Getting Back on the CEO’s Agenda

June 14th, 2007 at 06:57am David Bush - Iasta

Recently, the CSCMP ran a great article on Getting Back on the CEO’s Agenda that contained some great advice for those procurement organizations that want to get front and center on the CEO’s agenda and not be viewed simply as a function (that should be) strictly
focused on cost reduction.

According to the article, the key is to shift focus to what drives customer value and growth. The organization should develop a framework for a rigorous and repeatable approach to profitable growth, set the proper context by using an outside-in customer perspective, quantify value, and demonstrate superb leadership behavior.

For the most part, I have to agree. If you don’t understand what the end customer wants, you don’t understand what you should be sourcing and whether engineering really needs the part that costs twice as much or whether marketing is right when they say it should be blue. It’s as important to understand the finished product as it is to understand the design so that you know where compromises can be made during the entire product life cycle and where opportunities may lie in the value chain.

The article also promotes leveraging your strengths to improve the procurement discipline wherever you can, helping to articulate the value of the product as perceived by the end customer, and improving their leadership skills to insure that procurement is looked upon as a leader. All sound advice.

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Entry Filed under: General, Supply Management Best Practices