procurement 2030

level 1
game over for procurement?
 I T’S FA R F RO M G A M E OV E R F O R THE P R OFE S S ION
For professionals working in the fields of procurement THE PROFESSION MUST EVOLVE PRISONERS OF OUR OWN PERCEPTIONS
and supply chain management, a future brimming with • This research reveals that 92% of procurement • 55% of respondents claim their wider organisation
artificial intelligence, cognitive technology and robotic professionals believe the profession will look different only has a moderate level of understanding of the
process automation presents an incredible opportunity, by 2030, with 51% predicting the profession will value that procurement can bring.
but also a great deal of uncertainty. evolve into an agile group of strategic advisors to • Procurement’s own perception of its main
The profession must evolve, but which way will it go? the business. purpose remains firmly focused on the traditional
BUT HOW DO WE GET THERE? metric of cost – yet this core purpose is expected
Michael Page UK and Procurious surveyed 590
• Through the enabling power of automation. Currently, to shift significantly by 2030.
professionals around the globe to discover where they
believe procurement and supply management will be respondents spend up to 49% of their time on tactical In part one of this four-part series, we examine
by the year 2030, and what professionals need to do tasks, and estimate that up to 42% of the workload the outlook for procurement, the threats and
today to make themselves indispensable in an could be performed by AI. opportunities keeping professionals awake at
AI-enabled future. • Technological advances are seen as the number one night, and the perceptions of procurement that
opportunity for the profession, while failing to keep are holding the function back from achieving its
pace with technology is also the leading threat to transformational goals.
procurement and supply management.

FORECAST FOR T H R E AT S A N D PERCEPTIONS

THE PROFESSION OPPORTUNITIES OF PROCUREMENT
Far from worrying that the continued automation It isn’t a contradiction to reveal that the two greatest Successfully shifting perceptions of value and
of procurement will lead to the extinction of the threats facing the procurement profession are also purpose will enable procurement to launch the
profession, procurement professionals are optimistic regarded as its most significant opportunities. profession into the strategic stratosphere and thrive
that the function will be thriving by the year 2030. in the new world of Industry 4.0.

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 FORE C A S T F O R TH E PR O FE S S ION
By 2030, procurement and supply chain management:

50 60
40
70
30
76
72
20

80
:
17
20
10

90
100
0

0 Will have disappeared as a profession

50 Will be about the same
100 Will be an even more thriving profession

Procurement professionals are moderately optimistic that the profession will be

even more thriving by 2030.

BROADCASTING PROCUREMENT POSITIVITY Global thought-leaders in procurement predict how the profession will evolve
and transform by 2030. Featuring insights from:
Procurement professionals remain optimistic about the profession, despite the rapid
development of ever-smarter AI and media coverage of white-collar job losses to • IBM CPO, Bob Murphy
automation. In fact, optimism about the future has climbed by four points since this • McKinsey and Company Partner, Tarandeep Singh Ahuja
question was asked in 2017.
• The Hackett Group Principal, Chris Sawchuk
While the profession itself is confident about its future, the task at hand is to • CS Energy Head of Procurement, Rhonda McSweeney
broadcast this positivity to the wider organisation, other functions, and to suppliers.
• BP Asia-Pacific Head of Procurement, David Macdonald
Building upon the brand of procurement will enable us to:
• change the face of the profession from the inside out
• overcome outdated stereotypes, and
• educate others on the full value-offering of the profession.

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 FORECAST FOR THE PROFESSION

Percentage of tasks that can

Tactical versus strategic workload potentially be automated Job security*
Half of current procurement workload regarded Nearly half of current workload can potentially Only 9% of respondents lack confidence in job security.
as tactical. be automated.

Very
confident 54%

Strategic Tactical Cannot be Can be Moderately

51% 49% automated automated confident 37%
58% 42%
Not very
confident 9%

* Confidence that respondents will be able to keep their role for

next 24 months.

GAME OVER... FOR TACTICAL PROCUREMENT “Our clients still require candidates with tactical
With 49% of procurement’s workload regarded as “tactical”, there is a great deal of potential for automation in purchasing experience, but fewer than 20% of the
the profession. Survey-takers believe as much as 42% of their current workload is ripe for automation, whether it’s roles advertised are for purely tactical purchasing
through the use of cognitive technology, chatbots or other aspects of Industry 4.0. skill sets. As the profession develops, basic
purchasing skills are a given, but candidates who
Yet, despite expectations that nearly half of the average workload will be automated, job security perception is wish to progress will also require strategic purchasing
high, with 54% of respondents “very confident” they will be able to keep their current role for the next 24 months, skills and the ability to deploy these in complex
37% moderately confident, and only 9% not confident. global business environments. Demand continues to
This may be due to the fact that today, purely tactical roles in procurement and supply management are relatively outstrip supply for technology-savvy, adaptable, fast-
rare. Even survey-takers who identified their role level as “junior” identified only 59% of their roles as tactical in learning candidates.“
nature. Filtering roles by speciality reveals that analytics professionals have the most tactical tasks (57%), followed Nicholas Lawrence
by supply chain (56%), while the tactical workload of category managers sits at 46%. Regional Director at
Concerningly, 57 respondents who identified as Chief Procurement Officers indicated that 40% of their workload is Michael Page
tactical on average, despite having what is regarded as a highly strategic role.

