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How CPOs Around the World Think – and Worry – Like You Do


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From bright-eyed optimism and long sleepless nights, to analytics, mobility and procurement content, our 2013 Global Chief Procurement Officer (CPO) Survey dug deep to learn what’s top of mind with procurement executives the world over, and get their take on the ‘digital age of procurement’.

In this session, we’ll share their concerns and unpack their insights including the investments CPO’s are planning to make in this digital age. With broad-based supply chain collaboration and risk management across trading partners fast becoming the norm, we’ll demonstrate how Ariba’s enabling technologies and network can bring your procurement business to new, high-performing places.

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How CPOs Around the World Think – and Worry – Like You Do

  1. 1. How CPOs Around the World Think - and Worry -- Like You Do Procurement’s relevance as the economy returns to growth Ariba LIVE – Las Vegas March 2014 #AribaLIVE © 2014 Ariba – an SAP company. All rights reserved.
  2. 2. The 3rd Annual Deloitte (Global) Focus: CPO Survey • • • CPOs and Senior Procurement Executives globally Annually repeated to provide a true finger on the pulse Focused on key business indicators such as: • AND...Understanding the alignment between the CPO and the business across key business performance themes Demographics: 180+ survey respondents 19 countries All major industry segments • • • • Deloitte / Odgers Berndtson CPO Survey 2013 2 © 2014 Ariba – an SAP company. All rights reserved. Supply market security and risk Financial prospects Plans and expectations Business partnering Talent Digital age
  3. 3. CPOs Are Facing an Inflection Point “…procurement’s influence within the business continues to rise while also delivering increasing amounts of value and hitting savings targets.” - Procurement Leaders, 24 May 2013 Source: Deloitte CPO Survey: 2013 3 © 2014 Ariba – an SAP company. All rights reserved.
  4. 4. Drivers of Change and CPO Sentiment Green shoots of recovery supporting growth again Risk growth is prevalent across the board Lack of influence over the business Broader skills are required Source: Deloitte CPO Survey: 2013 4 © 2014 Ariba – an SAP company. All rights reserved.
  5. 5. View from the Market 5 © 2014 Ariba – an SAP company. All rights reserved.
  6. 6. Key Takeaways… 3 4 6 Risk and Accountability Technology and Analytics Tomorrow’s Talent © 2014 Ariba – an SAP company. All rights reserved. Reviewing business partnering models to improve influence/engagement Leveraging network platforms to create many-to-many collaborations • • • CPOs believe procurement risk has increased • • Investing in new analytics solutions to drive insights • 2 Partnerships not Processes • • • 1 Facilitating self service and broad-based collaboration across entire lifecycle • • • Repositioning procurement as a “career destination” Improving margins for both parties; “two-way” margin management Engaging team in the risk management agenda Partnering more comprehensively with Finance and Legal Facilitating price and risk compliance with better integrated trading networks and technologies Outsourcing services that are not core competencies Developing centers of excellence with skills and tools to facilitate hand-offs and collaboration across multiple parties (internal / external)
  7. 7. Partnerships Not Process Effort Perception of Procurement’s focus… 45 40 Customer Need 35 30 25 20 15 10 Procurement Effort 5 0 Business alignmentCategory management & sourcingbuying, contracts & compliance planning and performance Supplier Operational & innovation Requisition to pay performance …can we close the expectation gaps What does this mean for the future role of Procurement? • • • 7 Insight not process will reduce cycle times and make procurement easier to work with Self-service tomorrow for aspects that are core Procurement delivery focus today Performance measured in terms of supplier delivery and customer satisfaction over savings © 2014 Ariba – an SAP company. All rights reserved.
  8. 8. Partnerships Not Process – Key Findings Themes • • Making measures relevant • 8 Creating the right agenda Making the time to partner © 2014 Ariba – an SAP company. All rights reserved.
