21st Century Procurement Skills (Guest Post by Christoph Flöthmann)
Our guest post today comes from Christoph Flöthmann, an expert in strategic and digital procurement, who has recently co-authored a new report.
Digitalization already has a major impact on procurement, as we write in our new report: 21st Century Procurement Skills. Thanks to artificial intelligence (AI) and robotic process automation (RPA), process-mining tools can be used to reshape and analyze all kinds of processes. Dashboards, governed by analytics bots, help to detect and prevent maverick buying in real-time without any human input. This is ultimately driving procurement effectiveness, efficiency and compliance. However, the digital transformation can only succeed if procurement has bright talents with the right skills in place who steer AI and manage the remaining high-value-adding tasks: First, digital fluency is a new meta-competency that enables managers to reach their targets by being in command of digital tools. Second, the ability for complex and collaborative problem-solving will be key to master the challenges posed by both digitalization and uncertain markets. Because AI and RPA take over tasks that are rather simple and require a low level of human collaboration, the procurement professionals’ scope is about to shift to highly complex and highly collaborative tasks such as developing and approving category strategies. Finally, procurement needs transformational leaders that are able to empower their teams to strive for developing and applying their new skill sets.
Dr. Christoph Flöthmann is a consultant in Roland Berger’s Operations Competence Center. In 2018, he and his project team were finalists at the World Procurement Awards in London for developing and implementing a digital procurement strategy platform. Before becoming a consultant, he completed his Ph.D. at Copenhagen Business School and Kühne Logistics University, specializing in research on competencies and careers in supply chain management.
I agree with this post; however, my area of focus is CSR and I am quite concerned that now that organizations have the capability to develop much stronger compliance using AI, as well as video of factory labor compliance, automated compliance of chemicals in factories, compliance at the 2nd and 3rd level suppliers, etc. that many companies will no longer be able to hide behind “it is not possible to have 100% compliance because that is just the reality in developing countries”. How will they be able to say they are compliance with their certifications when they may have not intention of really building compliance systems through the supply chain. I just had a disturbing discussion with the CSR of a leading European clothing firm who is building a strong CSR program as they tell it, but has not plans to expand compliance beyond 3rd party audits and training. My rejoinder: if 3rd party audits are good enough, then why have there been so many terrible accidents in factories and why is textiles the second most polluting industry in the world?
My motto: Compliance talks; greenwash walks.