6 golden rules for increasing procurement influence

Blog | May 23, 2015

Increasing procurement influence in your organisationProcurement is not always recognised as strategically important. It’s also rare for the CPO to be considered for a vacant CEO position. How can Procurement professionals improve their standing?

Be an excellent communicator

It’s important to make sure you are part of the discussion about company performance, budgeting and forecasting. If you’re not part of the discussion, increasing procurement influence in your organisation will be almost impossible. Think about how you come across and make sure your message is coherent and succinct. Base your communication on your key performance indicators and refer to them frequently.

Focus on value

Everyone else around the board table has plenty to do and little time or inclination to learn the language of procurement. To succeed, you need to demonstrate the value procurement delivers – in language that everyone else understands. If you frame procurement’s contribution with reference to topics such as quality, supplier innovation, risk reduction, working capital and cashflow, you’ll be presenting it other strategic functions.

Understand your stakeholders’ pain

Knowing what stops your stakeholders achieving their goals will help you make sure procurement addresses real problems in your organisation. It will allow you to align procurement with common goals and build trust.

Be clear and confident about procurement’s contribution

It’s important to recognise that procurement serves wider organisational goals. You and your team need to offer ‘customer service’ to the rest of the business but you need to be assertive about how procurement will deliver better outcomes for the business. If departments are consistently working with a limited pool of suppliers, not specifying requirements accurately, not allowing time for negotiation or not creating the right framework for contract management, they aren’t doing the right thing for the business.

Promote the benefits of risk management

Be sure to undertake both formal and informal education about the nature of risk around the procurement process. Often it isn’t a desire to expose the organisation to risk that drives non-compliant behaviour. Recognise that some procurements are riskier than others but show people the unforeseen consequences of their actions.

Build strategic alliances

Identify a person (or people) who are an influence on your stakeholders. Invest time in your relationship with them so that there is someone outside procurement presenting it in a positive way. Ask them for feedback on a one-to-one basis and seek an opportunity to discuss to work better. A good time to do this more generally can be when conducting supplier audits.

Making the rest of your organisation into fans of procurement might not be an easy task. However, building alliances and seeing presenting procurement in the same context as the rest of the business will benefit both you and your organisation.