As has been noted in prior Supply Chain Matters blogs and our predictions for the current year, the role of procurement leaders, both in large and smaller enterprises, will further evolve in 2017 to include more strategic advisor skills. Such skills will include analyzing the impacts to a rapidly changing global supply chain sourcing picture, added supply chain risk factors, and needs for higher levels of joint product and process innovation among suppliers, trading partners and services providers.

Candidly, beyond being a prediction, procurement as a trusted business advisor is a statement of compelling need documented by performance studies.

One widely recognized study comes from a collaboration among A.T. Kearney, The Institute for Supply Management (ISM) and the Chartered Institute of Procurement and Supply (CIPS) who since 2009, jointly conduct the Return on Supply Management Assets (ROSMA) Performance Check Study. The latest 2016 report, What Good Looks Like, brings forth a number of findings and insights derived from over 2000 executives from multiple organizational dimensions. The study continues to point toward the existence of wide performance gaps among procurement organizations. A top-quartile group of elite performers consistently deliver more than $1 million in financial benefits per procurement employee and report the highest levels of value creation from advanced sourcing methods. Yet, the study continues to point a widening gap to middle-tier performers that deliver some value, and a far larger group of bottom-quartile performers that add limited value to their organizations.

Highlights of the report’s takeaways note that while principal stakeholders (C-suite, finance, and lines-of-business) are aware of and understand procurement value drivers, performance variance remains large across various cross-industry and organizational size value drivers. In essence, the gaps among top-performing procurement and all other procurement organizations are growing wider, and that compels a need for remediation.

Once more, ongoing business challenges and events continue to evolve at a far more rapid pace. If readers have been keeping-up with business headlines these past weeks, there were many signs of reinforcement.

In the healthcare sector, personalized medicine is poised to disrupt the future of drug manufacturing and the risks associated with a lack of visibility will be compounded as personalized medicine necessitates an even more intricate network of supply chain partners, creating a web of manufacturers and distributors that procurement organizations will need to monitor.

We featured announcements where semiconductor and software companies are increasingly becoming new strategic suppliers to automotive and track producers for innovations in on-board electronics, enhanced safety, autonomous driving, and driver productivity focused technologies. In its 2017 Environmental Update Report, Apple made a commitment toward implementing a closed-loop, totally sustainable materials supply chain predicated on materials and process innovations across the supply chain. For global apparel supply chains, we featured a guest blog posting which described how third-party refurbish services providers assist brands in remediating offshore production glitches or quality snafus. Just this week, in conjunction with reporting its latest financial results, aircraft producer Boeing indicated that over the coming months, it will re-analyze its overall supply chain sourcing strategies to explore further opportunities for added cost savings by bringing some production in-house.

From our lens, the above are just a sampling of events ripped from the headlines that imply that procurement indeed has opportunities to be judged as trusted business advisors.

The question remains, do procurement leaders and their organizations have the broader management skills, cross-functional knowledge, and technology enablement skills to address such needs in a timely manner.

In just a matter of weeks, ISM will be conducting its annual 2017 conference which will be held May 21-24, 2017 at the Disney Coronado Resort in Orlando Florida. Featured keynote speakers will include former UK Prime Minister David Cameron, and former Chairman of the Joint Chiefs of Staff, General Colin L. Powell, USA (Ret.).   

A total of 73 sessions will be offered based on various skill development levels ranging from fundamental to mastery level. Learning tracts include Economic, Business and Professional segments along with various Experience segments including the very successful Emerging Professionals Experience sessions.

Please consider joining this supply chain industry analyst in attending ISM 2017.

The full agenda and registration information for the ISM 2017 Annual Conference can be obtained by clicking on this dedicated ISM 2017 conference web site link or by clicking on the conference logo appearing in our Upcoming Conferences panel to the right. Readers should take note that if you register before the end of April (in just two days) you can still take advantage of a $200 registration discount, so consider acting sooner than later.

Bob Ferrari

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