I have had this conversation with each of my executives at least once.
It starts with this question:
“Where do you want your career in procurement to go? Into Category specialization or people management”
Of course, nothing is black and white. But them thinking about the topic and answering gives me the feedback I need. Based on this, to give them the knowledge and experience they need to progress. And very often I promote them and change their roles based on the answer to this question.
Let us dive in, as I would like to explain in more detail what is the background of this question.
Category management route
I have a friend who procures only a couple of items for the Company. Some cans, heat shrink foil and a couple of kinds of PET bottle forms.
For one of the largest soft drinks manufacturers in the world!
And trust me, he earns every cent he makes. He knows all the aluminium mines and all major mills. How the market will move in the next 3 and 6 months. Who and what is influencing the price, and what makes it move? He has his contract with the main and the support supplier. And a couple more manufacturers registered, in case something happens to the main supplier. His job is to monitor stock levels both at his and the supplier’s warehouses. He makes sure seasonal demand changes are covered with sufficient stock.
This guy is on top of the game!
He reports directly to the C-level and is very well paid, yet does not manage one single person.
A second example would be a manager in the head office of a decentralized or centre-led corporation. While he is not involved in day-to-day operations someone in this position has enormous responsibilities. His job is to collect best practices and turn them into procedures that would be applied across the corporation. Secondly, he is there to support the local team when they have large projects.
Once more, no team. All reports are “dotted-line”, indirect. But a very high-level position.
These two examples represent the Specialization career route in Procurement. These professionals reach high positions due to their very specific knowledge about a product/service category, or their procurement knowledge and experience. They do not manage teams and sometimes are not involved in the daily operations at all.
So if you would like to have a brilliant career, but are not very good with people, do not worry. In procurement, we will utilize your strengths without pushing you to fix your weaknesses.
People management route
This route is, however, the more often taken one. The first step is usually to become the Procurement manager, having a buyer or procurement analyst in your team. And then the responsibilities are added based on the nature of your Company. If the purchases are wide, you will soon have a team of 10-15 specialists and support staff, taking care of all purchases. In cases where the purchase is simpler but the Supply Chain is important, you may go into Supply Chain Management. So besides procurement, you will handle the Warehouse and sometimes the logistics as well.
There is a saying that perfectly explains the required knowledge and skills for those roles:
“Jack of all trades, but master of none”
You have to know enough about the goods and services your company is acquiring to participate actively in the final negotiations.
A bit of financial knowledge is required. You will need to understand your finance team when they talk about the cost of capital, different cost classes etc.
You need to understand your end-to-end supply chain to spot and eliminate any risks.
Emotional intelligence is crucial. You will be communicating with many stakeholders with different backgrounds, requirements and goals.
In the end…
As with everything in a career, this is not set in stone. We develop and change. Circumstances change. Sometimes the Company you work for is not able to accommodate your request, even if this would mean they would get a much more productive employee. However, knowing where your strengths are will help you to work with the team in a much more efficient way.
For example, many state that I am not a very good negotiator. The main reason is that I am not extracting the best possible outcome for the company. I look always for a long-term partnership and a win-win outcome. So maybe I did not push for the last 3% of the discount. But I am, due to this, able to get more favourable payment terms, access to the latest products and other benefits that are more long-term. Knowing this, when there is a need for a hard-core “price only” negotiation, I gladly involve my Manager. He is a “stop the negotiations when the other side has a crying face” negotiator. So, as a team, we have the best of both worlds.
Know thyself. It will help you a lot in your career.