If you are new to procurement or are willing to work in this field you are stepping into a great profession. Here are ten reasons why we love procurement:
1. Procurement is exciting
Procurement definitely isn’t a routine job in which you spend hours behind your desk doing the same thing every day. Each new day in Procurement is not the same as the previous one. In today’s fast-changing dynamic business environment, you cannot expect what challenges you will face. You are always looking for new products or searching for new suppliers, to meet the variable requirements needed for business operations. In procurement, you will not be bored.
2. Procurement gives Incomparable Exposure to other Business Leaders
Procurement will give you the opportunity to meet with people in your early professional years, that you may not even imagine that you will meet in other professions. You will meet Sales Directors, Commercial Directors, Business Development Managers and even CEOs. Sometimes those people may eagerly want to meet with you in order to show you their products or to discuss a huge deal that may increase their profitability and reputation.
3. Procurement is global
Working in procurement is a global profession. You may buy things from the global market or work with a global company. You can easily move around the world working in different positions and companies, still within the procurement profession. The great thing about procurement is that it is the same all over the world. If you move from one company to another or from a country to another, you will not find many differences. If there are any it will be according to the maturity level of the company.
4. Procurement is the new competitive advantage
Perhaps the ultimate source of competitive advantage for modern companies is effective supply management. If you are working in a manufacturing company, retail or even services you will realise that producing products faster and getting them to the market faster means getting paid faster. This will differentiate successful companies from others. So effective procurement in satisfying production and operation needs makes this fast market penetration happen, which increases a company’s profitability and success. The value chain of modern business is no longer about production engineering, but effective supply chain management that enables companies to produce at low cost without neglecting rigorous quality standards. Or alternatively to quickly convert products concepts to real products and respond swiftly to market peaks or troughs in demand, taking new products from concept to reality in rapid time.
5. Procurement is strategic
Around 60 to 65% of companies costs nowadays are spent on materials required for production, so procurement professionals now have a greater role in their companies and direct access to CEOs and CFOs as they have an impact on strategic decisions taken by decision makers. Decisions such as what materials to procure or from where to source the required materials, what suppliers to have long term relationships with or those to cease working with. These decisions have a direct impact on the strategic direction of the company and have a direct effect on a company’s profitability, sustainability, and long term performance.
6. Procurement is challenging
If you are the kind of person who likes challenges, procurement is the right profession for you. It will take from you a huge effort to orchestrate the activities of a supply chain that spreads over different countries. This includes hundreds of suppliers and suppliers of suppliers to source components and parts needed for operations. While doing that you need to manage effectively the risk of increased market volatility and sudden international supply risk. Also taking into consideration the legal and ethical requirement of product safety and ethical issues such as forced child labour that may harm your company’s reputation if neglected.
7. Procurement looks forward
Unlike finance and HR who spend most of their time analysing past data to get a better understanding of the performance of the company and employees; procurement focuses on future needs. It is the decisions in which procurement takes that shapes the future of the company.
8. Procurement develops a diversity of skills
Working in procurement requires the professional to have a set of basic skills such as negotiation skills, administration of paperwork, and compliance with procurement rules. But these skills are not enough for succeeding in today’s procurement practice. The additional set of skills required are CEO type skills such as Strategic thinking, Leadership, Understanding markets, Innovation, and creative thinking, predicting change and managing risk, and effective communication skills and internal collaboration.
9. Procurement is a fast growing profession
As mentioned in CIPS salary survey report, “Despite a turbulent economic and political year, the appetite for procurement hires has continued to increase. 70% of organisations are looking to hire this year, up 6% on last year. This spans organisations in both the public and private sectors, and is an indication of confidence in the market”. Procurement as a career path doesn’t end by being a procurement manager or director but it can lead you to be a CEO of a company and we have good examples such as Tim Cook (CEO of Apple) or Mary Barra (CEO of General Motors).
10. Procurement pays well
Hot issues such as mitigating corporate risks, maintaining ethical standards or even managing outsourcing relationships, keeps modern CEOs always in alert mode. These issues need qualified procurement experts to manage. This demand has resulted in significant earnings increases for professionals. According to Procurement Salary Guide and Insights 2017, in UK; “For the third year in a row, we have seen an overall growth in salaries, both within the profession itself and in comparison to other disciplines, at 5.3% compared to a national average of 2.2%. 64% of respondents received a pay increase (compared to 68% in 2016 and 61% in 2015,) with the average salary at £44,936”. Within Australasia in the last 12 months, 66% of respondents received a salary increase – a slightly higher proportion than the 64% in the UK – while 31% received a bonus. The average salary is 139,500 AUD. In MENA region and despite the challenges due to the oil shock of the last two years, the highest average salaries are being seen in the Private Sector and the average salary for all procurement professionals is £56,000, which is higher than the UK average of £44,900. In the last 12 months, 51% of respondents received a salary increase, a smaller proportion than in the UK at 64%, and 41% received a bonus. Of course, if you certified you are paid higher than your peers.
Finally, you will not realise how interesting and fascinating the profession of procurement is until you start working in it and once you do you definitely will fall in love with this vocation.