knowledge. However, a big part of the insight generation knowledge can be taught to AI later and automated, however. Automation enables focus on human-to-human collaboration and strategic development.

 

Technology and data enable the culture shift

The role of technology is essential for enabling a positive culture shift. Without suitable solutions, there is the will but not the way.

Procurement professionals seek a culture where they best can express themselves professionally. The best tools save time from repetitive tasks, free time for human-to-human collaboration, acting on insights, planning, and strategic thinking.

Data and analytics enable insights and provide vision. With data and analytics, procurement is shifting towards a low hierarchy, empowered, and autonomous culture, with no specific data analyst capabilities needed.

Bottlenecks are reduced as professionals have the data they need for fruitful stakeholder collaboration. Tools and data should add speed and agility, not the opposite.

 

Culture shift as part of our solution offering

We hope our customers can also resonate with our laid-back culture and ways of working in a cultural sense. We tend to avoid the stiff corporate culture and ways of working. Hence, working culture (and the transformative aspect of it) is part of our analytics solution value offering.

Traditionally procurement has used time in collecting, enriching, and analyzing data - now, automated analytics can do this while people can focus on insight generation and acting on insights. We know data is the new oil, and the amount of data is expanding lightspeed. A human can’t manage all this data manually and keep themselves informed of everything.

Giving people the best-of-breed analytics solution so they don’t get frustrated with the information float is key to creating effective and well-working teams. Creating clarity and simplicity in an information-filled world is a must for professionals to operate.

We believe data and analytics must be understandable and approachable.

 


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How to build an effective procurement team in 10 steps

In light of the changing procurement culture and new tools, here are 10 steps you can take to build an effective Procurement team. 

 

1. Invest time in the recruitment process

Focus on ensuring people fit in terms of motivation and skills that complement the pre-existing team.

 

2. Respect your team members as individuals.

Get to know your team personally and help them clear out obstacles in their way. Take an interest in their thinking and decision-making processes.

 

3. Establish clear expectations from the beginning

Ensure your team understands their role, responsibilities, and license to operate.

 

4. Diversify

Different backgrounds, ages, experiences, and opinions will help your team make more informed decisions.

 

5. Build connections within the team.

Enable people to collaborate, share information, and leverage best practices actively. Facilitate cross-organizational collaboration.

 

6. Train your emotional intelligence

High emotional intelligence leaders are aware of how their emotions impact their teams. They know how to motivate and build confidence in others. They are aware of their strengths and weaknesses and are at ease with sharing responsibility.

 

7. Communicate, communicate, communicate

You can never be too good at communication with your team and stakeholders.

 

8. Positive enforcement

Positive reinforcement is effective in shaping behavior. Compliment in public, give credit for great work, and celebrate the wins. Recognize not only hard cost savings but also the broader procurement contribution.

 

9. Look for ways to reward good work

Great leaders understand that not everyone is motivated by the same thing. Find out multiple ways to show your team member's effort is appreciated.

 

10. Data and tools

Give your team the solutions and data they need to succeed in what they are doing. Enable strategic focus and efficiency with automation of repetitive tasks.

 


Final thoughts

Nurturing and leading change is critical to enabling the team and keeping everyone engaged. You should not forget the needs of the existing employees with long careers and vast knowledge.

Recruiting people with culture in mind can drive the wanted change and natural transition. Seeking profiles that bring the best out in the whole team enables culture change and growth.

A forward-looking and open-minded attitude is a must for procurement in transition.

There is no right or wrong type of organizational culture. The “right” culture aligns with company culture and employee values. 

Procurement is a people business. Creating corporate policies and value statements is easy, but concrete actions and decisions show the real culture and company values. It's easy to buy software, but how people use and benefit from the solution speaks for the actual value-add.

Procurement organizations are as unique as the companies they operate in.

 

About the author

Atro Ranta-Aho is VP of Value Enablement (Customer Success) at Sievo. He holds commercial responsibility for Sievo customer base of 120+ customers in over 40 countries. Atro is a former procurement practitioner before joining Sievo over 6 years ago.

 

 
Header photo by Alex Braga (unsplash.com)

 

Atro Ranta-Aho

Atro is VP of Value Enablement, Customer Success of Sievo with a vast knowledge of procurement.

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