In a recent white paper, Accenture cites a survey of the world’s CPOs noting that 75 percent of those surveyed reported that the downturn has “significantly affected” their purchasing operations. More that 50 percent claim their procurement budgets had been cut, many reported that they were experiencing cut of more than 15 percent. At the same time, savings targets have increased, and nearly 20 percent report that they now need to deliver savings of 15 percent or more.
This is very much in-line with our experiences. Purchasing functions are under pressure to do more with less.
A few days ago, I touched upon this subject in a post called “Talent and competence retainment in a downsizing economy” and I’d like to expand a bit on this subject.
In times of turmoil and significant downsizing, CPOs and purchasing directors need to be very clear in they ways they lead the changes whilst manage expectations and motivation. Successful leadership can be attributed to the following three areas:
- Visibility – Lacking information, rumours will flourish like air filling vacuum. CPOs need to keep staff informed of changes (internally and externally).
- Engagement – Involvement in the change process is two fold. Not only does the staff see the engagement of the management first hand, they also partake in the decisions and are able to vent concerns, offer improvements and channel their energies away from distractions.
- Value-driven – True understanding of what the real value for the company is, is vital for keeping motivation. Unfortunately, in bad times, long term goals are often obscured by the panic to save the moment, yet much research suggests that staff with an inner drive and a deeper understanding of the business model often outperforms staff whom focus on delivering the set targets.
Successful leadership is often attributed to being able to see and channel the talent of each and every individual. Everyone has the power to excel if their talent and potential can be brought into the lime light in a given situation. Being visible and transparent with relevant information, engaging staff in the process and projecting the long term goals and strategy of the business provides a foundation for bringing out this potential. Something that is vital to tap into in order to succeed with doing more with less.
