PLANET
It all goes to show that without functioning supply chains , the global economy grinds to a halt
Daniel Weise Global leader of Boston Consulting Group
war in Ukraine . Business leaders , struggling to get essential raw materials , components and other parts , are realising that they failed to pay enough attention to suppliers and their procurement function . Also , they need to find a way to generate profitable growth as they emerge from the various crises . They are urgently looking for answers – for solutions . This book has them .
BC : This is a book about procurement and supply chains , but is it also essential reading for any CEO right now ?
DW : Absolutely . In fact , the CEO is the main , target reader of Profit From The Source . There are two reasons . One is this : We know that , as with most things in a company , if the CEO doesn ’ t get behind something , it won ’ t happen . But the bigger reason is that we believe suppliers and procurement should be strategic , and therefore by definition , CEO priorities .
Indeed , our # 1 practical principle , the first of 10 , is : Start At The Top : Make your Suppliers and your Procurement Function Leadership Imperatives . It is only when they are deemed strategic priorities and leadership imperatives that they can have a positive impact on corporate decision-making and the future direction of a company .
To make them strategic , CEOs must do a number of things . For example , at a personal level , we recommend that they spend more time with suppliers . Research from Harvard Business School suggests that CEOs spend just 1 per cent of their time with suppliers – the equivalent of seven minutes a day . That ’ s not enough . In particular , they should nurture one-on-one relationships with the CEOs of their top suppliers – the 20-40 companies that account for half of their supplier budget . At a company-wide level , they need to change the mindset , so that procurement is regarded as an important business capability . One effective way to do this is to elevate the role of the chief procurement officer
82 July 2022