Top Ten CPO Priorities for 2022Procurement
TOP TEN CPO PRIORITIES for 2022: Webinar Recap
In late 2021, The Hackett Group asked Procurement Leaders about their strategic priorities and initiatives for the coming year. After a rollercoaster 2021, how do we pivot and plan for a successful Procurement strategy in 2022?
Vishal Patel, VP of Product Marketing, Ivalua and Chris Sawchuk, Principal and Global Procurement Advisory Practice Leader, The Hackett Group discussed disruptive trends and growth projections across a variety of Procurement Technologies.
Below, a summary of the TOP TEN CPO Priorities discussion and why some of these have shifted in the post-pandemic world.
1. REDUCE SUPPLY RISK TO ENSURE SUPPLY CONTINUITY
Improving business resilience and reducing supply disruption to protect revenue and profitability has become a top priority in 2022. We expect procurement organizations will continue to enhance visibility, agility, and capability.
2. REDUCE SPEND COST
Supplier spend is changing rapidly and organizations must manage supplier spend by identifying the shift in the current inflation (adjusted price of the supplier’s goods). While supplier relationships are priority, external factors such as currency, demand, and cost of energy are affecting pricing and supply. Preparing for these future inflationary changes requires strong negotiation capabilities and long-term resilience.
3. ACT AS A STRATEGIC ADVISOR TO THE BUSINESS
Procurement teams will be empowering a strategy advisor to provide a framework for how to leverage technology, retain talent, and drive sustainable value. We know that businesses thrive when they focus on their primary mission and align the value they provide their customers with the value their customers are willing to pay for. Ultimately, it is the combination of these two that drives sustained success. It’s not only about relationship skills, it’s about sharing competitively differentiating intelligence.
4. ENABLE CORPORATE SUSTAINABILITY
Today, consumers expect organizations to act in good faith to support a sustainable economy that protects the well-being of our families and communities. Digitizing spend management will transform the way we anticipate change, maintain the integrity of our resources and partners, and advocate for the people who work in our communities.
5. IMPROVE ANALYTICAL, MODELING AND REPORTING CAPABILITIES
Procurement is a complex process that is often described as an art and a science, with quite a few disciplines involved. As inflation rises, procurement departments will need to improve their analytical, modeling, and reporting capabilities. 2022 will require a significant focus on modeling and projecting to maximize procurement and supply chain efforts.
6. ALIGN SKILLS AND TALENT WITH CHANGING BUSINESS NEEDS
Procurement is requiring a broad range of exemplary skills and competencies that often need an entirely new ecosystem of experts. Leveraging the power of a contingent workforce is key to staying flexible and profitable, as organizations adapt to the changing needs and tech innovation.
7. ACCELERATE PROCUREMENT’S DIGITAL TRANSFORMATION
Since its onset, digital transformation is a journey of change for any organization. Today’s leaders must look to technology to empower their teams, freeing capacity, delivering actionable insights, facilitating broad and deep collaboration, and providing the flexibility to easily adapt and evolve with market shifts. If not now, when?
8. MODERNIZE PROCUREMENT APPLICATION PLATFORMS
The role of technology in today’s world is critical, but being able to deliver the right information at the right time to the right person can be a daunting task. Organizations are leveraging technology and modernizing legacy procurement application platforms with cloud-based procurement software suites to fill gaps in functionality and security.
9. IMPROVE PROCUREMENT AGILITY
Procurement leaders understand the power of an advanced procurement platform that can deliver more value to improve responsiveness, speed, and agility.
10. IMPROVE STAKEHOLDER-CENTRICITY
Stakeholder-centric business models must begin to empower procurement teams to innovate while improving organizational performance. In 2022, teams will begin to maximize their people, equipment and technology to meet internal changes and demands.
2022 Outlook: Talent, Technology, Corporate Responsibility
Onboarding talent and leveraging a contingent workforce will become the norm as businesses adopt a hybrid model and talent acquisition remains highly competitive. Corporate social responsibility will continue to become one of the central and directly impactful priorities for organizations . Procurement teams are modernizing their operating model as they mitigate supply chain risk and reduce supplier spend. There is no doubt that the future of procurement is becoming increasingly digital. To thrive in this new world, companies must develop a strong vision and strategy that enables them to best leverage digital technologies. With an incredible amount of new and exciting changes, we’re looking forward to a successful year of growth!