Procurement is changing, are you ready?

Cpl’s Talent Evolution Group partnered with the Chartered Institute of Procurement & Supply (CIPS) at their recent CIPS Futures Conference in London. The conference provided a clear understanding of the challenges and opportunities facing Procurement and Supply Chains. The procurement teams of the future need to adapt and change, given the key transformations from the last 5-10 years.  

Now, more than ever, procurement is at the heart of driving and delivering organisational strategies across AI, ESG, customer satisfaction, and more.  

New employees to these organisations need to bring skills that support these new priorities; such as the analytical skills of a Financial Analyst, the negotiation skills of a Sales Director, and the emotional intelligence of an HR leader.  

While there are many factors impacting supply chains, there are four primary areas of focus for procurement leaders to keep an eye on:  

Local supply chains are best – and less of a risk. 

Geo-political conflicts, energy and transportation costs, and high interest and inflation rates continue to create uncertainty. Although challenges remain, supply chain volatility is showing signs of improving. 

GEP/ S&P Global Supply Chain Volatility Index shows that 2023 saw a decline in general demand for goods and services and many of the supply chain issues have started to disappear, mainly due to global fiscal policy.  

The nature of supply chains is changing, as consumers hold companies accountable for their entire supply chain with a much higher focus on ESG. Price is no longer the only factor consumers are considering. Human rights, carbon footprint, and extreme weather are all starting to impact buying decisions. Supply chains must react with local and regional buying strategies designed to protect the costs and availability of future supply chains, building in resilience on everything from Cyber-attacks to geopolitical conflict.  

Organisations are realising the potential of Artificial Intelligence. 

According to the recent Pulse Survey from The Chartered Institute of Procurement & Supply (CIPS), 65% of procurement teams are investing heavily in AI. The future development of procurement and supply chains will be increasingly driven by big data, enabled by machine learning and AI analysis. These new tools will accelerate human productivity and output, significantly impacting costs and providing time savings.  

The use of AI tools will provide better information on supply chain resilience, such as the performance of suppliers or the impact of legislation.  

Emerging digital tools provide greater low code/no code agility than cumbersome Enterprise Resource Planning (ERP) systems and better connectivity between solution software and data. 

It is time for organisational ESG to step up.  

The development of AI technology and the reshaping of supply chains have made sustainable success more attainable. Businesses have found it hard to stay competitive and agile with so many competing priorities and stay true to their ESG goals.  

However, AI helps companies have greater visibility into their suppliers. Changing buying strategies can also help to mitigate some of the external factors that have impacted organisations during and post-pandemic.  

Improving the focus on ESG will help companies build resilience and ESG will continue its trajectory at the heart of risk, financial, and performance frameworks.  

4. Evolving talent requirements  

Is there a new war for talent?  

The transformation of procurement and supply chains is changing the talent mix that teams need to function. Data is now more available than ever before. Understanding how to make the most of AI tools and determine the impact on automation and digitalisation will be critical to the success of the next generation of the procurement function and across all business functions.  

With the decline of supply chain volatility, new digital technologies and AI will increasingly transform how procurement and supply chain teams operate and focus on data. This data-focused approach will help organisations build greater resilience and align their supplier network to shared supplier ESG values.  

Finding, developing, and retaining talent with the new skills required will be key to sustaining competitive advantage and growth.

Interested in learning more about how Cpl's Talent Evolution Group can support your organisation to ensure your procurement function is future-ready? Schedule a consultation to learn more.