Procurement's Future Depends On Business' Future

There really is no future of procurement apart from the future of business. After all, you and your team are servants of the business, and thus you should evolve in tandem.

There is an old saying in politics that, despite what’s going on in the world at large, all politics, really, are local. You might say the same is true in business, particularly when discussing the future of procurement.

There is much discussion and, indeed, much writing about the future of procurement (Deutsche Telekom’s Eva Wimmers’ recent piece being a great example). Much of the writing, particularly, has been insightful and thought provoking, as you will see here, here, and here. But when you think about it, there really is no future of procurement apart from the future of business. So, I think it would be well to also add into the discussion the likely direction business is heading, especially in your own industry. After all, you and your team are servants of the business, and thus you should evolve in tandem.

But, what will your business be like in the future? There is plenty written about the future of business in general, and it’s worth studying the predictions to see how they apply locally.

Among insights: Thanks to digital technology, there will be increased connectivity, making collaborative skills more important. Fast Company, a US business magazine, has written about the potential for flatter organizations in the future; new business ecosystems where partners, customers, and competitors will work collaboratively, sometimes alternating leadership roles; and new kinds of strategic partnerships, such as what is evolving in the acquisition by Yahoo of Tumblr, where the acquired company retains its special culture.

Tom Linton, CPO of Flextronics, has spoken of the impact cloud computing will have on business and procurement, as well as the potential for “virtual vertical integration,” and the growth of the concept of corporate social and environmental responsibility.

In the manufacturing world, consultancy Deloitte has written about how a growing materials-resources competition and scarcity will change company resources strategy and result in major materials science breakthroughs. Additionally, the firm says, clean-energy strategies will become more important, and the ability to innovate quickly, already important, will become more critical, requiring infrastructure, investment budgets, and people with the right skills to enable the innovation.

In each of these and other predictions there are implications for procurement. CPOs should be thinking about how those and other potential business evolutions will affect their own businesses, and then figure out how best to mold their own procurement organizations to take advantage of the changes to ensure procurement’s continued value.

It’s no small task, but definitely an essential one.


This article is a piece of independent writing by a member of Procurement Leaders’ content team.

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