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TL;DR: Global Chief Procurement Officer Survey

Overview

  • The 2023 Global CPO Survey by Deloitte, based on nearly 350 responses from senior procurement leaders across 40+ countries, highlights how top-performing procurement teams, referred to as "Orchestrators of Value," are navigating increasing pressures and complexities in procurement.
  • Key focus areas include operating model design, talent strategy, and digital maturity, with top CPOs leveraging these to deliver enhanced value despite challenges like inflation, supply chain disruptions, and talent shortages.

Key Findings

  1. Procurement's Evolving Role:
    • Procurement now plays a critical role in addressing broader business priorities, including ESG (Environmental, Social, and Governance), digital transformation, and supply chain resiliency.
  2. Cost Savings and Operational Efficiency:
    • Despite cost savings being a core expectation, only 69% of procurement teams met or exceeded their cost-reduction targets, down from 84% in the previous survey.
    • Top-performing procurement teams focus on increasing supplier collaboration, investing in digital transformation, and enhancing demand management.
  3. Talent Management:
    • Talent acquisition and retention are top internal challenges, with over 70% of CPOs facing difficulties in attracting talent.
    • "Orchestrators of Value" employ broader talent strategies, including hybrid models and advanced talent development programs, to maintain a competitive edge.
  4. Digital Maturity:
    • Digital transformation is a key strategy, with advanced analytics and robotic process automation (RPA) being the most impactful technologies. However, barriers like budget constraints and data quality issues persist.
  5. Risk and ESG:
    • Procurement-related risks, particularly inflation and supply shortages, remain high, with a significant focus on enhancing supplier performance management and supply market intelligence.
    • ESG is increasingly prioritized, with 85% of firms actively collaborating with suppliers on ESG initiatives.

Key Statistics

  • Performance Gap: Top-quartile CPOs (Orchestrators of Value) have a 25% performance advantage over their peers.
  • Cost Reduction: Only 30% of procurement teams met their cost-reduction targets, down from 50%.
  • Talent Gap: 90% of top-performing CPOs believe their teams have the necessary skills, compared to less than half of their peers.
  • Digital Investment: Technology funding as a percentage of the total procurement budget dropped from 13.2% in 2021 to 10.9% in 2023.
  • ESG Focus: 62% of CPOs target climate mitigation, and 72% focus on waste reduction and material circularity.

This survey provides a comprehensive view of the challenges and strategies shaping modern procurement, with an emphasis on the importance of orchestrating value through effective leadership, digital transformation, and strategic collaboration.