Brexit maybe seen as doom and gloom for some professions, but it can be argued that it is a golden opportunity for procurement to shine and demonstrate its true value to organisations A recent survey reflected that one in four senior procurement practitioners expected the departure of the UK from Europe to heighten the status of procurement within their organisations.
The lack of recognition of the procurement function is one of the long-standing barriers between aligning the organisations corporate strategy and the procurement strategy for the business, something that is fundamental in-order to achieve value, competitiveness, and innovation. CEOs and senior management now need to realise that it is the procurement function that could be the biggest assistant in steering the organisational ship through the formidable Brexit sea of uncertainty. Totis Kotsonis, a lawyer and partner at Eversheds, advised that “there are ways of creating some certainty out of uncertainty’’ and that organisations can create certainty by modelling the effect of the most likely Brexit scenarios.
What does procurement need to do?
Expense Reduction Analysts (ERA), reflected “Procurement teams need to be braver and more vocal than ever before. Uncertainty presents procurement professionals with a real opportunity within organisations to initiate change.” Therefore, now is the time for procurement to step up and prove its worth. This will mean developing strategies that reduce the risk of supply chain failure and develop more flexible, agile supply chains outside the EU that will absorb costs, be more risk averse and value driven . There will be a need to manage exchange rate fluctuations by strategically hedging via financial instruments and a real need to manage stock levels, increasing stock at the optimum time to take advantage of price instabilities.
Consequently, procurement with the support of senior management, needs to begin strategising now, otherwise they may be left with a sinking ship.
By Debbie Metcalfe LLM MSc MCIPS – Achilles