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product failure — these are all predictable . In other words , they are all gray rhinos .
So , how can you best prepare for them ? There are three things we think CEOs can do . First , they need to develop a deep knowledge of their supply chains : not only understanding where their suppliers are located and what they are producing but also forging better links with the suppliers of their suppliers — all the way back to the start of the chain . Second , they need to gather intelligence from suppliers who are a precious source of news about competitors ’ current and future products , information about up-to-the-minute trends , and the latest thinking on faster , better , and safer ways to source and make products . And third , they need to understand that the next crisis is not an ‘ if ’ but a ‘ when ’.
BC : Most people would think that suppliers and procurement are primarily the concern of the CPO . But , in your book , you say that it should be a CEO issue . Why do you think so ? DW : Even in the best of times , CEOs all too often fail to fulfill the lofty ambitions that they set for themselves when they took the top job . The urgent gets in the way of the important , short-term firefighting trumps long-term thinking . But since the outbreak of the COVID-19 pandemic , CEOs have been experiencing the worst of times . Amid all the turmoil , they have still been expected to do the seemingly impossible : cut costs while improving the quality of their companies ’ goods and services and while making their businesses faster , more innovative , and more sustainable .
It is my and my co-authors ’ view that out of all the different business functions , only the procurement function can help CEOs on all of these dimensions . Its role managing suppliers means that it holds the keys to the engine that really drives the company and its future . Very simply , this is why it is a CEO issue .
BC : One of your key points is that the job of procurement is more than just reducing costs . So , how else can procurement contribute to the growth of their company ? DW : Yes – in fact , this is the key point we make in the book . In most companies , CEOs instruct the procurement team to focus on purchasing goods and services from suppliers at the lowest price . But this limited instruction means that they routinely fail to capitalise on the team ’ s phenomenal potential to contribute to a company ’ s profitable growth .
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