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- September 26, 2016
- Chris Sawchuk
Talent management remains one of the top 3 major area of focus for virtually all procurement organizations, at least according to The Hackett Group's Procurement Key Issues Study
Organizations are targeting three specific areas for development: improving leadership skills, honing business acumen, and building specialist procurement skills. The two perennial favorites, category management and strategic sourcing, make up the other top reported objectives.
Most procurement organizations (especially those in Europe) continue to experience higher levels of staff churn and difficulty attracting great talent. The research also showed that managing millennials represents one of the greatest potential impacts and challenges to managing talent in the next year or two.
What do we mean by Millennials?
When we refer to the millennials, we are referring to those born in the ‘80s and now moving into management positions, or those born in the early ‘90s who are now joining the workforce. Millennials are characterized by different attitudes, desires and motivations than earlier generations.
Generations X and Y came to be known for their independence, interest in work/life balance, technical proficiency, and measuring success in both financial and social terms. Millennials, on the other hand, are the first generation of digital natives – i.e. they’ve truly grown up with the internet and social consciousness. They have high career expectations, desiring both immediate and high impact opportunities. They want flexibility in terms of schedules, embracing remote working, and diversity in their assignments (e.g. culture, fun and collaboration).
They plan for rapid advancement as well as frequent job changes. Case in point: 90 percent of millennials plan to stay in their job for less than 3 years. They are high touch, and expect frequent feedback. In summary, the millennial generation wants more from work than just a career at a good company.
How do we respond?
As procurement leaders, this situation poses challenging questions:
- What procurement value proposition will be the most appealing?
- Will higher attrition become the new normal for procurement?
- Is now the time to invest in knowledge capture and transfer?
- How can we create flexible work schedules and collaborative environments?
- Do we need to rethink the importance and type of training we provide?
How can procurement address the critical skills gaps?
Past research conducted by the Hackett Group on procurement talent management has shown clear gaps in the essential business skills required for most procurement jobs. These are: strategic thinking and analysis, group facilitation, and relationship management skills.
When considering specialist skills, enhanced supplier relationship management (SRM) and market intelligence expertise were in need of development for most roles, with supply risk, innovation and supply chain management expertise needed for specialist roles.
In all cases, training strategies need to be modernized to reflect changing learning styles and preferences. Strategies that get people up to speed faster, use more interactive, workshop and team-based formats should be preferred. The 70-20-10 approach to learning is based around the idea that 70 percent of learning comes through experience, 20 percent from social learning with colleagues, and just 10 percent through formal learning involving training or online courses.
This framework will see larger elements of learning being on-the-job, collaborative and workshop based, and complemented with self-directed learning elements and social learning (e.g. LinkedIn, Yammer).
Course materials need to be user friendly, but at the same time to support multi-tasking and access to on-demand, on-line tutorial content. Course design should incorporate the themes seen as important to younger generations – how procurement connects into corporate social responsibility and sustainability, work/life balance, and career advancement.
Older generations may need support and even training to adapt to this shift in to mentality and culture.
About Hackett’s Procurement Key Issues Study
The results of this annual study are gathered from executives from over 180 large and global companies operating in the US, Europe and rest of the world, with annual revenue of $1 billion or greater. Find out more by visiting the Hackett website.
Chris Sawchuk is principal and global procurement advisory practice leader at The Hackett Group. A version of this article previously appeared on Procurious.