Over the last six months, we have been interviewing executive procurement professionals, discussing talent management and the perceived talent shortage within the function. The discussions have centred around what the industry, businesses, or individuals are doing differently to address and tackle this. In the third instalment, Tom looks at what can be done differently to develop the skills of those that are currently in the function.
I’m regularly told that technical skills can be taught, but it’s the soft skills that make an outstanding procurement professional. With learning agility and growth potential seemingly being more desirable than technical expertise, I have looked into what some organisations are doing to develop their top talent.
I was aware of an exchange programme involving HSBC, IKEA and Maersk aimed at developing the skills of top talents from each business. I contacted Jan Fokke Van Den Bosch, CPO of HSBC and Henrik Larsen, Head of Global Sourcing and Indirect Procurement from A.P. Moller-Maersk, to discuss the programme’s creation, evolution, successes and future.
The programme was created with the hope of supporting high-potential procurement professionals by developing their skills in an accelerated fashion. The conception and success of the programme was driven by each CPO. Each business identified two ‘students’ from their organisations to send on six-month rotations to the other businesses. Henrik explains, “It was imperative to find organisations that each CPO could trust. There were no formal HR processes when this started. The rules were clear. No one could hire a student from our partner organisations and each CPO must have the backing from their business to be able to drive this through, ensuring that each student was placed in a business-critical role in their exchange company, maximising their learning and development.”
Jan added, “It is also important to work with organisations where there should not be any competitor clash. We have chosen companies that might not be like us, but with procurement, we are all the same. We can learn from other companies as an external benchmark.”
Creating the 360-degree procurement professional
Each organisation had to analyse areas within procurement where they were strong, but also where their function could improve. “Our organisation needed to identify areas that they were strong in, but also be honest with areas that they were not, or where they had ‘white spots’,” Henrik explained. “We had to find compatible companies to be our capability building partners, where an exchange student could benefit from a six-month rotation in a new environment and in a high-profile role. We recognised we could be better at indirect category management and supplier relationship management and looked to partner with global organisations that had a reputation of building strong relationships that had been developed over time. We also looked for organisations that had a unique approach or model to SRM. What we felt we could offer the market was insight into digital and e-sourcing. We partnered with organisations who wanted to improve in this space.”
Once the skills gap was decided and partnerships had been agreed, each organisation needed to agree on the criteria of each student and how they would be introduced to each organisation, as Henrik explains: “The criteria was stringent; there were a maximum of two students from each organisation. Each organisation was asked to identify strong talent with good experience, to attend a six-month rotation programme with their capability-building partners. Each student needed to have demonstrated adaptability or strong learning agility and growth potential. It was designed to target professionals who were about to ‘take the next step’, typically moving into positions two down from the CPO.” Jan continued, “We give everyone an opportunity to apply. They have to write a narrative based on their motivations and have an internal interview.”
Being in a new role in a new environment isn’t easy, but with the right support the students have excelled. “We ensure we find the right mentor and environment for the student to work. It’s a huge investment from all the companies, both in time and financially, so it’s essential that we put them in the right environment” explains Jan. “Smart people invest in themselves. If they are high on energy, they familiarise themselves easily and quickly with new topics.” Henrik agrees: “Each student already had a deep thirst for learning so was motivated to develop their skills.”
The programme has now run for several years, so what has been the benefit to both the students and the businesses? “If you put talent out of their comfort zones but trust them to develop new skills that will make them successful, it’s a benefit for everyone. We’re not just looking for a benefit for the business – we want a benefit for the students,” confirms Jan. “The organisations aren’t that different in terms of the procurement functions’ skills or capabilities. The technical experience is not the only benefit we have. The cultural and life experience the students can have is unbelievable. We’ve had a student from IKEA in Sweden spend time in India. The different cultural perspective they would gain from that is far superior than any technical expertise. It will allow them to understand the cultural complexities of working within a global business.” Henrik agreed, “The rest of the function are motivated by the new ideas the students come back with. There are no frictions; they understand the benefit of new ideas.”
Jan continued, “Every six months we have a new student from Maersk and IKEA at once. That’s a pair of fresh ideas, who will challenge and provide insight that we previously didn’t have. Our senior stakeholders think it is great; it is something that is recognised in other specialist commercial fields. They recognise that we are creating real life-changing experiences from the programme and there is credit from thinking outside the box.”
Henrik agreed, ‘‘We’ve had nothing but positive feedback. We see a definite evolution and development with each student. We ensure that they write papers and reflect on what has been good and what has been bad with the experience.”
Evolution of the programme
With the exchange programme established, I asked Henrik and Jan how the programme would evolve over time, how each business’s ‘white spots’ would change, and how they ensured that what they were learning remained relevant.
Henrik explained, “It’s something we constantly check. We want to keep it relevant; what is the benefit and how do we keep it relevant? The programme has changed over time, whether it is based on what skills we wish to improve or through creating a more diverse programme. When we started the programme, the students came from our head offices and were typically nationals of each headquarters’ country. This has now changed. We have students from Indonesia, China and so on. The programme is now not only looking to develop someone’s technical skills, but also look at broadening their cultural adaptability. We recognise that being a 360° professional in an international business now means you must be able to adapt to different cultures ways of working. This can create the best learning environment for the students. We are also looking at new topics. Sustainability is something that is becoming more important and higher on the agenda.”
Jan agreed, “We do not always have to look at sourcing. We recently had a student from IKEA join who was an expert in sustainability. What we learnt from her on that topic, she learnt as to how to apply the principles to indirect categories.”
Following each student’s new experience, I asked how they adapted back into their ‘parent companies’ and what the impact had been on retaining talent.
Jan joked, “I work for a bank, where procurement can have a heavy focus around risk and because of that we have lots of processes to add to. There are no perfect systems, so the only way I can ensure our net promoter score is high is for the firm to forgive us by hiring good people.”
Henrik added, “Since we have started the programme, we have only had one student tell us that they do not want to go back to their parent company and requested we hired them. This is not something we would consider and would destroy the trust code we have with our partners.”
And what about the students who wanted to continue working on big projects, who struggled to adapt back into ‘business as usual’ activities and wanted to continue working on new, highly complex, business-critical roles?
“If they leave the firm then we have done a good job. If you have talent and can help make a career for someone elsewhere, you will have friends forever. People will then know you in the market and you will have people turning up at your door,” adds Jan. “There are risks in anything that you do. Sometimes you feed others with talent for them to leave. But equally I now have people who attended the programme on my management team. For me, the experience can be related to travelling the world after you study. At some point, you need to go back to the real world and whilst, in the short-term, the life changing experiences may make it difficult to adapt, you should take the best from this learning into the future.”
Having met some students who have completed the exchange programme, there is no doubt that they are bright, highly talented individuals whose experiences have given them a more well-rounded view of procurement’s value to a business, whether that be in a bank or in a manufacturing or logistics and energy company. Trusting individuals to develop their skills in a new field is something that I personally feel other organisations could learn from. In the short-term you may lose some deep category expertise, but in my opinion, over time the wider commercial perspective, commercial understanding and diversity of thought far outweigh the negatives.
At Berwick Partners we specialise in recruiting Procurement and Supply Chain leadership roles across all sectors.