Best in Class CPOs Are Clear: Manage People First and Spend Second

The priorities of best-in-class CPOs (Continuous Programme Optimisation) are clear: manage people first and manage spend second. Priorities for their lower performing peers are completely reversed.

Aberdeen Group's new study, "The CPO's Strategic Agenda: Managing People, Managing Spend" discovered that more than half of best-in-class CPOs consider managing their procurement teams to be their top priority in the year ahead.

Improving supplier relationships ranked second in importance with increasing spend under management placing third. To achieve these goals, best-in-class CPOs recognize that they must work diligently to manage and enhance their internal and external relationships and that clear visibility into procurement activity and the underlying data serves as the cornerstone to their success.

The role of procurement continues to increase in strategic importance within the enterprise as a greater awareness of the bottom-line value that the function can deliver becomes more evident. The report also shows that 2007 will be another active year for the CPO as:

- 72% of CPOs will prioritize their spend visibility initiatives as the primary way to increase spend under management.

- 62% of CPOs will seek to improve supplier scorecarding and performance measurement capabilities.

- 76% of CPOs will initiate or continue process improvement and/or process standardization programs (e.g., Six Sigma).