Your Procurement Team is Too Old, and becoming Too Young

This past weekend my family and I arranged a 90th birthday party for my Grandma.

90 years.

Not to get all existential, but it really puts life into perspective when you’re sitting next to a person – eating ice cream and cake – that has lived 6 decades longer than you.

As the saying goes, we know what we know. And, in this case, my grandmother and I have had completely different life experiences. I was a child of technology, information and stability. She was a child of the depression, living in poverty, circumstance and uncertainty.

Realizing that I had never really asked my grandma about her childhood, I took the time to inquire as we shoved our faces with cake.

She was born and raised in a borough of Washington DC. Her mother was an immigrant and her father came to America as a young child. They owned a grocery store in the Jewish ghetto, and lived over top of the store in the same building. She lived and worked there for 16 years. During WWII, owning the store was an advantage because her mother was in charge of rationing. People were so unimaginably poor. There was an ice factory across the street and the workers would want to buy cigarettes, but they couldn’t afford a 10¢ pack, so her mother would sell ‘loosies’ (single cigarettes) for 1¢ a piece. Flash forward 30 years, and she lived through the Vietnam War and the American Civil Rights Movement. While segregation was a not-so-distant memory, flash forward another 40 years and she saw an African American man become President of the United States. For her 89th birthday she got an iPhone. Three months ago I taught her how to use Facetime and order an Uber. The year she was born, sliced bread was invented.

It made me realize, sharing our life experiences through story was the closest we would ever come to understanding each other’s reality and past. She doesn’t know what Instagram is, but she remembers the assassination of Ghandi in 1948. She admires my ability to utilize technology, and I admire her surplus of experience and knowledge despite her ability to use technology. We’re from different times, and we’re consequently hardwired to think and act differently. She can aspire to become more technologically savvy, and I can aspire to learn about the history and experience she’s lived, but we’d never be able to achieve an innate level of knowledge.

The vast majority of people retire from their careers long before the age of 90, but there are plenty of executives, VPs, directors and managers in their 60’s and 70’s. At the same time, there is plenty of 20-somethings starting at entry-level positions. It’s a head on collision of two different worlds. How do these two age groups align in the work place? How do they overcome the natural chasm in technological competencies? How do they share knowledge and experience without discounting the abilities of the other group?

It’s time to start finding answers to these questions, because your procurement team is too old, and it’s about to become too young!

Traditional Procurement

Traditional procurement typically gets a bad rap for exuding non-agile attributes.

While these notions may be fair, the bottom line is, most organizations still have core elements of their procurement teams that are rooted within ‘traditional’ practices.

“A traditional procurement process is characterised by manual events, including many small, repetitive tasks. These tasks could be anything from approvals, writing RFxs contracts, negotiations and discussions of bids” (Claritum).

Often, traditional procurement practices are time consuming or demanding of resources. Paper trails of approvals or invoices, physical document management, and calling between buyer and supplier are some classic signs of traditional work processes. Do you recognize your own organization in this description?

Traditionalists within procurement have been seen to work with suppliers within a framework of price-based procurement. Price-based procurement is when a manager purchases focused solely on cost (from the lowest bidder), turns a blind eye to quality, tries to control the contract, and disregards the suppliers’ competencies.

Organizations are moving away from the price-based procurement, and beginning to focus on value-based procurement. While this is a good sign for the creation of shared value across industry sectors, there are elements of traditional procurement that were rooted in a useful practicality and pragmatism.

It raises the question…Will the new generations of procurement professionals disregard the significance of traditional procurement all together? Could the toolbox of traditional procurement (negotiation, relationship building and price-focus) be useful for modern teams to revisit?

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