Procurement can no longer go it alone. Managing a complex global supply chain calls for reinforcements from other departments, and this growing supply chain workforce offers some interesting challenges.
But to me, the challenges in managing the growing supply chain workforce are not rooted in stereotypical generational differences. If you’re looking for a typical workforce article that blames millennials for being self-centered, Baby Boomers for their lack of tech savvy or Generation Z for their all-consuming online habits, you won’t find it here.
Trite descriptions of the different generations in the workplace are a convenient excuse for managerial shortcomings. These typically negative descriptors are broad brushed attempts to classify the behaviors of tens of millions into high-walled silos that shortchange individuals and organizations alike.
While there are inherent generational differences around work style, relationships and career aspirations, it is those very differences and the blend of those fibers that make organizations stronger. I’ve given career advice to millennials, learned some neat tech tricks from Generation Z and worked on great project teams with my Generation X colleagues.
Instead, the challenges of managing the new procurement workforce lie in the assimilation of functions now called on to support my efforts in managing the global supply chain. The individuals and groups that join procurement may include planning, transportation and logistics, customer service, operations and other functions directly or indirectly supporting supply chain operations.
I am focused on their skills and not on their stereotyped generational traits.
Those from functions whose primary roles where not supplier facing need to understand their role in managing complex supplier relationships, respecting and protecting existing contracts and ongoing negotiations, and established supplier communication channels.
For procurement organizations, this new organizational reality is a positive step, but one not without caveats. They need to take the primary role in managing and educating this transitional and growing supply chain management workforce, namely on these four factors.
Law of agency
Buyers have the law on their side and are legal representatives of their company.
Those in procurement were once called purchasing “agents.” While some may view this as an old-fashioned term, it’s actually a legal one. Certain employees were given agency, or the authority and responsibility, to spend the company’s money. Individuals in procurement departments still maintain that legal authority.
Companies need to be careful with delegating responsibility for procurement with those who lack the necessary legal authority. And suppliers can get in hot water for accepting orders from those without the authority to spend money.
No matter the size of the supply chain workforce, the procurement department has legal agency for signing contracts and making financial commitments. They need to keep it.
Those with new or expanded interactions with suppliers must maintain the proper ethical standards. Sadly, some of the growing supply chain workforce may be under the impression that suppliers regularly provide gifts or more to customers. They may be quickly disappointed. Beware also that some suppliers may look to curry favor with these new contacts as an opportunity to gain greater entry into the company. Ethical breaches by suppliers? Shocking!
If there is one thing that drives suppliers, crazy it’s getting conflicting information from different people with shifting priorities. The procurement department needs to establish communication methods so suppliers can maintain contractual and schedule commitments and have their performance accurately tracked and measured. Often single points of contact between customer and supplier works the best to manage the flow of information.
Respecting and enhancing supplier relationships
The buyer is ultimately responsible for maintaining supplier relationships. It is important to educate everyone working with suppliers on a company’s procurement and supply management philosophies, including sourcing, the importance of supplier relationships, supplier performance analytics, contract commitments and the unique needs of specific suppliers.
A team-based approach to managing the supply chain is important. While the team should be able to develop expertise over time, prepare for a rocky start.
The new supply chain workforce is a complex one, but also a force multiplier. With the proper supply chain strategy, organizational structure and training, new supply chain employees can contribute to an effective and efficient global supply chain, positively impacting the operational and financial performance of their companies.
Even the millennials.
This story was first published in our weekly newsletter, Supply Chain Dive: Procurement. Sign up here.