10 Step Procurement Transformation, Part I

PurchTips edition #161


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How Do You Transform A Procurement Organization?

Your procurement organization is expected to continually deliver more and greater value to your company, but how? This step-by-step guide will help you transform your procurement organization into a world-class operation. Best of all, these steps can work for anyone, irrespective of department size or industry!

  1. Define the Scope of the Procurement Transformation – What is going to be different a year from now? Your organizational structure? The technology used? The supply base? What else? Make sure your goals are aligned with senior leadership's expectations for the transformation.
  2. Establish a Baseline of Your People, Processes, and Technology – How many of your people are degreed or have professional certifications? What percentage of your spend is under contract and how is your contract compliance? Document key findings and statistics of the current state to help assess the future progress of your transformation.
  3. Conduct a Gap Analysis and Develop a Transformation Plan – Prioritize the transformation initiatives on your plan by effort and impact. Target easy wins first to build momentum. Removing trivial annoyances such as ill defined category or contract responsibilities will help you to quickly gain the trust of the procurement team.
  4. Develop Key Stakeholder Relationships - Review your procurement transformation plan with key leaders to garner support and ensure organizational alignment. Seek their feedback on potential roadblocks. Be sure to discuss intended benefits of changes to organizational structures or company policies first, to avoid hitting a barrier later.
  5. Set Service Level Expectations – Avoid over promising at this point as you could lose credibility and support that is vital to success. Convey that service levels may decline briefly before increasing dramatically. Gain alignment on the transformation methodology you'll use, rather than arbitrary dates.

Do You Want a More Rewarding Procurement Career?

Are you tired of not getting enough opportunities, respect, and money out of your procurement career? Well, guess what? Nothing will change unless you take action towards becoming a world-class procurement professional.

Earning your SPSM® Certification is the action to take if you want to bring the most modern procurement practices into your organization and achieve your career potential. Download the SPSM® Certification Guide today to learn how to get started on your journey to a more rewarding procurement career!


Need Better Performance From Your Procurement Team?

Are you a procurement leader whose team isn't achieving the results you know are possible? Maybe it's not enough cost savings. Or frustrating performance from the supply base. Or dissatisfied internal customers.

You need a performance improvement plan that's easy to implement and quick to produce results. The NLPA can help.

Download our whitepaper "The Procurement Leader's Guide To A More Successful Team." You'll learn the 7 steps for transforming your staff into a results-producing, world-class procurement team.


Are You Getting The Most Out of Your NLPA Membership?

Members of the NLPA get more than just articles like this by email. As a member, you also get access to:

  • The Procurement Training & Certification Starter Kit
  • The latest Purchasing & Supply Management Salaries Report
  • Leading-Edge Supply Management™ magazine
  • Members-only webinars 10x per year
  • And more!

If you haven't been taking advantage of these benefits, why not log in and start now?