  9. 9. Partnerships Not Process – Next Steps What can Procurement Leaders do to get closer to the strategic edge of their organization and become a more effective business partner? • • Tailored measures and accountability • Come prepared • 9 Why does the business need you? See partnering as a distinct skill © 2014 Ariba – an SAP company. All rights reserved.
  10. 10. Risk and Accountability – Key Findings Themes • • © 2014 Ariba – an SAP company. All rights reserved. So what is the role for Procurement? • 10 More often, more expensive Capability to deliver
  11. 11. Risk and Accountability – Next Steps An increased focus on the risk agenda from business leaders offers another excellent opportunity for CPOs to demonstrate their worth • • Flexibility • Collaboration • 11 Visibility Skills © 2014 Ariba – an SAP company. All rights reserved.
  12. 12. Technology and Analytics Themes • • Hindsight, insight, for esight • 12 Technology on the agenda Bringing B2B to B2C © 2014 Ariba – an SAP company. All rights reserved.
  13. 13. How Ariba Enables CPO’s Value Levers CPO Value Lever Ariba Value Proposition Consolidating Spend Ariba Spend Vis & Analysis Consolidates spend and across systems. Supports real-time visibility, analysis, and insight; potential for forecasting and predictive analytics Increasing competition Ariba Network Bolsters competition; access to new trading partners Specification improvement Ariba Sourcing and Contracts Supports tighter control of specs and ability to buy off contracts Increasing level of supplier collaboration Ariba Network Enables a flexible foundation for broad “many-to-many” collaboration Reducing total lifecycle / ownership costs Ariba Spend Mgmt. Reduces TCO from sourcing negotiation through realization Reducing consumption Ariba Buyer Supports control / transparency of consumption (electronic approvals) Restructuring existing relationships Ariba SIPM Provides objectivity and data (customer service); informs discussions Optimizing supply chain costs Ariba Spend Mgmt. Provides end-to-end flexible, collaborative platform to manage costs Restructuring the supply base Ariba Sourcing and Network Organizes planning and execution of strategic sourcing; discovery and evaluation of alternative supply sources Outsource non core Sourcing/Procurement activity Ariba services and platform Addresses skills / talent gaps in non core competency services Reducing transaction costs Ariba Spend Mgmt. Optimizes efficiencies across transactions; provides for self-service Managing commodity price volatility 13 Key Ariba Module Ariba Contracts (Compliance) Drives price compliance; integrated, off-contract purchasing © 2014 Ariba – an SAP company. All rights reserved.
  14. 14. Technology and Analytics How should CPOs be thinking about their investments in technology? • • • • 14 Time to look through the windscreen Face up to the true value of reporting Self-service Getting analytical Play with talent Look to the source Start the clock Manage expectations Good hygiene Stay on target © 2014 Ariba – an SAP company. All rights reserved.
  15. 15. Tomorrow’s Talent – Key Findings Themes • • Traditional skills delivered through non-traditional means • 15 Broader skills required Developing the next generation © 2014 Ariba – an SAP company. All rights reserved.
  16. 16. Tomorrow’s Talent – Next Steps The survey results confirm that the war on talent continues to intensify • CPOs believe it is becoming harder to attract talent, yet they want to grow their functions, leading to more focus on retention. • Skills do not align with the needs of the business so what can Procurement leaders do to enhance capability and attract the top talent? Themes • Recognize distinct skill sets • • Be targeted and creative in your recruitment • 16 Invest in your internal teams Leverage 3rd-party collaboration © 2014 Ariba – an SAP company. All rights reserved.
  17. 17. Regional Differences in Responses 17 © 2014 Ariba – an SAP company. All rights reserved.
  18. 18. Looking Forward 1 Partnerships not Processes 2 Risk and Accountability Building partnerships with the business is more important than ever CPOs must find a way to better engage in the risk conversation and strategy 3 4 18 Tomorrow’s Talent Focus on building teams with the right skills and leadership to drive the agenda Technology and Analytics Technology investments are required to enable the value levers most important to CPOs © 2014 Ariba – an SAP company. All rights reserved.
  19. 19. Visit us to learn more Jonathon Magick, Principal or +1 (602) 315-8387 Brian Lynch, Senior Manager or +1 (713) 305-2283 General enquiries: Follow us on Twitter: @DeloitteSAP 19 © 2014 Ariba – an SAP company. All rights reserved.