Milling & Baking News - December 4, 2018 - 36

Procurement Update

BY PATRICK MITCHELL

This is the final article in the series on
"what is important to procurement today." In this series, I have taken an approach to challenge the functional progress that procurement has made by considering a set of "myths" that I feel frame
procurement inappropriately. I've attempted to establish from the initial article forward that there isn't "one source of
truth" for charting the path for procurement, yet there are common "themes"
that are evidenced in the models implemented by those leaders that are managing procurement the best.
I've said that great leadership is what
really matters for procurement, far more
than where procurement may report in a

Patrick D. Mitchell is president
of P.D. Mitchell Inc. and a senior
adviser with McKinsey & Co. He
has 35 years of supply chain and
procurement experience.

company enterprise structure. I've said
that end-to-end category management is
the true procurement "North Star," and
that "strategic sourcing" is an important
yet dated and under-matured tool within
it. And I've said that procurement talent must be approached from a strategic
standpoint, one that recognizes capability
needs tomorrow as much as today. The final theme that I believe rightly frames the
procurement pathway forward involves
the level of connectivity with internal
stakeholders and external suppliers.
My perspective is that procurement
leaders need to build collaborative platforms that complement the end-to-end
category management approach to sourcing in order to provide the level of internal and external connectivity needed
for sourcing excellence. Too often connections with internal stakeholders and
external suppliers fall well short of the
"collaborative" need and the commitment that I believe is required for procurement's success today and its sustainability tomorrow. Too often do we hear

Premium Quality

F LO U R 1 8 9 0
since

SQF LEVEL 2 CERTIFIED
* Michigan White and Red
Wheat Pastry Flour
* Hard Wheat Flours
* Whole Wheat Specialists
* Super Kleaned WheatTM
* Food Grade Brans
* Heat Treated Flours
King Milling Co.
616-897-9264
Lowell, Michigan 49331
36 / December 4, 2018

Milling & Baking News

www.kingflour.com

... "we have aligned our strategies with
the business" and "we have implemented
SRM," both inadequate and not well defined for the collaborative effort needed.
To best understand category management, the importance of collaboration
and collaboration's place while approaching sourcing, I'd ask that you think about
category management as a linear model
©ADIRUCH NA CHIANGMAI - STOCK.ADOBE.COM

Procurement collaboration leads
to sourcing excellence

even though it is perpetual in operation.
On the "front end," or business collaboration end of category management, business objectives need to be translated into
strategic imperatives for procurement.
My experience for getting this right
suggests a thorough distillation of company vision and strategy into actionable
imperatives for procurement, imperatives that clearly provide a stream of value that the business can recognize. And
on the "back end," or the supplier collaboration end of category management,
segmentation of suppliers will yield a
clear path for the contributed-value relationships procurement needs to have
across its supplier landscape. When done
effectively, this segmentation of suppliers will establish a key, strategic set that
will be the focal point for the collaboration platform on the back end of category
management.
My experience suggests that neither of
these collaborative platforms set solely as
"bookends," rather end-to-end category
management done right will evidence invested time with internal stakeholders and
external suppliers throughout the complete
sourcing management perpetuum.
I tell audiences during talks that collaboration with the business isn't an easy
task, that it takes a mindset that procurement's sourcing strategies are developed
with their business stakeholders and for
their business stakeholders and not in
some "procurement vacuum." The sourcing decision outputs of category management will be grounded in insight-driven
strategies that have been created with
business stakeholders in a seamless collaborative experience that is part of the
normal operating model of the business.
Collaborating with internal stakeholders
bakingbusiness.com / world-grain.com
http://STOCK.ADOBE.COM http://www.bakingbusiness.com http://www.world-grain.com http://www.kingflour.com
Milling & Baking News - December 4, 2018

Table of Contents for the Digital Edition of Milling & Baking News - December 4, 2018
