Sourcing and Procurement Focus: Our Weekly Feature Article on Topics of Interest to Sourcing and Procurement Professionals or Related Supply Chain Functions  

- September 8, 2010 -

Supply Chain News: The Category Manager and the New Skill Requirements for Procurement Professionals

Survey Finds Broad Changes in Procurement Skills that will be Needed by 2015; Knowledge Bottlenecks are an Issue



SCDigest Editorial Staff

SCDigest Says:
Just four of the top 10 rated skills (listening, category study, market knowledge, and integrity) were on the list for both 2010 and 2015.

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There is widespread professional agreement that the skill sets of today's and tomorrow's procurement managers need to evolve rapidly to succeed in a growingly complex supply chain world and to meet the growing expectations of companies for their procurement function.

According to recent research by Kay Bayen of the European Institute of Purchasing Management (EIPM), businesses will need more procurement professionals capable of stepping into the role "category manager" and capable of thriving in a matrix-style reporting structure.

What is a category manager, exactly? According to Bayen and EIPM, a category manager is defined as “someone who is in charge of defining a strategy for the [procurement] category, a market intelligence expert of this category and who is capable of communicating this strategy for implementation at regional or global level. This person should work upstream in a cross-functional/cross-organizational manner to influence important decisions while being fully up to date on important input from internal and external sources in order to define strategy.”

Some executives are concerned about the availability of talent to meet these new skill demands. Bayed talked to one procurement VP who said, "There are many people who can perform operational sourcing but few people are skilled at managing supplier relationship management and strategic sourcing.”

That will take professionals with a broad mix of skills, Bayen says, noting that "This means that the category manager position with dotted line reports, mainly lead buyers, requires functional expertise as well as managerial expertise – hard, technical skills as well as softer, people skills."

We'd add strong financial analysis skills, broad supply chain thinking, and a few others into the mix.

Another executive told Bayen that these emerging roles may not even nominally reside within the Purchasing or Procurement organization.

“We call this a value-orientated role. This person may not even belong to purchasing; in fact they shouldn’t be working within a functional silo," said one executive. "Instead, the person should be a ‘process owner/expert’, someone who supports various functions and is at ease with complexity and ambiguity."

(Sourcing and Procurement Article - Continued Below)




What Skills Will be In Demand?

EIPM conducted a quantitative survey asking procurement executives were most needed in 2010 versus the skills expected to be need by 2015.

As shown in the chart below, just four of the top 10 rated skills (listening, category study, market knowledge, and integrity) were on the list for both 2010 and 2015. Six new skills made the top 10 for 2015, ranging from abilities in strategic thinking to change management.



Source: European Institute of Purchasing Management and CPO Agenda


Taking another look at the same issue, Bayen also notes other EIPM research that has identified the procurement skills that have the largest gap between the average procurement manager and the leaders in each skill based on more than 1000 assessments of individual procurement managers. Those are with the biggest delta are:

  • Project management
  • Market industry knowledge
  • Total cost of ownership
  • Value engineering and value analysis
  • Supplier market analysis
  • Payment conditions
  • Financial analysis of suppliers
  • Supplier relationship management
  • Budget setting
  • Decision taking on make or buy

Not surprisingly, Bayen observes that most companies are not doing enough to develop procurement talent within their own organizations. That comes not only from lack of focus and resources put towards talent development, but also "knowledge bottlenecks" that limit the sharing of ideas and best practices within organizations.

Do you think we will see strong emergence of the procurement category manager? What would you add or change to the skill sets for 2015. Of course we need more training and development - will we ever get there? Let us know your thoughts at the Feedback button below.

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