Did we need to add a new acronym to our vocabulary? VUCA.
VUCA stands for volatile, unpredictable, complex and ambiguous; it is the word that summarise the world in which we currently live. In many ways, we have always lived in a VUCA world, but the nostalgia can often make it seem that the world was less VUCA in the past.
Whether the world is increasingly more VUCA, the truth is that the role of procurement is certainly being affected by the levels of volatility, unpredictability, complexity and ambiguousity in the world.
So what is the antidote?
How do we balance out the high-levels of VUCA infiltrating our work environments?
Well, perhaps its through innovation? Bertrand Maltaverne put it in his article “Innovation Isn’t About What You Control, But What You Can Access. The Procurement View”: no one is too big to fail or immune to the VUCA of our world.
Procurement can play a crucial role and indeed, has a responsibility to manage innovation but only if the procurement team is capable. For us to understand the role procurement can play in innovation, it is important to acknowledge that innovation rarely occurs in isolation. For the spark of creativity to ignite, fuel is needed, and that fuel usually comes from interacting with the world beyond a given organisation.
Procurement professionals have plenty of fuel interacting with suppliers.
Whether it is existing suppliers – bringing new solutions to our attention or new suppliers offering their take on problems and solutions, procurement has the potential to see the innovative potential that other organisational units might not.
From cost centre to profit centre.
Furthermore, according to the Hackett Group, procurement in many instances is lagging behind in the innovations that are already underway. Namely, while procurement leaders know that digital transformation is vital to the future of procurement, most believe that they do not have the necessary strategy, talent and competencies in place. But the digital transformation is also at the heart of how procurement can go from a cost-centre, obsessed with savings to a profit centre and an ideas hub.
Procurement, through interaction with suppliers, through the management of supply chain, logistics and other related activities has the potential to gather vast quantities of data that can be harnessed to create a map that can be used to navigate our the volatile, unpredictable, complex and ambiguous world.
In the process, procurement has the potential to be the crucible of innovative ideas that are fuelled by the trends and insights that the procurement’s data repositories yield up. But if procurement lacks the right competencies, then it will remain still in a world that is moving forward and as a result, fall behind simply by standing still.
Do not stand still and do not let the VUCA overwhelm you. The Global Procurement Benchmark can help you evaluate your competency on the global stage and layout a roadmap to help you gain the competencies necessary for digital transformation and innovative thinking. Register for free here.