In today’s environment, Procurement is no longer just about cost savings (we all know that, and I don’t want to bother you with more typical and hollow LinkedIn Procurefluencer and S. Sinek statements).
The Importance of Analytics: As a strategic function, it requires a deep understanding of risk, market, and geopolitical factors. Risk analysis helps identify vulnerabilities in supply chains, from financial instability to natural disasters. Market analysis ensures organizations anticipate price fluctuations, emerging trends, and shifts in supply-demand dynamics. Geopolitical analysis adds a critical layer, considering global events such as trade wars, sanctions, or political unrest that can disrupt operations. Plenty of tools, such as PESTEL, STEEPLE, or Porter 5 Forces, make it easy for everyone to improve the quality of every Procurement strategy. Start with it and then grow; no one needs to be a Macroeconomics Professor.
💣Here is the problem:
This is not happening in many organizations. Skills are missing, teams face time and resource constraints, or a lack of understanding about Procurement’s role in the 2020ies. However, Procurement and Supply Chain Teams must grasp how global and local dynamics impact supply chains to make better decisions. Understanding the world ensures:
✅resilience, adaptability, and strategic foresight,
✅enabling organizations to seize opportunities (cost down – hot topic for 2025) and mitigate risks (another hot topic),
✅businesses are better positioned to secure sustainable, competitive advantages in an increasingly volatile landscape
👉Here is an outstanding example of what Procurement Leaders need to know about their sourcing markets:
Last Friday, I found an excellent publication (A Reflection on German Economic Policies) by Bingxin Pang on LinkedIn about the Challenges in the German Economy and Industry Politics, which I am happy to share with my network. It is very eye-opening and, at the same time, reminds Procurement and Supply chain professionals of what we have to observe and analyze daily and what information and data we have to gather, enabling us to make solid strategies and decisions. And what added value we can provide to our stakeholders. But it also reminds us how political decisions and social trends undermine the economy and future readiness of a country formerly known as an economic powerhouse.
„Germany, long known for its industrial prowess and economic stability, is facing significant challenges threatening its position as a leading global economy. Issues such as declining innovation competitiveness, productivity stagnation, and soaring energy costs are increasingly undermining Germany’s economic strength. Understanding the root causes of these problems is essential for charting a path forward.“
👉 Click the link to read the entire article. Time well spent: https://www.linkedin.com/pulse/reflection-german-economic-policies-from-third-party-view-pang-pwbof/
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