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21 August 2011 | Angeline Albert

CPOs must improve staff training in areas that are critical to procurement such as analytical skills, supply chain and supplier management, according to research by the Aberdeen Group.

The research group’s report Dynamic Procurement, the CPO ascollaborator, innovator and strategist, which is based on responses from 121 purchasing, supply chain, operations and finance professionals who were surveyed in June, reveals the most critical competency required is the ability to be analytical (36 per cent of respondents). This was followed by financial analysis (30 per cent), implementation planning (30 per cent) and business case development (26 per cent).

Respondents said they plan to improve training in the future in category and supplier risk management, financial analysis, and supply market research.       

The report revealed that the largest barrier to strategic procurement is a lack of staff with appropriate skills (47 per cent). This was followed by a lack of technology and inadequate spend management technology infrastructure (37 per cent). A total of 37 per cent said procurement not being seen as strategic was an issue and 36 per cent said their organisation’s reluctance to follow or adopt processes recommended by procurement was a challenge. CPOs need to improve category expertise and encourage cross-functional working between procurement and other teams to increase visibility of the function, it said.

The survey found the main pressure facing CPOs continues to be a top-down directive to identify and cut costs. With increased supply chain disruptions from the impact of natural disasters in Japan, geo-political conflicts in the Middle East, and the European Union debt crisis, the second biggest pressure was the inflationary impact on critical spend categories/commodities. This was followed by increased complexity in supply chains as a result of globalisation; rising supply risks (i.e. supplier’s financial health and ability to perform); insufficient category expertise; and a lack of proper data to drive category strategies.