The BIG SEVEN in 2023 for Procurement Series: #4 Job Security and the Talent Wars

Posted by Mita Gupta on Jan 30, 2023 6:24:46 PM
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By Mita Gupta, Board Advisor at Mintec

Before we get into the heart of our discussion on the current talent landscape in the procurement industry – including the need for job security, let's consider some recent industry chatter and insights.

To start, did you know that a survey of CPOs over five years before the pandemic revealed that most believed that their procurement teams didn't possess the necessary skills to enable them to achieve their strategic objectives?

Another survey reported that 50 percent of procurement professionals who would choose another profession if they could, were part of the newer generation, e.g., employed for less than two years.

Finally, a 2021 Bureau of Labor Statistics report stated the following;

  • Overall employment of purchasing managers, buyers, and purchasing agents is projected to decline 6 percent from 2021 to 2031.

  • Despite declining employment, about 47,400 openings for purchasing managers, buyers, and purchasing agents are projected each year, on average, over the decade. All of those openings are expected to result from the need to replace workers who transfer to other occupations or exit the labor force, such as to retire.

In the context of the above, let's talk about the talent wars and the nature of job security in the procurement profession, including talent engagement and retention.

The Prelude to War

A few of the above insights were surprising, notably that the newer generation would prefer to find another profession.

While some in the industry talk about replacing "industry dinosaurs," it is hard to envision "generation next" being part of that exodus.

Because of the explosion of intuitive procurement technologies coupled with generational events like the pandemic and war in Ukraine, those who adhere to the transactional mindset of the past might find the industry changes somewhat challenging. The findings from the survey of CPOs indicating that they did not believe in their current team's ability to meet their strategic objectives mean that a talent shift is likely inevitable.

However, and this is what is surprising given the opportunities for those new to the profession, it is a very exciting time! There is now an awareness of supply chains' importance because it touches all areas of everyday living. The continued emergence of digital (AI-driven) technology and moving from a functional or transactional past to a strategic, relationship-based focus makes the procurement industry one of the most attractive to younger people. Adding into the mix the emergence of ESG-based priorities – a topic that a 2021 article found was a hot button for this generation of professionals, and therefore can't see anyone in this new demographic wanting out.

Maybe a new professional exodus has less to do with individual choices and more with the static or stagnate mindset of the organizations for whom they work.

A Talent Development System 

In his November 2022 article "Procurement's Version of the Peter Principle: Are We Setting Up Our Future Leaders for Failure," Iain Campbell-McKenna writes:

"It seems that the issue regarding talent development and the maturation of experience and expertise to work at a senior level within organizations is lacking. As a result, the mindset of most procurement professionals is that the only way to get ahead is to switch companies." McKenna then observes, "but what are they moving up into at a new company? What are they taking with them in the way of industry knowledge from a former employer?

This take suggests that there may be too much volatility for those staying in procurement versus pursuing another career path in a different field. It also puts forward the thought that the war on talent and the quest for job security is more of a battle from within the procurement profession itself than it is by the influence of external forces.

If this is in fact the case, the question procurement leaders must ask and answer is how the industry will quickly evolve with these trends, to not only retain good procurement talent but also to allow them to flourish in their careers.

Next Up: Part #5 - Supplier Relationships

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Topics: Commodities, Procurement