Part 2: In Conversation with Sebastian Chua on Innovation in Procurement
In Part 2 of our chat with Sebastian Chua, we touch on the subject of Innovation- one of the hottest topics in procurement in recent years.
Over the decades, procurement’s role has evolved to be strategic and dynamic. Traditional procurement emphasised a lot on processes, rules and delivering savings, which made the relationships with business stakeholders very transactional and reactive, more so compliance focused. At worst case, procurement had commonly been perceived to be uncreative.
In recent years, procurement has faced a radical change with expectations to deliver greater value by not only contributing to profit maximisation and business growth but playing a part in strategy. For the modern procurement function to thrive in today’s time, procurement teams have to adopt innovative strategies that would enable the business to remain competitive and stay relevant to the business’s needs. At best, they can infuse new life to their supply chain.
According to Sebastian; "Shaping the culture of innovation has to start from us and as procurement leaders; we have to drive this behavioural change. The first step would be to dispel the myths that shroud the truth about innovation. As procurement leaders, we are responsible to create the space to allow innovation to happen. To begin with, let us correct the three myths of innovation.
1) “We cannot rock the boat”
When trying to drive innovation, many assume that the key factor is the adoption of the right tools and technology. However, the true key to innovation lies in our ability to change our attitudes and mindsets, but there is a challenge to this. It is in our nature to prefer the status quo to uncertainty as many of us tend to be risk-averse, and this is associated with the fear of failing when we try new things. While these may be valid concerns, we need to look beyond the uncertainties by trying fresh ideas and adapting to new realities.
2) “We cannot fail”
The decision to innovate comes with its associated risks and we cannot be oblivious to the fact that there is potential to fail. Knowing this, we must still have the tenacity to keep trying and accept that, sometimes, failure is inevitable when we attempt something new. It can also be argued that, in some instances, failure can serve as a stepping-stone to success. In essence, failure is important for leading organizational learning towards success because it creates opportunities for improvement, encourages problem solving to bridge knowledge gaps, makes us courageous to accept change and adopt innovation.
3) “We are too junior to make a difference”
In today’s overly complex, ever-changing world, every employee at every level needs to be thinking strategically, looking for new opportunities - for the business, as well as for their own career growth. We should empower our staff to challenge these myths and grow to be better procurement people. The ideologies that should be adopted would be:
• “We can rock the boat when it is the right thing to do.”
• “It is not about failure, but learning and adapting.”
• “Everyone and anyone can make a difference.”
Only by breaking through these mental blocks that we have created for ourselves, can we even begin to think about innovating."
These pearls of wisdom from Sebastian are much needed when it comes to taking a step into innovation throught a positive attitude and mindset. From what we have gathered all along, procurement can drive improvements in the business and its developments. In a highly volatile world, with economic, ecological and environmental pressures, the procurement function sets out to achieve effective processes to combat such issues- so there is definitely no lack in innovative possibilities.
Ultimately, procurement is at the heart of the business and its needs. Rather than being a boring cost-savings ambassador, act as an enablers through innovation. Instead of focusing on the negatives and fear, step up and unleash a true transformational way in which procurement can deliver results.