Procurement refers to buying for a business on a larger scale. Although its definition seems simple, it is a complex and competitive procedure. Special attention must be paid to each step, especially while selecting the vendor, payment negotiation, strategic vetting, and contract negotiation.
Multiple reports from SpendEdge have suggested that the landscape of procurement is all set for exponential growth, especially as the pandemic spreads. Procurement as a service market is expected to reach USD 12 billion by 2028. Since there is a huge potential in the industry, several technical leaders like Chief Procurement Officers or CPOs aim to climb the ladder and become board members. In this article, we highlight everything you need to know about the evolution of CPO, how you can get a seat on the board, and the changing dynamics in the world of procurement.
How can a CPO increase their chances of getting on the board?
In general, the competition is fierce for board opportunities, and the number of seats remains limited in any corporate organization. With the changing landscape of procurement, the good news is that preference is being given to CPOs, CFOs and CTOs. If your future goals include getting on a board seat early in your career, it is essential to be prepared well in advance. Develop a key proposition, identify the gaps in your critical skills and understand what you’re excited about. These steps will help you offer something powerful when you apply to the board.
**Rise of the Chief Procurement Officer **
The world of procurement is changing drastically, and so is the role of the Chief Procurement Officer. The industry is shifting from a price-centric focus to a more comprehensive outlook towards value. Business leaders are now looking to procurement to drive an impact and bring solutions for stakeholders.
With the increasing demand for Chief Procurement Officers, there is huge potential in the field. You can build impressive strategies and analytical skills to demonstrate your talent to motivate employees. However, it is also true that this is not the last step of the ladder. You may think even higher by understanding how you can get a seat on the board.
An ideal CPO needs to demonstrate a broader range of skills and capabilities while ensuring consistent results. Moreover, they need to be sure of geographical uncertainties, changes in the organization, financial distortions, and internal challenges. These hurdles coupled with talent shortages and stakeholder concerns need to be accounted for, making the role all the more challenging.
Qualities of a CPO That Will Get Them a Seat on the Board
Here are some of the major attributes that will help you get selected as a board member early in your career.
The first important quality of a CPO that can earn them a seat on the board is a business-centric approach. An ideal board member needs to commit their time, energy, and creativity as per the organization’s demands. It demands adding value to the discussions/decisions of the board. If you have an opportunity to be elected to the board, you should be prepared to get involved as much as you can while ensuring to follow a business-centric approach.
- Leadership Skills and Commitment
Just the right thought is not enough to make enterprise-level transformations happen overnight. The right CPO (and subsequent board member) needs to have a high-functioning capability to transfer their skills to the employees by creating a greater impact on the organization. Moreover, as the industry evolves, there are multiple career progression programs for employees. This way, the organization can have high-potential employees with the most advanced skills.
- **International Experience and More **
By international exposure, we don’t mean foreign trips and staying abroad. We mean the skills that come with it, a keen eye for mitigating risk and being market savvy. The rise of a CPO to a board member is majorly dependent on how they understand the potential risks from third-party suppliers or risks related to supply chain management. The everyday work of a board member is to make decisions from their experience, and this is where the risk analysis and opportunity management skills come into the picture.
Having a broader perspective is a crucial aspect for the evolution of a CPO to a board member. An ideal CPO is expected to deliver value beyond just price reductions. For this, it is necessary to move beyond the conventional style of working. Since cost optimization is only done after the upward costs of 70% are decided by the product or service company, the work of the CPO becomes a little more challenging. They need to work actively with several teams to make better decisions in real-time.
- **Interpersonal Skills **
The primary aim of any CPO is to establish strong relationships with stakeholders and blend them with the organization’s best interests. To be successful as a board member, you need to develop a make-or-break plan through your engagement models. One of the famous approaches is the ‘pull’ approach, wherein a CPO needs to let procurement influence the front end of the sourcing process.
On a different note, another tip that we can give you is to develop a natural affinity with other board members but don’t feed into political alliances.
In all, becoming a board member is truly a gratifying experience, and you can have it by contributing to the organization’s overall success. Focus on each level of the strategy, and you’ll be able to make a true difference!