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 LEVEL UP

PROCUREMENT POSITIVITY EMBRACE TECHNOLOGY

The profession has to optimise the picture that is being painted about Digital transformation has already started to affect a multitude of industries
procurement. The more positive words and imagery that are put out there, the and in order to not be left behind, procurement and supply chain needs to
more we will be discovered and our value understood. Click icon to read more. universally embrace it. Click icon to read more.

MAKE YOUR DATA AN ENABLER HONE YOUR SKILLS

At present, valuable time is wasted on disputing the data in supplier and Expectations of procurement and supply chain management are constantly
stakeholder meetings. Improved AI will lead to trusted data, which in turn will changing, which is why your skill set needs to keep pace. Discover the five
create opportunities to reinvent and add value to relationships. Click icon to technical skills that are shaping the industry. Click icon to read more.
access webinar.

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 T H R E AT S A N D O PPO R T UN ITIE S
Greatest threat to procurement Biggest opportunity for procurement TRANSFORMING THREATS
and supply chain management and supply chain management INTO OPPORTUNITIES
Technology and talent are simultaneously the greatest threats and the biggest opportunities for the profession. It’s no surprise that the two greatest perceived threats to
Scores out of 10. the profession are also its biggest sources of competitive
advantage. Technology and talent require an equal
5.40 Not keeping pace with 6.04 Technological advances amount of focus and investment to enable procurement
technological advances to unlock its value potential.
• CPOs and IT category managers are faced with a
4.53 Being unable to recruit 4.71 Recruiting and dizzying array of potentially game-changing new
and retain top talent retaining top talent technology to invest in, but must balance the risk of
falling behind with the pressure to make the right
4.08 Reputation and brand 4.20 Reputation and brand strategic decision for their organisation.
damage • Similarly, falling behind in the much-discussed
“war for talent” risks putting your organisation at a
3.98 Geopolitical shocks disadvantage and negating any potential benefits of
3.96 Cybersecurity
technological investment.
3.64 Industry being disrupted KEEPING UP WITH THE PROCUREMENT JONESES
3.88 Geopolitical shocks
Another factor to keep in mind is the idea that even
3.43 Cybersecurity the best people manager will struggle to attract and
3.79 Industry being disrupted retain top talent if their function has not kept up with a
competitive level of technological investment. Top talent
2.37 Natural disasters
2.61 Natural disasters will inevitably be drawn towards procurement functions
with leading-edge technology – meaning that your best
talent may become disenchanted with having to spend
“Whilst leading organisations continue to invest heavily in the latest enabling technology, it’s important to significant time on tactical tasks that are fully automated
remember that a major source of competitive advantage comes from recruiting – and retaining – top talent. in other organisations.
Our clients are increasingly looking for candidates with the skills and ability to leverage their organisations’
technology to create real value. CAPITALISE ON BURNING PLATFORMS
How can a natural disaster or reputational damage be a
As such, job specifications for procurement and supply management roles are increasingly technology-led source of opportunity? Disruptive events such as these
and candidates must position themselves as technologically relevant.” can provide the burning platform needed to give focus
Nicholas Lawrence and credence to procurement initiatives, offering the
Regional Director at Michael Page function an opportunity to prove its value while the issue
is a high priority for the wider organisation.
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 LEVEL UP

BECOME THE CPO OF THE FUTURE WIN THE WAR FOR TALENT
The CPO of the Future will seize every opportunity that Industry 4.0 presents. As employers and providers in the world of procurement, it’s up to us to make
Find out why the profession is looking to IT procurement experts for leadership. procurement a strategic and desirable field to enter. Step one? Motivate your
Click icon to read more. team. Click icon to read more.

MAKE THE MOST OF A BURNING PLATFORM THINK THE UNTHINKABLE

Economic woes, political uncertainty and digital disruption might trouble your How can you prepare when you know the worst is coming, but you can’t be sure
CEO, but it should delight the procurement function. After all, procurement when, where or how it will come? Are you equipped to manage the impacts of a
shines brightest on a burning platform. Click icon to read more. major disruption hitting your supply chain? Click icon to watch the video.

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 P ERC E PTI O N S O F PR O C UR E M E N T
Wider organisation’s level of WHAT’S HOLDING BACK THE
Procurement in 2030 will resemble… understanding of procurement value TRANSFORMATION?
92% of respondents believe the profession will Less than a quarter of organisations have a Overwhelmingly, respondents believe
look different by 2030. strong understanding of procurement value. procurement in 2030 will look different to the
profession today, a result most likely informed
51% 55%
by the changes procurement and supply
management have undergone over the past 10
to 15 years. The two stand-out expectations of
procurement are that the function will become:
24%
• an agile group of strategic advisors, and
21% 22%
• an influential group of commercial leaders.

