Practical Talent Management for Procurement

Michael Lamoureaux over at the Sourcing Innovation blog  is coordinating a cross-blog series on the subject of talent management in purchasing and supply management. So I thought I'd add my two cents on this important topic.

There are many best practices for talent management offered by human resource experts.  What I'd like to focus on is a practical approach to managing procurement talent.

1. Feeder Pool - College Graduates

There are over 100 colleges in the U.S. that now offer purchasing related courses.  Many of these schools also offer a supply management major.  

Why is this a good "feeder pool" of talent?

• Talented graduates are available for hire every year
• These students have a desire for a career in procurement
• Entry level salaries are affordable
• Pro-active recruitment provides the best talent

2. Pair College Grads with Purchasing Managers in Direct Materials

The college grads should initially work with your most senior managers in direct materials.  There are two benefits to this approach.  

• The purchasing managers will now have more time to focus on strategic sourcing activities. 
• The newly minted buyers will have the opportunity to learn the basics of supply management from a seasoned procurement professional.

3. Move Buyers to Indirect Materials

After 2 years the buyers should be rotated to indirect materials.  These buyers will now have the opportunity to stand on their own two feet...  develop and lead strategies, conduct bid events, negotiate contracts etc.  If mistakes are made (or when), the impact to the organization should be less disruptive in this buying environment. 

Managing categories like MRO can be a humbling experience.  Learning to work with key stakeholders in manufacturing will help develop both customer service and change management skills.

After 2 to 3 more years in Indirect Materials there should be an opportunity for promotion with-in the indirect materials group.  Managing a service category would be an ideal experience.

I'll make the point here that outsourcing indirect materials is not a good idea.  It is a great talent pool for your procurement organization.

4. Back to Direct Materials

Now these buyers have 6 to 8 years procurement experience managing multiple buying categories.  It is time to take on a more senior role in direct materials.  This is probably a lateral move from their last position in indirect materials. 

After 2 to 3 more years these buyers are ready to become the purchasing leaders for your organization.  They are the managers training a new group of procurement talent.

Final Thoughts

At some point in the buyer's career, provided they are progressing as planned, the buyer is put on management track.  This is similar to how accounting firms manage talent they would like to keep.  Last, for this approach to be feasible a buying group of 25 is needed.