What separates immature and mature organisations?

After learning about procurement’s maturity levels and how these correlate to strategic alignment, we can firmly say, that they go hand in hand.

What separates immature and mature organisations?

Well, within highly mature procurement organisations, 61% of respondents report that their procurement strategy completely or strongly aligns with the overall business strategy.

You understand that procurement and the company strategy are aligned in some way. Not one of our respondents with mature procurement functions indicated that procurement and company strategy did not align.

It is the degree of strategic alignment that is preventing your organisation from improving the procurement function.

And even once you’ve achieved complete maturity in alignment, this does not mean that you won’t run into any more issues.

With mature organisations facing challenges such as getting involved too late, not having access to the right technologies and systems, and not having the right people capabilities.

And this is where we circle back through to innovation being key to the progression of procurement as a function.

Supplier-led innovation is key for mature procurement functions. 28% of respondents indicated as much, but only 2% of them can currently deliver that exact innovation.

And why do we focus on the maturity of a procurement function being key to the success of a business? Mature functions deliver more value to external customers and can also focus on risk reduction.

With a greater alignment between your business strategy and your procurement function, you’ll see an increase in value and efficiency in the procurement process.

Which means finance and procurement can finally stop butting heads, and work closely together when it comes to delivering value to customers and ensuring expenses are kept to an absolute minimum.

2018 Procurement Study

What Finance can (and should) expect of Procurement

What is the 'value' of the Procurement function?

A study comprising respondees from 91 organisations, 42 from a Procurement angle, and 38 from a Finance angle.

So, what is reasonable for Finance to expect of Procurement?

  • Finance and Procurement often have different views of what it takes to implement the organisation's strategy. And the two are regularly misaligned in what outcomes they expect of each other.
  • Explore the relationship between Finance, Procurement and the rest of the organisation, beyond the various opinions you might have heard at the odd conference.
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