CPO-led transformation is as much internal as external
By Ilkhan Ozsevim, editor of Procurement
Costas Xyloyiannis, CEO of HICX, in a recent Supply Management article outlines how CPOs can forge valuable transformations that last
Costas Xyloyiannis, CEO of HICX, the low code platform for Supplier Experience Management (SxM) has been a regular contributor to Procurement Magazine, covering issues as divergent as sustainable procurement, digitalisation, supplier relationships, net-zero, sustainability and SxM.
In a recent article on Supply Management, he delves into the subject of how Chief Procurement Officers (CPOs) can break free from the status quo, which, he views under certain circumstances as a hindrance to growth and progress.
Since ESG has been elevated to a prominent position on the board’s agenda in recent years, the task of capturing, analysing and reporting compliance and readiness across various areas has become crucial, and leaders are now seeking to delegate this responsibility.
Under the circumstances, management faced challenges identifying the department responsible for suppliers across their business. To solve this problem, they turned to procurement. Chief procurement officers (CPOs) rapidly implemented point solutions to meet their mandates while keeping established source-to-pay and procure-to-pay suites to manage sourcing and spend.
However, it soon became evident that specialist solutions could not always integrate with the suites. This led to the frustrating experience of swapping between the two, not just for procurement teams but also for suppliers. Recent research suggests that suppliers waste a considerable amount of time navigating through eight tools to serve a single customer. Each tool requires a password, and supplier data is full of duplicates, gaps, errors, and inconsistencies.
Organisations must make a choice to accept things the way they are or find a way forward. The journey towards a seamless environment where both parties can work together like partners in the same ecosystem is rewarding but not easy.
This environment enables suppliers to produce quality work with pure data, and procurement can thrive with access to expert solutions that deliver cost savings, ESG reports, sustainability opportunities, innovation, and unlock broader value for the organisation.
They must revolutionise how they view suppliers and the digital landscape’s architecture. This involves investing in expensive teams and tools, which raises the stakes. Despite the enormity of the task, many enterprises have undertaken this journey and are reaping the rewards of supplier success.
The first step towards achieving supplier success is to re-architect the digital environment to remove all supplier friction. Everyone in the organisation who engages with this network must be on board. The key move is to abolish all friction that gets in the way of supplier success. Organisations must identify all process pain points that suppliers experience and understand them from the supplier’s perspective.
This requires gaining insight into the supplier experience, which can be achieved by caring, stepping into their shoes, and conducting surveys. Other pioneers of the supplier experience movement have followed a data-first approach to remove blockades by consolidating and hosting all supplier data in a central platform, which is then governed and pushed to other tools integrated and share a single password. Organisations can then rebuild the digital environment to make master data a priority, automate workflows, and transform the supplier experience.
To make this transformation possible, all senior leaders, including those who are traditional and resistant to the change, must be on board. Leaders must be shown how supplier experience management works in other scenarios with investors, employees, and customers. Leaders must be aware of the missed opportunities and potential risks caused by a fractious supplier environment and how a more harmonious setting can reap rewards. Therefore, organisations must win over the naysayers and gain their support.
In summary, Xyloyiannis holds that organisations must make a choice to either accept the status quo or to invest in a more harmonious supplier environment. He emphases that the journey towards achieving supplier success is challenging but rewarding.
To achieve this, organisations must transform how they view suppliers and the digital landscape’s architecture. They must identify all process pain points that suppliers experience and understand them from the supplier’s perspective, and they must adopt a data-first approach to remove blockades by consolidating and hosting all supplier data in a central platform, which is then governed and pushed to other integrated tools that share a single password. Finally, leaders must be won over to ensure the organisation’s success.