By Geoff Peters
I was reflecting on a recent discussion with a CPO colleague, in which he was looking to hire a strong number two for his procurement team. The core deliverables for the role were meaty and required significant experience across a wide range of sourceable spend.
This critical hire would play a key role in moving the team and stakeholders to a S2P technology platform, where nothing had previously existed, and would introduce the organization to a strong, centralized spend influence. The person had to be good, and they had to be a candidate who could succeed the current CPO in the future.
How do you get beyond the resume—to focus on the attributes that really matter in a candidate?
The CPO and I had discussed a number of candidates, including their backgrounds and experience, and he had settled on some core attributes that I hear about often, but which are rarely explicit in a job description or even verbalized when talking about what makes a successful CPO. Let’s think through some of them and discuss how they impact the ability of a Procurement Department to drive value for an organization. After all, at the end of the day, our objective should be to create a competitive advantage for the enterprise, as well as to be able to maintain it over time.
So, while the candidate’s core skills and experience can’t be overlooked, it is still our job to understand if a candidate is going to be truly successful in an assigned role. In other words, we need to identify whether a candidate will be successful within the unique characteristics of your organization’s culture.
These four characteristics are important indicators for success:
1. An Analytical Mindset
- This does not mean necessarily having the ability to do a spreadsheet, but is much more about how the individual thinks through and sets up their approach to any business-related issue.
- “Analytical” most frequently means fact-based, prepared, and aligned with their team’s ultimate objective.
- This mindset usually links savings with investment and time with money, while seeking additional value measures beyond pure cost savings.
- Here is where benchmarking and assessment of a procurement department’s performance is crucial, measuring it both quantitively and qualitatively against peers and world class performers (the top 25% of all firms in both efficiency and effectiveness) to provide specific metrics.
2. A Big Picture Perspective
- Sourcing is a piece of the puzzle and part of the solution. As such, sourcing is rarely a standalone project or objective.
- This perspective involves an understanding of how the procurement team delivers value to the organization, as well as what the enterprise perceives as being a value-add.
- A comfort level with technology and process, as well as an awareness of how they integrate across procurement and the enterprise is vital for achieving this perspective. Ask the tough questions, like “How do changes impact the broader stakeholder and supplier community?”
This is often one of the largest gaps, as procurement departments often think that they are doing great, while stakeholders are not as equally enamored by their performance.
- Many successful sourcing teams work with their stakeholders across a wide range of goods and services. This is rarely done by decree or accident, as in many cases, the procurement team has to be persistent in looking for opportunities to add value.
- Persistence is an attribute that is critical when looking to expand procurement’s influence and impact across additional spend categories.
- This perspective approaches an evaluation based on what an individual has accomplished on the third or fourth attempt, rather than the first.
- In consulting, we call this “the airport test.” For example, how would you feel if you were stuck in an airport with an individual and you had 4 hours to kill because of a delayed flight? I don’t think that we can overstate just how important that test is to determine the future success of an individual and their fit within the culture of an organization. Case in point, our team needs to be likable.
- Stakeholder Surveys can be an unbiased gauge of likability, where a procurement department’s perceived performance (how well they think they are doing) is compared to the stakeholders’ ratings of their performance (how well the stakeholders think they are doing). This is often one of the largest gaps, as procurement departments often think that they are doing great, while stakeholders are not as equally enamored by their performance.
- We will be much less successful if clients cringe when they see us coming, or as I hear all too frequently, “so and so doesn’t want to work with ‘Fred.’” You must ask yourself, “Is your candidate somebody who you will be comfortable traveling with, and perhaps even socializing with on occasion?”
So, we now have a candidate who has passed muster with our HR Sourcing or Recruiting Team and who has an impressive list of accomplishments. In fact, they show a 22% savings in sourcing specific indirect categories!
Now, let’s put the sourcing success on a candidate’s resume in perspective. After all, they did save 22%! But, let’s have a conversation with the candidate that focuses on what happens “between the accomplishments,” mainly focusing on these core questions:
- Was it one of the larger and more strategic spend commodities of the organization?
- Was the candidate able to grow the sourcing effort beyond a contract renewal into a true, category management review that looked across the enterprise, while working with multiple stakeholders?
- Did they approach the sourcing effort analytically and do their homework to understand the underlying cost drivers and the future business requirements, not just the historical spent volume?
- And, of course, where did the effort require additional review in order to ultimately arrive at an optimal solution for the organization?
Asking such probing questions that center around analytics, the environment, and problems that had to be tackled is critical to understanding how this individual will create future value for your organization.
Other questions include: “Can they talk about relationships they have developed over time that allow them to access data and insight because they are someone that people want to work with?” And, of course, “Will this person fit in with your co-workers, being someone they could go out for a drink or dinner with at some point in the future?”
n the example that we started with, the candidates were subjected to interviews with stakeholders who were outside of procurement and were looking for somebody with unique expertise who would benefit their specific business’ requirements. In this type of external interview gauntlet, few candidates are going to be successful, since there are many people who can say no, and it is difficult for each of them to adopt the big picture perspective that allows them to see value across the organization.
If your HR and recruiting teams have done their homework, all of your candidates should meet the minimum requirements that would allow them to perform the job.
For this reason, at the potential risk of some stakeholders being excluded, it is critical to keep the interviews at a senior-enough level, so that the interviewer can be looking for possession of critical attributes versus a disqualification based on their particular bias. This company failed to do so in this example, and because of that, they did not make an offer to an outstanding candidate.
If your HR and recruiting teams have done their homework, all of your candidates should meet the minimum requirements that would allow them to perform the job. However, to be truly successful, your procurement team needs to have an analytical mindset, a big picture perspective, persistence, and likability, as only those characteristics will truly set your team apart and make it successful within the culture of your organization.
Geoff Peters is a Principal with The Hackett Group, an IP-based Consultancy. His teams specialize in procurement assessments, benchmarks, and transformation. His industry background includes work at SC Johnson, Chase Bank, and Sears Holdings, and his clients include some of the largest and most successful manufacturing, financial services, and technology companies in the world.