Chief Procurement Officers (CPOs) and other procurement leaders may be the new drivers of not only sustainable but technological reform within their organisations, says a new report conducted by Icertis.
The report surveyed supply chain, procurement, and risk management leaders from companies across the U.S. and Canada. Respondents came from sectors spanning manufacturing, pharmaceutical, aerospace, automotive, and more. The report “uncovers the transformation of Chief Procurement Officers (CPOs) into key influencers shaping company strategies and the role of AI in navigating challenges and opportunities related to procurement processes, technology implementations, and sustainability initiatives.”
The report’s findings included the fact that procurement teams are increasingly a significant driver of strategic value within businesses. A marked 46% more CPOs were found to be wielding influence in high-level decision-making compared to two years ago.
CPOs in the driver’s seat
This finding goes hand in hand with the revelation that CPOs are becoming technology adoption leaders within their organisations. The report found this was particularly true in relation to artificial intelligence (AI). Reportedly, 44% of CPOs have been responsible for leading AI adoption efforts in their organisation over the past year. Whether leading AI adoption or not, CPOs widely recognise the importance of AI as a supporter of procurement transformation.
Another area where CPOs are driving adoption is in the are of sustainability initiatives. Icertis’ report found that 86% of CPOs play “a moderate to large role” in driving sustainability in their organisation. Additionally, 46% of procurement leaders confirmed that they would be prioritising ESG and sustainability goals in 2024. However, accurately assessing and extracting ESG data from the supply chain is an ongoing, thorny, process for supply chain and procurement leaders. Just under half (43%) of CPOs surveyed confirmed that they would be enhancing capabilities to extract and interpret ESG metrics from data going forward.
“Especially in times of volatility and change, the organisational significance of the procurement department continues to grow, spanning contract creation and approvals to surfacing untapped savings, avoiding missed obligations, and ensuring ongoing compliance throughout supplier relationships,” said Bernadette Bulacan, Chief Evangelist, Icertis. “As the global regulatory landscape undergoes dynamic changes and businesses grapple with challenges like supply chain disruptions, inflation, ESG audits, and market volatility, the expectations of CPOs have never been higher.” She adds that 2024 represents a pivtal moment for the sector. She adds that CPOs will need to “assert their influence,” in order to steer their organiations. Those who succeed will have a defining role in “shaping business-critical initiatives with AI technology, particularly in contract management.”
