Procurement divisions can do more to lead strategic initiatives that enhance value and reduce cost according to top management.
That’s the finding of Capgemini Consulting’s 2010 Global Chief Procurement Officer (CPO) Survey released today.
Almost 80 percent of professionals say top management expects them to improve the overall value contribution of the Procurement function.
Based on responses from over 150 global companies across Europe, Asia and the Americas, the survey reveals there is a clear and emerging focus on strategic initiatives that can enhance the value delivered by procurement.
These strategies include proactive value creation through innovation; contribution to corporate sustainability objectives; developing reciprocity agreements with suppliers; increasing speed to market and a focus on Total Cost of Ownership.
Cost reduction continues to be a major focus area with over 40 percent of respondents reporting savings targets at nearly 10 percent for 2010.
Strategies that Procurement executives are employing to achieve these targets include contract re-negotiation, tighter contract compliance, global sourcing, hedging and moving to outsourced procurement services.
There is a continued trend towards centralised procurement operating models with over 40 percent of the surveyed companies favouring this model and another 50 percent favouring a centre-led/hybrid model.
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