Simon Geale recently sat down with Kodiak Hub to record Feature Frontier, a 20-minute dive into a few things procurement but in particular the importance of supplier collaboration.
Collaboration is not a new concept, I have been asked to speak about it a number of times over the past five or six years, and in doing so have drawn inspiration, at times, from historical examples, such as those outlined in Jeffrey H. Dyers book Collaborative Advantage, first published in 2000.
So, it is not a new idea, but it is a popular concept, perhaps verging on buzzword? I’d wager that it gets used as much for effect today as it does to describe activities and situations that are truly collaborative. Collaboration must be up there as one of the most frequently used words in event agendas or strategy presentations in procurement circles. So, why so popular now?
Unsurprisingly, the answer may lie partially digital; we can collaborate so much easier and better now, which means there are whispers all around us from solution providers. But collaboration is not just something that we can do, it is something that we must do, an imperative as we face into the “great procurement to-do list”. It is also a logical next step for procurement en-masse; as a capability that continues to mature over time.
Taking those in reverse order, procurements evolution has seen us evolve from our birth as generalist buyers and seen us evolve through phases focussed on specialization, partnering and insight, and now collaboration, or ‘Network Partners’ as we coined it in Proxima (see the image in the presentation).
Network Partners focus on value orchestration, i.e. bringing together multiple internal and external parties to ‘collaborate’ to achieve more than possible through more traditional, 121, more transactional relationships. Often aligned to products or programs, collaboration brings the best ingredients of all parties.
However, not all procurement can or should be collaboration-led. Procurement functions need a blend of capabilities, skills, knowledge, and tools to allow them to focus in different directions and on different value definitions at the same time. This drives specialization within the function, taking it in different directions that make some very different procurement sub-functions within a function. Some of that specialization is achieved through working with partners to evolve and optimize.
This is important because procurement’s “to-do” list is long and varied. There are big challenges facing into business, both short and long-term, and a rapidly evolving business landscape shapes both how we work, and what we are working on. Global, business and consumer trends are all prompting changes in how B2B and B2C work, some subtle, some not so, but the big issues like climate, transparency, risk, social inequity and supply chain recalibration will be dominated by collaborative efforts between peers and partners.
And these efforts will be underpinned by tech, as an enabler for some but increasingly as a co-pilot for many. Yes, we know that collaboration is essentially a human behavior, but digital gives us the opportunity to do more, more deliberately, more hands-free, and have central visibility thereof. That’s why businesses like Kodiaq, Vizibl, and others have become so hot in their messaging around collaboration. Because it’s real, and now.
Procurement is in the spotlight, and collaboration is one tool in the armory to address some of the biggest challenges that we face. We know that there are important eyes watching down on us; Proxima’s 2023 Supply Chain Barometer revealed that CEOs anticipate spending more time on supply chain-related issues this year compared to last year. Where CEOs have concerns, we must offer solutions and strategies that address them.
These new business challenges, the specialist evolution of procurement capability, and the emergence of tools that enable greater levels of collaboration and transparency come to us in unison. Now it’s up to us to be bold and challenge ourselves and our teams to get stuck in, disrupt industry norms, and deliver big outcomes. The future can be bright.
Building that initial plan and roadmap and taking those first few actions can be daunting when the overall scale of change is so great. For support in creating yours and setting some achievable and measurable targets, get in touch.