8% 9% While the majority of respondents rejected the

5% idea that the profession would look the same in
3% 2%
2030, they also do not believe the profession will
Little Moderate Strong Other be fully automated (9%) or completely outsourced
Similar An An Completely Completely Other
under- under- under-
to today influential agile outsourced automated standing standing standing (3%), again reflecting a high level of positivity
group of group of around the outlook for the profession.
commercial strategic
leaders advisors
THE STICKING-POINT
Comments about the organisation’s However, before launching a transformation of
“According to the CPOs we work with, the number one way to understanding of procurement value the profession, procurement must address a
maximise procurement’s impact is to align the function with the
persistent sticking-point – a lack of understanding
corporate strategy. Once this is done, it comes down to the ability
of procurement’s full value-offering from the wider
to effectively influence. This is not about the ability to negotiate a “None, absolutely none.” organisation. 21% report their organisation has
cost saving with a supplier (that is a given!) but the ability to listen
“little understanding” of the value procurement
to, coach, educate and influence stakeholders to make a positive
“We’re often seen as a blocker” can bring, while 55% only have a moderate level
impact on the corporate strategy. Elite procurement professionals
of understanding. There is work to be done in
actively seek to better understand the challenges their stakeholders
“They loathe dealing with us”’ broadcasting, amplifying and celebrating the
face, avoid using procurement jargon, and always deliver on their
value that procurement can potentially bring,
commitments.“
“They often think we’re just above and beyond cost reduction.
Nicholas Lawrence
Regional Director at being difficult”
Michael Page

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 PERCEPTIONS OF PROCUREMENT

Main purpose of procurement today Main purpose of procurement by 2030 Other purposes of procurement in 2030
Cost reduction and risk management are currently Supplier innovation and sustainability expected to become
regarded as the main purposes of procurement. core purposes of procurement by 2030.

Cost Cost “Driving value”

reduction 38% reduction 15%

Risk Risk “Driving strategy”

management 22% management 18%
“Relationship builder”
Driving supplier Driving supplier
innovation 12% innovation 29%
“Growing the profit”
Driving
sustainability
15% Driving
sustainability
25% “Stellar supply chain management”

Other 13% Other 13%

COST IS STILL KING...FOR NOW

When asked to nominate a single, main purpose of procurement, cost reduction unsurprisingly came out as the number one result, followed by risk management. While this is a
result of organisational expectations of the procurement function to drive down costs and manage risk, it demonstrates that procurement’s own perception of its purpose needs
to change if it is to expand its value offering and transform into strategic advisors and/or commercial leaders.
With 42% of procurement tasks expected to be automated (see page 4), procurement functions must work towards automating the tactical elements of cost reduction and risk
management.
Encouragingly, survey-takers believe the main purpose of procurement will shift away from cost reduction to two high-value tasks: driving supplier innovation and sustainability.
The unique position as supplier “innovation scouts” will give procurement professionals a valuable opportunity to make a positive and substantial impact on organisational
sustainability targets. An increased focus on supplier innovation will also support procurement’s core capability of cost reduction.

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 LEVEL UP

BE COMMERCIAL PROCURE WITH PURPOSE

What does it mean to “be commercial”? Discover why it is important to be With driving sustainability expected to be a key purpose of procurement by
commercially aware in procurement and supply management. Click icon to the year 2030, it’s important to understand how we can procure with purpose,
read more. whether it’s through employing social enterprises, making better environmental
choices, or combating modern slavery. Click icon to learn more.

BECOME AN INNOVATION SCOUT UPGRADE YOUR PROCUREMENT MINDSET

Procurement has a unique and important position as the organisation’s gateway Cost is still king for now, but this will change as procurement increasingly
to supplier innovation, but how can you best harness new ideas from your most demonstrates its value to the business. But is a change in mindset best driven
innovative suppliers? Click icon to join the discussion. from the top-down, or bottom-up? Click icon to read more.

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 < S TAY T U N ED >
I N T ER ES T ED I N L EA R N I N G MORE?

Don’t miss parts 2 to 4 of this report, which will explore:

Preparing for the revolution: Ways in which organisations are preparing today to meet the challenges of Industry 4.0
Human vs AI Skill sets: The decision to automate versus humanise
Procurement Makeover: Expectations of procurement towards 2030

LEVEL 1 LEVEL 2 LEVEL 3 LEVEL 4

GAME OVER PREPARING HUMAN PROCUREMENT
FOR FOR THE VS. MAKEOVER
PROCUREMENT? REVOLUTION AI SKILL SETS

SEPTEMBER 2018 OCTOBER 2018 NOVEMBER 2018

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