PurchTips edition #368

The business world often tries to distinguish leaders from managers. In this edition of PurchTips, we’ll apply this distinction to our profession. Here are three ways true procurement leaders are different than mere purchasing managers.

1. How one motivates his/her team. A purchasing manager’s primary motivational tool is “holding people accountable.” In other words, if team members fail to meet performance standards, the purchasing manager will discipline them. Unfortunately, that encourages in-the-box thinking, achieves performance that rarely exceeds minimum expectations, and creates a culture that will not retain higher-echelon talent. In contrast, a true procurement leader behaves in a way that inspires his/her team to achieve great things. A procurement leader encourages and praises innovative ideas that produce positive business results. As an outcome, true procurement leaders consistently get breakthrough performance from their teams while rarely having to “hold people accountable.”

2. What metrics have the highest priority. Purchasing managers give the highest priority to metrics like length of sourcing cycle, percentage of spend under contract, and number of suppliers in the database. Those are all decent things to measure. But, they are purchasing-specific. They don’t closely correlate with the strategic goals of the organization, which may include things like contributing best-in-class value in the supply chain, growing market share, and hitting earnings-per-share targets. True procurement leaders will give the highest priority to metrics that directly support the strategic goals of the organization.

3. How well the team understands its purpose. Purchasing managers are focused on getting the purchasing department’s work done. Subordinates of purchasing managers know what they have to accomplish, but they may not know why. Subordinates of procurement leaders always understand how their work contributes to the success of the organization, improves the lives of the ultimate customer, and/or makes the world a better place.

Are you tired of not getting enough opportunities, respect, and money out of your procurement career? Nothing will change unless you take action towards becoming a world-class procurement professional. Work your way up NLPA’s CPO Suite Programs, an enhanced version of our SPSM certifications and bring the most modern procurement practices into your organization and achieve your career potential.

Download our NLPA Course Catalog for a comprehensive list of the CPO Certification Programs and their corresponding modules per level.

Are you struggling to measure the impact of your procurement training investment? While procurement training is one of those rare investments that provides a return many times over, procurement leaders often have trouble quantifying the benefit.

Whether you’ve completed a training initiative or are just planning one now, you can put some numbers to its value! Download the whitepaper “Measuring The Impact of Procurement Training” and learn three methods for determining the return on your procurement department training investment.