Procurement’s talent shortage isn’t new information.
Demographic shifts, the Great Resignation and strong competition have meant significant gaps in the workforce for not only procurement but industries beyond too. Although the Covid pandemic is now four years old, its effects are still being felt. Despite signs of stability over the past 12-18 months, Forbes reported last year that turnover rates and inflation remains high while large percentages of employees remain disengaged and interested in making a move.
Procurement’s talent shortage story
It all comes back to demographic shifts. You see, the large Baby Boomer generation have nearly all retired in recent years. This has meant the equally large Millennial generation has moved past entry-level roles and is now filling mid-level ranks. But the smaller Generation Z isn’t big enough to meet the number of entry-level roles. Generation X, while also comparatively small to Baby Boomers and Millennials, isn’t large enough either to fill the leadership gap left by the Boomers.
Indeed, a recent survey of over 100 procurement leaders from research and advisory giants Gartner discovered only one in six procurement teams felt they had adequate talent to meet their future needs. It comes as industry demands continue to grow and evolve amid digital transformation’s ever-growing grip on the function. In the report, Fareen Mehrzai, Senior Director Analyst in Gartner’s Supply Chain Practice, said: “Procurement leaders are generally confident in the current state of their talent and the ability to meet their near-term objectives. However, our data shows that chief procurement officers (CPOs) are worried about the future and having sufficient talent to meet transformative goals based around technology, as well as the ability to serve as a strategic advisor to the business.”
So, how does procurement go about solving the problem?
Procurement’s way forward
Anthony Payne, Chief Marketing Officer at HICX, believes that in order to attract talent, procurement must show it has transitioned from being the ‘spend police’. “To attract talent, Procurement must show that it has progressed away from being the ‘spend police’ and towards a more multifaceted role,” explains Payne. “Modern procurement is at the intersection between a company and its suppliers, which requires a broader skillset. The function has an opportunity therefore to attract talent from different roles, in particular technology – today’s function needs people who can combine tech savviness with procurement and commercial acumen, to get the most out of the exploding tech landscape. Supplier marketing – because companies can no longer simply insist that suppliers comply with any request, they need to engage and encourage suppliers to adopt new tools and ways of working. This will require marketing-type skills.”
While Gemma Thompson, Senior Solutions Advisor at Proxima, believes it is more important than ever before to have the right talent in place. Given the nature of today’s challenges in procurement and supply chain, educating tomorrow’s talent of the long-lasting impact they could have could be key. “These are challenges that align more closely to the younger generation entering the workforce,” she explains. “Increasing opportunities to deliver real value, make a lasting impact, and flex their natural upper hand when it comes to adopting technology. So, why the shortage?
“Once you’re in the procurement world, you understand the strategic direction the profession, progressing from back of house to centre stage. However, it’s lesser known on the outside. Procurement still battles with its flashier counterparts, to cement its position as a true strategic business function and ultimately competes for emerging talent. The solution sits at the cross-section of the procurement capability needed by an organisation, and the career aspirations of those in the field and those considering entering.”
How can procurement become a career of choice?
Thompson adds that there are three ways to empower the workforce of tomorrow into choosing procurement as a career destination. Ultimately, in the modern world, people have greater flexibility around how and where they work while also wanting more from their occupations.
“Align your talent strategy to your organisational objectives: determine what it is you’re seeking to achieve and therefore the capability that you need, for example, you may be consolidating supply to fewer key players and require strong supplier relationship management skills. Developing your strategy around such goals enables clarity in responsibilities and progression for team members.
“Embed adaptability and flexibility in your talent model: CPOs must embrace the increasing trend towards a hybrid procurement team, comprising in-house talent and additional third-party support, whether through a specific-skilled contractor or surge support. Widening the net enables you to access the right talent, for the right purpose, at the right time.
“Invest in the external positioning of the function: if you are seeking leading talent, you must provide the space for them to shine. Have an openness to unique and innovative thinkers, emphasise the soft skills needed to partner with the business as well as the technical know-how, and invest in training that elevates the individual as well as the function.
“Tomorrow’s talent demands more from a job, and it’s up to procurement organisations to offer it.”
Acquiring talent
And Omer Abdullah, Co-Founder and Chief Commercial Officer at The Smart Cube, believes that acquiring talent away from the function could be the answer. “Procurement could acquire talent externally – which means organisations should implement better, and more diverse, recruitment mechanisms,” he reveals. “This includes bringing in people from other business functions. For instance, IT or marketing professionals can bring credible skills that enable strong category management in their expertise areas.
“A sizable chunk of today’s procurement community is not ready, trained or capable of dealing with the implications of tomorrow’s technology on roles, meaning we’re looking at a potential talent shortage.
“To upskill, training is one option, although this isn’t expected to be the main path to addressing this shortage. But it matters as CPOs assess how many team members can be ‘upskilled’. The key here will be training programmes that emphasise problem solving, relationship management, business acumen, and more.”
Procurement’s future
Procurement is at a sliding doors moment. With transformation rife and more opportunities than ever in 2024, the function has a chance to reinvent itself and become an attractive proposition to tomorrow’s talent. For too long, procurement has been a place where practitioners stumble upon it and end up staying. The objective now is to find a way to establish itself and become a destination of choice rather than an accident or circumstance. Over to you, procurement.
