Deloitte: global uncertainty triggers cost cutting and risk management by CPOs
Results of the Deloitte Global Chief Procurement Officer Survey 2017 point to reducing costs in the face of global uncertainty as the biggest priority Chief Procurement Officers (CPOs) face. Eighty-four percent of the CPOs surveyed in North America said that managing risks is the second highest priority, indicating that they are taking a cautious approach at a time when risks include weakness and volatility in emerging markets and rising geopolitical risk; the possibility of renewed European crises; spillover effects of any market slowing in China; uncertainty over Brexit; and outcomes from upcoming trade negotiations.
61 percent of the respondents said that despite the uncertainty, savings performance improved compared to the previous year, and there was improvement in the level of support from executives.
The CPOs also pointed to talent as driving procurement performance, but there is still a large to moderate skills gap across analytical abilities. More than 60 percent of CPOs surveyed believe their teams lack the skills needed to deliver procurement strategies.
Digital innovation is another factor that requires the traditional procurement model to change. Analytics will have the most impact over the next two years, according to respondents, as well as automation and robotics, which will increase over 30 percent over the next five years.