Heads of procurement and their senior teams will frequently say that they want their function and their employees to become more “strategic.” Although this can be one of business’s worst buzzwords, in the world of procurement it can denote very real differences.
For example, those teams that are strategic will generate nearly six times as many savings for their company as those who are not.
To work on more strategic activities, procurement functions need teams whose skills complement one another, and then for managers to put employees in roles that make the most of their strengths (providing they’re roles that will help the function achieve the objectives in its strategic plan).
Unfortunately, just 30% of chief procurement officers agree or strongly agree that their staff are currently in roles that best use their strengths, according to CEB data.
This is because procurement managers rarely get a rounded view of employees’ activities, and what they’re good and bad at. Some of their activities (such as implementing projects or working with teammates) are visible to their managers, but others (such as selling the idea of a new project to business partners or interacting with senior managers from other parts of the company) may not be.
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Business partners, on the other hand, do see how procurement staff perform on these activities, so procurement managers should use their perspectives to get a more complete view of procurement employees’ performance and skills.
The procurement function at one manufacturing company in CEB’s client network of procurement professionals did so by developing “behavior-based” surveys to send to business partners that provided an objective view of employees’ strengths and weaknesses.
In the surveys, Procurement spelled out important “behaviors” (such as developing relationships or adapting to changing circumstances) that correlate with the company’s competency model. Procurement sent the assessments to business partners who worked with procurement staff, and asked them to rate the employees on their performance.
The function kept the surveys simple and sent them only once a year — outside of the company’s performance review cycle — to increase response rates.
If Procurement noticed any anomalies in the results — such as a significant increase or decrease in scores given by the same business partners from the previous cycle — the function would follow up through e-mails or meetings to understand their reasoning.