THE BUSINESS REVIEW FOR PROCUREMENT LEADERS
Pressure to raise performance means that CPOs are having to venture into uncharted waters. And yet, argues academic Adrian Done, after years of splashing around in rock pools, most purchasing functions lack the competences they need to land bigger fish in the deep sea.
Improving competence levels seems to be the obvious solution. However, in practice there are two problems: first, “competence” isn’t as straightforward a concept as it appears, since it is both multi-dimensional and context-specific; and second, the impact of competences on performance often isn’t properly considered. The danger for organisations is that they fall into “competence traps”, where development efforts stall or even have a negative impact.
Using the results of a four-year research project, the author proposes a framework of purchasing competence with six dimensions: employee competence, empowerment, communication effectiveness (with both internal functions and new product/service development), buyer-seller relationships and IT competence. Assessing the impact of each of these on performance measures such as quality, cycle time and negotiating ability enables CPOs to develop appropriate development programmes.
