Soile Hammargard, is a procurement executive who is passionate about driving change in dynamic and complex business environments. She has experience across telecommunications, chemical, and pharmaceutical industries and is presently serving as Chief Procurement Officer at GlobalConnect, one of the leading digital infrastructure and data communication providers in Northern Europe. Soile added some colour to our questions on new skillsets required for procurement and how to earn that seat at the executive table.
Soile, lets start with tried and tested seat at the table question. Procurement wants the proverbial seat at the table. What does it need to do to earn that seat? What can procurement achieve with this seat?
It depends a lot on the industry and the maturity of procurement organisation. That will impact how it is perceived. I would argue that procurement has been at the top table for a long time in manufacturing, especially within the automotive industry. However, for procurement teams striving to climb out of being boxed as administrative functions I would give these pieces of advice.
Firstly, ensure to set targets that are clearly aligned with the company strategy. Make it very clear that procurement is not competing with the rest of the business (if KPIs are conflicting this might otherwise happen). Procurement is a trusted advisor on how to enable other commercial functions such as sales, technology, and delivery to meet their targets with the help of a healthy and engaged supplier base.
Secondly, communicate! For example, about what is happening with suppliers, what kind of benefits have been achieved with procurement practices and what kind of support is available. Focus on positive communication rather than policing if the rest of the company follow processes and mandates. Market and brand procurement as a business friendly function and the supplier base as a source of unique competitive advantage.
Procurement is evolving at pace. The pace of change often calls for new skill sets and disciplines within a team. What should procurement be doing in this regard and what value can procurement source from adding non procurement skilled staff to their teams?
I think it is always important to bring in new and complementing skillsets to a procurement team or any team for that matter. It depends a lot on the industry what is most relevant. However, if I would have to pick one area, then I would pick risk/ crisis management skills. I think the pandemic developed a whole new awareness and capability in the workforce to manage risk. There are also multiple new European laws and directives aiming to make companies accountable for 3rd party risk management in fields such as sustainability and cybersecurity. This is where the procurement team can bring a lot of value to the table with professional supplier selection and lifecycle management processes. Adding resources with skills in risk management may therefore be valuable.
Do you need to be a qualified procurement practitioner to be a successful member of a procurement team?
I don’t think so. Procurement is not that hard to learn, and there are many different types of roles to choose from. So many different skillsets can be used, such as analytics, relationships skills as well as a legal competence. I think it’s a richness to have other backgrounds joining procurement teams helping them also to see “outside in”.
In your opinion outside of geo-political, pandemics, and natural disasters, what is the biggest challenge procurement faces in the coming years? How can this risk be mitigated?
My top two would be sustainability and security. Both topics relate to building visibility and using influence in an intelligent manner in a growing and increasingly digital supply chain. Both topics, in case of failures, can have an enormous impact on a companies reputation, and future EU regulations such as NIS2 and sustainability related “transparency acts” will force companies to implement robust supplier follow-up processes. Fines are counted in millions of euros and top executives may be personally held responsible. As cybersecurity is a topic of special interest to me which I will talk about at Procurecon Europe, I would like to say a few words about that.
Cybersecurity is often perceived as a topic belonging to the security department. Especially non-technical procurement professionals and other company employees in non-IT roles may sometimes see it as daunting or far from typical procurement competence. However, its not that complicated. Systems are often breached due to physical or logical access. People open physical or virtual doors accidentally and that may result into hackers accessing a whole supply chain via inbuilt trust in IT systems. Phishing and social engineering methods are becoming more sophisticated and “hacking as a service” is more readily available on the Dark Web. It is not IF you are hacked or affected, it is if you know it. As procurement professionals we need to know our supplier base, know where these “doors” or “vulnerabilities” are and have relevant security standards to discuss and demand from our suppliers. We play an important role in protecting our companies from disasters that might cost us much more than just money.
As the new NIS2 legislation on 3rd party cybersecurity steps into force this October, there will be many models and best practices available to use as a base. It is important to stay up to date and discuss with your security department what is reasonable and proportionate for your company. When procurement stands up and owns their share of the company’s cybersecurity burden, supplier cybersecurity takes a big leap forward.