The Deloitte Global Chief Procurement Officer Survey 2017

August 15, 2017 freighttenderinfo

Growth ambitions are high in an uncertain market, the pace of change and increased uncertainty requires superior levels of funding. Defensive strategies being implemented by Chief Financial Officers are demanding rapid, sustained cost reduction in parallel to a greater focus on risk from procurement. We are now sure that the traditional procurement operating model has to change. This has been driven by a lack of talent and an increase in digital innovation.

The report covers key themes and challenges facing the procurement function with clear incremental and exponential actions to consider. CPOs are supporting growth in uncertain times through continued delivery of cost and cash flow benefits to the business. Chief procurement officers (CPOs) should use high internal business support to build capabilities in value and collaboration, talent, and digital procurement.

  • Value and collaboration: Longer term value levers of supplier collaboration and restructuring of relationships remain at lower levels. Business partnering is strong, but there is a consistent gap in where procurement leaders want to be and an acknowledged lack in the leadership skills to be able to close this gap.
  • Talent: While there is an increased requirement for leadership and digital skills, there is limited change in the investment or approach to close the talent gap. With improvements in technology enabling automation, the skills of the past will not deliver the needs of the future. Organizations should look to attract and develop the next generation of procurement leaders who will act as innovators, challengers, and digitally minded-thinkers.
  • Digital procurement: Three-quarters of respondents believe that procurements’ role in digital will increase. Procurement leaders are looking to overcome key barriers in data and capability in order to achieve significant impact from both their core operational systems and their new digital and analytical solutions.

Key findings from Deloitte’s global chief procurement officer survey

  • Seventy-nine percent of procurement leaders to focus on cost reduction, and 48 percent want to increase cash flow
  • Almost 60 percent see managing risks as a priority
  • Fifty-two percent of procurement leaders are focused on new products, services, and market development
  • Executive support for procurement change exists for 75 percent of procurement leaders
  • The majority of CPOs rate their current effectiveness of business partnering at less than 70 percent and have an ambition for future effectiveness to be greater than 90 percent; 60 percent of CPOs do not believe their teams have the skills to deliver their procurement strategy
  • Twenty-five spend less than one percent of their budget on training
  • Seventy-five percent of CPOs believe that procurement’s role in delivering digital strategy will increase in the future
  • Analytics will have the largest impact for over 65 percent of procurement leaders

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