Based on interviews with 11 highly respected procurement leaders across various industries in Europe and Asia, Heidrick & Struggles reveal the key changes and drivers emerging as the role of the Chief Procurement Officer resets.
The CPO’s role has undergone fundamental changes over the last few years.
Data-powered technologies, digitised work, evolving supply chains, extreme disruption and critical topics of sustainability and risk management are driving CPOs to adapt rapidly.
Whilst procurement has previously been focused on process efficiencies, cost control and compliance, value-creation is now more focused on digital innovation and ESG elements where CPOs are encouraged to engage with external stakeholders more regularly.
“When it comes to ESG implementation, it is often down to procurement to make it happen with suppliers,
which involves significant effort and resources.”
Cyril Pourrat, CPO at BT
Procurement’s strategic importance has increased, therefore the role of the CPO is also changing to match its dynamic environment including critical competencies, leadership traits and succession planning.
91% of businesses cannot stay ahead of their supply chain complexities. This leaves room to future proof CPOs so they can tackle these issues strategically, which means providing them with new skill sets and leadership approaches:
- Inclusive and purposeful
- Willingness and the ability to experiment and innovate
- Ability to influence at board level
“Following the evolution of the procurement function, CPOs will have to be strategists first and functional leaders second.”
Dave Ingram, CPO at Unilever
Emerging strategic drivers for the CPO:
- expansion of the procurement ecosystem
- the increasing importance of sustainability as a strategic initiative
- acceleration of digitization and emergence of new technologies
- supply chain rising to the board agenda
“The CPO can become a key partner to many parts of the organization by bringing
digital innovation to the business—for example, in the form of platform buying and advanced data analytics.”
Jane Liang CPO, British American Tobacco
Whilst it is an ongoing process, the role of the Chief Procurement Officer holds much responsibility and potential for companies to thrive as they tackle extreme disruption. Finding and building the right talent is key, where ‘today’s challenge is to think about the CPO of the future—but tomorrow’s will likely centre around the future of the CPO.’