Risk and uncertainty seem to be the buzzwords for business right now, more so than ever. The latest Chartered Institute of Procurement & Supply CIPS Risk Index for the first quarter of 2017 reports that a lack of trust and transparency, as a result of ideological and military conflicts, are undermining the international supply chains linking the world. Prolonged conflict is creating a “supply chain no go area”, cutting off local businesses and consumers from global markets while facing a potential scarcity of goods.
And here is the challenge for all of us; it is very real and although the world has faced conflict and uncertainty before, this time it feels like we are operating in extraordinary times.
As a profession, procurement and supply management is on the precipice of dynamic and disruptive change resulting from volatile trading environments, increasing complexity and the influence of information technology.
From a professional perspective, technology is completely reshaping the workforce. Automation is eliminating jobs at lower levels and causing career disruption for many. For any professional today, the need for technical skills is common, but it can be a severe test of capability and leaves people feeling vulnerable.
It is therefore no surprise that CIPS considers the impact of technological change one of the most dramatic to affect our professions future, hence why it is a reoccurring theme when examining the future of the profession.
According to research CIPS released last year – CIPS Supply Century – our predictions for the future of the profession have made some difficult reading. We are in no doubt there are fundamental changes ahead. Procurement is changing and as a profession will have to continue to evolve if it is to maintain its critical standing in driving organisational success.
The more transactional activities will simply disappear and will become automated. The roles that remain will require new skillsets and we must adapt. Put simply what we have now will not be fit for purpose. Technology and management of data at speed will lead the way and will be a crucial differentiator for us and our organisations.
These changes present an opportunity as the procurement profession has never been so relevant. Technology can help us develop sourcing plans, identify suppliers, derive category plans and, for volatile commodities, sophisticated automated processes.
Of course there has to be a balance and where artificial intelligence meets emotional intelligence is where procurement professionals can maximise value. You can’t replace a procurement professional’s instinct and gut feel for when something doesn’t feel quite right. You can only do this by building relationships, having more face-to-face contact with suppliers, putting relationship building centre stage.
So as this ecosystem of supply chains and organisations becomes more complex and more diverse, and issues such as scarcity of supply increase, the procurement profession can expect to play the expert role in driving resilient supply chains and therefore resilient business.
Threats such as cyber attacks and modern-day slavery appearing in supply chains are just a few examples, but they mean we must be on the front foot; we have to tackle risk. We have to not just manage our marketplaces, but go out and create them, driving stakeholder and reputational value upwards.
Procurement professionals are well placed to take the leading role in shaping an enacting policy designed to alter behaviours to eradicate high-profile business risks. The modern slavery in the supply chains agenda, mostly led by the UK’s Modern Slavery Act, has pushed supply chain risk and compliance to the C-suite debate.
The future role for procurement as agents for change, acting as interpreters of the supply markets and creators of the solutions will ensure that businesses can rely on innovative, robust and sustainable supply chains for future success.