Johan Wedenius’ Post

I'm sorry. If 'Procurement' reports into the Head of Supply Chain and their biggest task is pushing POs, you've got yourself a Purchasing team. It's no different to describing a recruitment team as the People & Organisation function or client onboarding as your entire Sales function. But why is understanding the difference so critical? 💡 1. Purchasing is important, but it's primary emphasis is cost and availability, not total value. Businesses that understand the wider impact of a strategic Procurement function are far better placed to succeed over the long-term. 💡 2. Procurement as a function is largely misunderstood. I read a post the other day from a Procure Tech vendor trying to sell to a Head of Supply Chain, bemoaning their lack of buy in to A.I. There will not be a single Procurement pro who isn't invested in the value A.I. can bring. Wrong contact and a waste of time sales strategy. ___________________ 6 ways you know it's actually a Purchasing function 1. No Analytics: no measurement beyond costs so total value is missed 2. 100% Savings Driven: an imbalanced priority misaligned to functional needs 3. Supplier Conflicts: creating negative friction that slows business down 4. Hierarchy Driven: 'yes' people and thus lacking consistency and integrity. 5. Not Liked: poor reputation and limited stakeholder relationships across the business leads to low compliance. 6: No Strategy: no plan or alignment with the business, meaning no opportunity to improve year on year - Here's how Procurement does it: 1. We measure multiple KPIs that will all drive the function forward. 2. We manage the value, usability, feasibility, and viability risks of all decisions. 3. We build fair, transparent and collaborative partnerships. Suppliers enjoy working with us. 4. We're invited into Exec level conversations, not simply to agree or endorse, but to sense check, challenge and advise. 5. We're well known across the business and not just for what we do in Procurement. 6. We have an outcome led approach: preferably using the now-next-later framework. - And if you're new to an organisation, setting this up: 1. Discover the market and define a unique value proposition, initial vision, and strategy for your team. 2. Align your activities, prioritisation and success criteria to those of the functions you work with. 3. Meet with key suppliers early - not just at contract expiry/ RFP. Build trust, understanding and partnership early on. 4. Be clear on your value proposition and get senior endorsement of Policy within 3-6 months. 5. 'Walk the floors', get involved in cross functional workstreams, even those not directly related to Procurement. 6. Once you deliver, use your analytics and apply a continuous improvement approach to update the strategy a minimum every year. Do you agree? Disagree? Let me know in the comments.

I'm sorry. If 'Procurement' reports into the Head of Supply Chain and their biggest task is pushing POs, you've got yourself a Purchasing team. It's no different to describing a recruitment team as the People & Organisation function or client onboarding as your entire Sales function. But why is understanding the difference so critical? 💡 1. Purchasing is important, but it's primary emphasis is cost and availability, not total value. Businesses that understand the wider impact of a strategic Procurement function are far better placed to succeed over the long-term. 💡 2. Procurement as a function is largely misunderstood. I read a post the other day from a Procure Tech vendor trying to sell to a Head of Supply Chain, bemoaning their lack of buy in to A.I. There will not be a single Procurement pro who isn't invested in the value A.I. can bring. Wrong contact and a waste of time sales strategy. ___________________ 6 ways you know it's actually a Purchasing function 1. No Analytics: no measurement beyond costs so total value is missed 2. 100% Savings Driven: an imbalanced priority misaligned to functional needs 3. Supplier Conflicts: creating negative friction that slows business down 4. Hierarchy Driven: 'yes' people and thus lacking consistency and integrity. 5. Not Liked: poor reputation and limited stakeholder relationships across the business leads to low compliance. 6: No Strategy: no plan or alignment with the business, meaning no opportunity to improve year on year - Here's how Procurement does it: 1. We measure multiple KPIs that will all drive the function forward. 2. We manage the value, usability, feasibility, and viability risks of all decisions. 3. We build fair, transparent and collaborative partnerships. Suppliers enjoy working with us. 4. We're invited into Exec level conversations, not simply to agree or endorse, but to sense check, challenge and advise. 5. We're well known across the business and not just for what we do in Procurement. 6. We have an outcome led approach: preferably using the now-next-later framework. - And if you're new to an organisation, setting this up: 1. Discover the market and define a unique value proposition, initial vision, and strategy for your team. 2. Align your activities, prioritisation and success criteria to those of the functions you work with. 3. Meet with key suppliers early - not just at contract expiry/ RFP. Build trust, understanding and partnership early on. 4. Be clear on your value proposition and get senior endorsement of Policy within 3-6 months. 5. 'Walk the floors', get involved in cross functional workstreams, even those not directly related to Procurement. 6. Once you deliver, use your analytics and apply a continuous improvement approach to update the strategy a minimum every year. Do you agree? Disagree? Let me know in the comments.