PROFILE
SIXTY PERCENT OF Chief Procurement Officers ( CPOs ) believe that their teams lack the skills needed to run a satisfactory procurement effort . Almost six in 10 see managing risks as a priority . These statistics , and more , have been produced by Deloitte for its 2017 CPO study . Conducted in association with Odgers Berndtson , the global CPO survey is an annual survey of CPOS across the world . 480 procurement leaders from 36 countries around the world took part in this year ’ s survey .
“ We ’ ve got South America , we ’ ve got China , we ’ ve got a quite a big presence in Asia pacific and Australia in particular , so there ’ s thirty-six different countries this year ,” Lance Younger , UK Head of Sourcing & Procurement explains .
The study represents organisations with a combined annual turnover of $ 4.9 trillion . “ By nature , [ the study ] does tend to appeal to bigger organisations ,” Younger tells us . “ But we mostly get a good cross section , we get government and public sector too .”
I think it ’ s always important to take a poll , understand what the market priorities are and what organisations are doing about that ,” Younger continues . With his help , we take a deeper look at the results of the study , and what they mean for the market .
A notable finding is that the number one priority for 79 percent of CPOs is reducing costs . This is closely linked to 48 percent wanting to increase cash flow to help fund growth . Younger describes how from a purchasing perspective , there ’ s been an increased level of engagement with helping new products enter new markets and creating services . “ Another fact is that while purchasing is doing a lot of short term actions to help reduce cost ( price bench marking , negotiations and spend consolidation ) they ’ re not doing some of the medium to long term actions which relate to supplier relations management which we would expect ,” Younger explains . Deloitte recommends that purchasing continue current cost reduction actions , but examine how they affect medium to long term performance .
Risk is another priority for purchasing teams . Younger comments : “ From a purchasing perspective there is undoubtedly a focus on cost and risk .” 57 percent of CPOs said that managing risk is top of their list for this year . Key global risks cited include weakness and
12 May 2017