7 Habits of High Functioning Procurement Professionals
The primary role of a great procurement professional is to purchase goods and services with the best possible combination of quality, service and price. Because the procurement process is so widespread and involves many moving parts spanning across an organization’s departments and functions, this is no easy feat. I’ve been thinking about what we’ve learned from so many of our customers over the years. What are the secrets to procurement professional success? Turns out they’re not really secrets at all, but rather habits that we see repeated from our most successful organizations. Here are the top seven habits of high functioning procurement professionals:
- Be a team player. Although it may sound cliché, there’s a reason teamwork is number one on the list. A procurement professional should serve as a steward, making sure day to day needs of the group are met and that the lines of communication are open. Teamwork also means working with other departments, especially accounts payable. If these two groups work hand in hand better – the entire vendor and supplier relationship can run more smoothly.
- Keep the big picture in mind. How do we save money in the long run? By spending it. It’s really true. It’s important to make sure the right people and the right processes are in place to keep things moving and meet organizational goals. Supply chains are becoming increasingly global, and as products and requirements become more complex, companies need to create diverse sets of options and logistics arrangements. At the same time, it’s becoming impossible to ignore big data. Procurement professionals can leverage analytics tools to track supply risks, commodity price trends, and anticipate supply patterns. Investing in analytics and global solutions will allow procurement professionals to stay competitive and perform better in the long run. Look at the industry; look at the data; and make smarter business decisions with that in mind.
- Make fiscally responsible decisions. As reported in Spend Matters, “It’s about working smarter with a procurement policy that provides accessible, accurate, and real-time data by which to base one’s decisions. It’s about having a procurement platform that was designed for modern business.” With massive datasets to scale, making fiscally responsible decisions isn’t just about staying within a strict budget, but about gaining insights and finding value with the appropriate analytics tools. The ability of JAGGAER’s Spend Radar spend analysis solution to collect and classify data from across an enterprise’s many systems of record, provides a means for procurement professionals to analyze spend and identify priorities for bidding and sourcing activities.
- Understand what your customers need. For example, do we really need more pens if we’re all using laptops? Materials can really add up when you consider indirect spend, like a box of pens, accounts for approximately 50 percent of a company’s purchases, according to The CAPS Center for Strategic Supply Research. Monitoring indirect spend is less rigorous because it’s more difficult to control. Typically, it involves multiple individuals in a variety of roles across an organization, as well as multiple suppliers. To optimize indirect spend and see significant savings, the procurement process should be automated and standardized across the organization.
- Maintain good supplier relationships. This marriage is crucial. As the procurement professional, you need to know where to save money and work through contracts. Use established supplier relationships to leverage better prices, be courteous and fair, and pay in a timely manner. Not only will this help you achieve supplier excellence, but let’s not underestimate word of mouth. A happy supplier is likely to communicate their positive experience working with your procurement team, which could lead to new sourcing opportunities.
- Practice good negotiation skills. You have to be good to get the best prices, and negotiation skills are necessary to drive better results to the organization’s bottom line. In today’s competitive global economy, the scope and significance of negotiation can involve intense, high-stakes interactions affecting multiple parties. When facing these complex situations, negotiators need highly developed skills and strategies to help them navigate the waters.
- Embrace technology. Always look forward to where the industry is heading. What works today may not work tomorrow, which is why at JAGGAER we are constantly striving to improve our cloud-based business automation software technology. With major enhancements to supplier onboarding and management, advanced sourcing, chemical inventory management and reporting, the most recent release of our Total Supplier Manager solution for supplier lifecycle management demonstrates our commitment to creating cutting edge, easy-to-use business automation software for a seamless user experience.
These are the seven habits of procurement professionals we like to promote here at JAGGAER, but we’d love to hear any others you use. Please feel free to send us your tips on Twitter at @JAGGAER. To learn more about JAGGAER eProcurement, our two minute video will get you on your way.
[Image: Andy Maguire via Flickr]