To cut through the often-overwhelming noise in the procurement landscape – from geopolitics to supply disruption, digital to sustainability, and beyond – we consult leading CPOs to get their take on where we should be focussing efforts in the coming year.
Reflecting on what we have learned from the past 12 months, it’s likely 2024 will also be rich with opportunities and challenges to embrace and navigate. And so, decision-making persists for CPOs and business leaders.
As the year gets underway, we see a certain degree of ease and relief across rates of inflation and supply chain capacity. Yet simultaneously, we are approaching a boiling point in global politics, where tension between key markets continues with the backdrop of the biggest election year in history, fuelling the situation further.
Daily escalations in the Middle East, ongoing war in Ukraine, and increasing frostiness between China and Taiwan – are just examples of the threat facing global supply disruption and reshaping trends.
Many of the themes covered by this year’s CPOs are set to stay for years to come; think risk, cost, and sustainability. At the same time, they focus on the here and now; how do you navigate these topics in the short term to ensure you are set up for future success.
Of course, a key addition to this year’s outlook is the transformative potential of AI. We consider this to be an essential part of the “how” rather than the “what”; getting up to speed with the rapidly evolving Industry 4.0 will be key for CPOs to translate innovation into action.
Key themes set to shape 2024
In between the insights from our CPO cohort, Proxima’s own CPO, Simon Geale, provides his reflections on the key themes that emanate; simplicity, pragmatism, and community.
Simplicity will play a big role in how organizations transform throughout 2024. “While aiming for efficiency, we’ve created rules and processes that have slow lead times and do not add significant value” highlighted Thomas Udesen, CPO at Bayer.
Focus on removing barriers that were initially put in place to encourage and corral the business into working with procurement. Something that now, given procurement’s increasingly strategic position in the business, is not as needed. It’s time to get back to basics and determine what it is that really matters, and what are the true markers of success.
Many mentioned pragmatism, whether in the context of digital, sustainability, or other. The point is that vision and action must work in harmony. Taking inspiration from what’s possible is all well and good, but actually doing what is practical is what will move you forward. We need both dreamers and landers.
The final theme, community, isn’t new. In fact, partnerships and collaboration has been cited as a strategic procurement necessity for years. But perhaps the new spin on it, is recognizing the value in how wide-ranging and interconnected these communities can become. The challenge is in being open to innovation and change, whilst maintaining procurement’s commercial edge.
Other themes posed by our contributors offer further practical insight. Cost versus true value – an ongoing discovery of what you’re really trying to achieve. Technology won’t deliver excellence on its own – it needs talented people to design, implement, and manage the right solutions for the organization. Antiquated ways of working are out – procurement in 2024 is modern, learning from years gone by but leaving what no longer serves where it is. And resilience. As Sandra Brummitt offers in our report: “…achieving resilience is really about what you do with what you see”, highlighting the need to be action-orientated when it comes to procurement and supply chain resilience this year.
To find out more…
What remains is to thank our 2024 CPOs for giving up their time to share their insights. We will also be sharing their top tips for you on becoming a CPO in our Tomorrow’s CPO Report, out next month. What’s clear is that there are some real, challenging business issues to solve in 2024, many of which are competing directly with the clear need to be laser-focused on cost and cash this year. It’s often been said that procurement are value architects. 2024 is the year to prove it.
Each year, we consult leading Chief Procurement Officers to get their take on the opportunities and challenges in the year ahead for our Proxima CPO Report. We hope you will find the reflections of this year’s CPOs – Thomas Udesen – CPO at Bayer, Sandra Brummit – CPO at NiSource, Laura Cook – Director of Procurement at Primark, Tim Herrod – VP, Global Procurement at Albermarle, Gareth Rhys-Williams – UK Government Chief Commercial Officer, and Simon Geale – EVP at Proxima thought-provoking and helpful as you set you and your teams’ agendas for 2024 and beyond.