We did some research as part of the Mastermind LIVE event we held back in October. We asked all of the registrants to answer a few questions related to their objectives, priorities, and challenges heading into 2021. Almost 600 respondents shared their number one objective with us, and now that we are actually in 2021, we thought it would be a good idea to share it with you.
BUT, before I share that information, I want to first sit on the fence a little bit. The priorities of a CPO should be directly tied to the key priorities of the business as a whole. Where we often get into trouble as the procurement organization is where our priorities aren’t aligned with the business’ priorities.
Now, we can, of course, attempt to influence business needs if we see that there are different things that the business could be doing. That is included in our role as a catalyst, so I don’t want to suggest that we always just have to do what the business asks of us. But we’ve got to be mindful not to push our objectives on the business if that’s not what the business needs.
Now that I’ve shared that, let me share with you the results from our Mastermind LIVE survey.
As you would expect, the first priority is cost savings. 35 percent of respondents said cost savings is their number one priority entering 2021.
Number two was growth enablement – 24 percent of respondents. I find it interesting that there is such a focus on growth, although cost savings can be used to fuel growth, when they are reinvested back in the business rather than dropping directly to the P&L.
The third priority – which was a real surprise – was sustainability and diversity with 14 percent of respondents.
Number four was risk and ensuring supply, with 13 percent of respondents. It is interesting that risk – at least in this survey – actually ranked below sustainability and diversity given the last year and the role that procurement has played in ensuring supply continuity in recent months.
And then, number five on the list was facilitating supplier-enabled innovation, at 8 percent.
So, what do we think about these 5 priorities? The reality is that there are three types of business right now. There are companies that are in hyper-growth mode, companies that are in “protect what we’ve got” mode, and companies that are adapting to completely new business conditions as a result of the pandemic.
For those in growth mode, growth enablement is everything. Anything procurement can do to enable growth is the top priority. For everybody else, the most common piece of feedback I get from the CPOs I work with right now is that they have to focus on savings because their company needs to ensure survival before they can focus too much on the future.
I encourage anyone within procurement, at any level, who’s working from a category perspective to stop and truly understand the needs of the business and build priorities around that.