Milling & Baking News - December 4, 2018 - 37

Procurement Update

is an important part of the "fabric" of procurement's operating model, and the collaboration must be borne from a mindset
of two-way integrated thinking.
I recently had a chief procurement officer deliver a guest lecture during one of
the supply chain graduate school classes
I'm currently teaching, and he provided
the class with a couple thoughts that
resonated with me relative to the topic of
external collaboration. He said that "now
more than ever, procurement is the face
of its company to the external world" and
that "globalization has reached a level of
criticality that every economy is now intrinsically connected with procurement at
the root of the trade flows that have been
created." Finally, he affirmed what I've
been saying about procurement's value
proposition, but with a twist - "procurement's remit is much different today than
what it was 20 years ago... no longer is
it about how much money you can save;
rather it's about how much societal impact you can pave for your company."
I'm in agreement with everything he
said, and the content he associated with
each of these three comments made me
think about the development and maturity of the procurement space today and
how many c.p.o.s have thought it through
this way. I said to myself, "Wow! How impactful and what a difference maker this
c.p.o. must be for his company; to recognize that procurement strategies executed
through external collaboration can drive
so much connectivity, so much value for
his company and so much value to the
world." This is the message that should
be coming through relative to supplier
collaboration - procurement delivering
a vision of the value that can be achieved
through external collaboration, procurement driving business strategy from that
vision foundation and the company realizing differentiated value for its brands
and its reputation as a result.
There isn't a finite model for end-toend category management. Similar to
my thoughts that there isn't "one source
of truth" for procurement's path forward, only some common themes, there
is only a set of key standards for those
who approach category management
with excellence. It has taken a while for
the "core" of category management to
mature, elements such as category and
supplier segmentation, total cost management, and strategic sourcing, and I'd
suggest that less than 50% of the procurement space is operating this well today.
The collaborative platforms that enable
the core are the horizon in front of us,
and the insights that drive the thinking
are already upon us. So, if you haven't
yet thought of collaboration in the
bakingbusiness.com / world-grain.com

framing I've suggested here, please consider these three take-aways:
1. Procurement must operate today and
tomorrow in a collaborative framework
that is intentional, structured and visible
to its internal stakeholders and its external suppliers;
2. Procurement's collaboration internal
with stakeholders requires cross-business
involvement to define procurements,

value proposition, support its operating model approach and enable decision
making so that business strategy is clearly
executed through procurement strategy;
3. Procurement collaboration with suppliers can happen at all levels of segmentation; however, there will be a core set of
suppliers that the company will need to
"bet on" for the future, and the management of this falls to procurement. MBN

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Milling & Baking News

December 4, 2018 / 37

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Milling & Baking News - December 4, 2018

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