Home / Logistic and Supply Chain Management / CIPS Paper – The Future of Procurement and Supply Management

CIPS Paper – The Future of Procurement and Supply Management

via Spend Matters: As we said last week, we will be looking at “the Future of Procurement” over the summer.

The recent CIPS publication, The Future of Procurement and Supply Management (P&SM) is the first research from “academia” that CIPS has commissioned for 15 years, which says something (not very flattering) about CIPS – but credit to the Institute for getting back into that world. However, this is a real mixed bag. It is aimed at stimulating debate and thinking in the community, and we hope it does so, but it does require some concentration to get the most out of it.

The work was led by Dr Joanne Meehan of Liverpool University and Dr Louise Knight of Aston University. Meehan has written for Spend Matters and we’ve met, liked and respected her and her work, so this has been a tough critique to write. As well as their input, there were apparently multiple workshops and discussions with practitioners. (OK, yes, I’m a touch surprised no-one talked to me, but they probably reckoned I’ll be so ancient in “the future” that my views are not worth considering!)

The format is that initially the report paints two alternative visions of the “business landscape” – the timeframe is 15 years, which seems quite a long way forward. Those visions are described in some detail, but almost totally in terms of business matters, so there is no sense really of how wider issues might drive change. Political, cultural, health, social-media or other drivers will certainly play into the future of procurement.

Now we’re told this was a “scenario planning” approach, so they are not meant to be predictions, rather they were scenarios used to stimulate discussion with the participants in the various workshops and interviews. But I found the scenarios somewhat distracting – you can’t help thinking, “oh, that will never happen!”

After the description of the scenarios, the report gets into what they might mean for procurement and supply chain management, and the different issues that need to be considered. Spoiler alert – that “part 2” of the report is much stronger than part 1, so one fear is that many readers may never get to some of the more interesting content.

That leads into one of the issues that may have affected the value of the end product. Of the two visions, the one titled “Titans”, which describes five firms dominating pretty much every aspect of business, seems to have been suggested by the people in the workshops, and you get the impression that the academics did not think much of it themselves!

That is perhaps why it is described in such dry and frankly boring terms, sentence after sentence being in the form of “(something) will be (something)”. Unbelievably, across the first two pages of the “Titans” section, the main verb in the sentence is “will” in 40 of the 41 sentences. I know what our esteemed editor, Nancy Clinton, would have said to me if I had written something in that format. We understand that was how the scenarios were presented to the workshop participants, in order to immerse them in the scenario – but for this final report, we might have tried to make it all a bit more varied.

So readability is an issue; but there seem to be clear contradictions that make the “Titans” concept lack some credibility. How can you have a “wild west” of de-regulated business, but also see protectionism as a dominant force – protectionism is the ultimate regulation of course. If the Titans (Facebook, Amazon, Apple, Google and Microsoft) are so dominant, why would innovation increase? And “buyers will spread their purchases across more suppliers” does not fit with this market dominance model either.

There are just too many points like that which look incoherent and make the reader frown. How would any sort of competition law allow those firms to dictate that suppliers could only work with one of the big firms? And I really cannot make any logical sense of this:

“Rising labour costs in low cost countries and extensive automation will have led to re-shoring as local suppliers became more competitive. While cost of automation remains high, it will mainly occur in developed nations. As costs fall, automation will increase in former low-cost countries, their prices will fall and there will be a swing back to global sourcing. This will lead to corporate failures in developed nations, and mass unemployment in the low-cost countries”.

The second “Networked” vision seems to be the one the academics feel more comfortable with and the writing here is a little more engaging although the curse of the verb “will” is still much in evidence. But it goes so far towards a “hippy” version of the future, one starts to question again the likelihood as we read about more co-operatives, the circular economy and so on. Its all a bit Woodstock, and again there are contradictions, although not as obvious as in the “Titans” section. But there is no explanation for why inequality might decrease (it will take huge political, social or economic forces to do that globally over coming years), and the authors mis-understand why consumers buy brands.

So for me anyway, the two visions thing doesn’t really work, and the problem is that once you lose confidence in those two overall pictures, you tend to disregard the elements that may well make sense. I think if I’d been doing this, I might have looked at maybe 10 different key issues, examined possible futures in each and then considered the impact on PS&M rather than pinning everything on two scenarios.

However, it appears that the scenario approach was taken to try and shake the procurement participants out of a current (and historical) mindset, and get them really focusing on the future – so we can appreciate that perhaps our approach might not have achieved that successfully either.

Coming back to the omissions too, while protectionism is mentioned, there is nothing about issues that will have a huge impact on business and PS&M – immigration and the emergence of nationalism, the rise of China and Africa, nothing on the psychological impact of social media and the rise of Millennials … I just didn’t get a sense that these two worlds were real in any way, or likely to be real.

But more in part 2 when I promise we will be more positive!

About Editorial Team

Check Also

supply_chain_technology

Transforming the Supply Chain with AI, IoT & Blockchain

via TECHNATIVE: Getting products from A to B is one of the most fundamental challenges in …