United Kingdom

Details

  • Service: Advisory, Management Consulting
  • Type: Business and industry issue, Survey report
  • Date: 22/02/2012

The Power of Procurement 

The Power of Procurement

KPMG, in association with CPO Agenda, has conducted an in-depth survey of 585 procurement functions across the globe. The findings are presented in our report, The Power of Procurement, and demonstrate that although most procurement functions have made significant progress in terms of creating value for their organisations, this momentum has stagnated in recent years. Much of the ‘low hanging fruit’ in terms of cost savings, leverage and price has now been harvested and procurement functions will need to take on a more strategic role and stretch themselves to identify new opportunities.

 

Please follow the link below to read the full report:

 

Key Findings

 

The following are the key areas where procurement is able to take on a more strategic role and enhance the value it delivers: 

 

  • Partnering with the organisation: To achieve a place at the boardroom table and become a true strategic partner, procurement must do more work to align to key stakeholders and understand the business operations.
  • Moving beyond cost savings: Squeezing costs from supply contracts will always be a central part of procurement. However, many organisations are struggling to extend their activities into core capabilities such as category management, and beyond into demand management, supplier relationship management (SRM), and risk management.
  • Achieving the optimal operating model: While most procurement organisations have already adopted a more centralised operating model, many still face challenges in translating this into strategic value for their businesses.
  • Prioritising supply chain risk: The research shows worrying lack of leadership in the area of supplier risk. Procurement will need to aggressively push the inclusion of supply chain risk on the broader business agenda, in order to protect the business from the uncertain and turbulent economic environment.
  • Leveraging systems and technology: While supply chain technology and business systems have evolved rapidly, many procurement functions seem unable - possibly unwilling - to leverage these new capabilities in order to bring greater automation to their business.

 

Procurement professionals have a significant opportunity to enhance the value they deliver, and consequently the competitive advantage of their organisations. However, it is up to CPOs and Supply Chain Directors to make the most of this opportunity.

More about the survey

The survey is a leading-edge global benchmarking project, likely to be the most comprehensive of its kind. The structured framework uses objective comparison using ratios and measures. It has been developed with and agreed by a panel of senior Chief Procurement Officers who believe it will address the issues that really affect organisations today, and covers both direct and indirect areas of spend.

Ongoing participation

The results of the survey allow participating organisations the opportunity to compare the performance of their procurement operations with their sector peer group. The survey is running on an ongoing basis and each participant will receive an individual, tailored report. The data gathered in this study, along with our extensive procurement experience, allows KPMG to provide genuine insights to our clients on functional excellence in procurement.

 

If you are interested in participating in the survey, please contact us at procurementbenchmarking@kpmg.co.uk.

 

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To contact one of our Procurement professionals, please email us:
procurementbenchmarking
@kpmg.co.uk