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IS YOUR PROCUREMENT
OPERATING MODEL
FUTURE-FIT?

A robust and fit-for-purpose procurement operating model is crucial to delivering sustained

commercial value for any organisation.

Procurement operating models – the structures, processes, tools, and capabilities for delivering
procurement – often evolve in response to business needs. This evolution is often not strategically
planned and managed, and there may be little consideration given to the procurement building
blocks needed to deliver the organisation’s future requirements.

Where a structured approach for setting and maintaining a procurement operating model is not
followed, some areas gain more focus while other areas are not appropriately addressed. This
leads to solutions that have limited effectiveness and results in loss of significant commercial value
from inefficient operational delivery (refer to the image below detailing the “typically low- and
high-focus areas”).

A future-proof procurement operating model that is not just fit-for-purpose but addresses all key
dimensions can add significantly to the efficiency, quality and value delivered by procurement.
Leading practice organisations that invest in defining, designing and implementing their
procurement operating models typically see improvements in value delivery by up to 50 percent.

Transformational procurement change should look beyond improving

existing transactional processes

Typically low-focus areas Typically high-focus areas

Organisation Strategic
and skills supplier Process
management Tendering compliance

Procurement Business Contracts Transactional

planning engagement oversight technology

Is your procurement operating model future-fit?

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TO UNLOCK THE FULL VALUE OF THE PROCUREMENT FUNCTION,

LEADERS MUST LOOK AT ALL THE BUILDING BLOCKS OF AN
EFFECTIVE PROCUREMENT FUNCTION.

STRATEGY AND VISION

VISION AND
STRATEGY
GOVERNANCE, POLICY, AND SUSTAINABILITY

ORGANISATION STRUCTURE
ORGANISATION AND
SKILLS
PEOPLE AND CAPABILITY DEVELOPMENT

PROCUREMENT SUPPLIER
SOURCING
PLANNING MANAGEMENT
PROCESS
EXCELLENCE
PROCUREMENT PERFORMANCE BUSINESS PARTNERING
MANAGEMENT

DATA AND INSIGHTS

TECHNOLOGY AND
DATA
TOOLS & TECHNOLOGY

Addressing specific elements of the operating model framework only

yields incremental benefits, and the sustainability of these benefits
is questionable.

A transformative approach that addresses all key dimensions is the only

way to increase value delivery substantially and ensure the sustainability
of benefits in the longer term.

Is your procurement operating model future-fit? 2

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KEY CONSIDERATIONS:
FUTURE-FIT PROCUREMENT OPERATING MODEL
The following set of key questions must be considered as a recommended first step for progressing
to an optimal procurement operating model.

Strategy • Is the procurement strategy clearly articulated, aligned to the wider

corporate goals, and cascaded into measurable objectives?
• Is procurement perceived as a strategic and value-adding function by
its stakeholders and customers, both internally and externally?
• Have we defined the scope and responsibilities of procurement in a
way that is aligned with other functions?

• Is the structure set up in the most pragmatic way in terms of size,

Organisation location, skills, and reporting lines?
and People • Do the functional units within procurement reflect the priorities set out in
the procurement strategy?
• Have we future- and growth-proofed our structures and skill sets to
ensure flexibility and scalability for the organisation’s future needs?
• Do we have the clarity of responsibilities, competencies, and career
pathways to aid personnel development and retention?

Core • Are we able to plan ahead, reducing urgency and easing the pressure to
reduce process cycle times?
capabilities
• Do we consistently identify and focus on strategic-level opportunities,
both for sourcing and supplier management?
• Do we have appropriate governance, decision-making accountability,
policies, and procedures?
• Do we consider process efficiency from end to end, including pre-
sourcing (e.g. supplier registration, planning) and post-sourcing (e.g.
contract management, receipt, and payment)?
• How do we engage and partner with our internal stakeholders?

• Are we able to access the right data at the right time to drive
Enablers procurement decisions?
• Do we get the most from our existing technology systems, and do we
have awareness of emerging solutions that could add additional value?
• Are we managing risks in the supply chain, while proactively responding
to regulatory and compliance requirements?
• Is our approach to ESG and Local Content / In-Country Value
appropriately reflected in our procurement operating model?

Is your procurement operating model future-fit? 3

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How Efficio can help

Efficio is an end-to-end procurement and supply chain With the procurement landscape changing as a result of
consultancy organisation with unrivalled expertise in increased expectations, the impact of technology, and new
procurement across all areas of strategy, organisation, ways of working – it is no longer a question of “if” but
and delivery. We work with clients to co-create future-fit “when” organisations look to review and future-proof their
procurement operating models that drive real and procurement operating models. The sooner procurement
measurable value delivery through: leaders pick this up, the faster will they be able to leverage
and maximise procurement-led value delivery for their
• Clear strategy and direction for procurement execution
organisations’ advantage.
• Fit-for-purpose procurement governance, policy, and
As well as optimising established procurement operating
processes
models, we are experienced in greenfield setup of new
• A right-sized, motivated, and skilled workforce procurement functions.
• Maximising value (financial, efficiency, Local Content Need help with reviewing your procurement operating
and ESG) with a partnership approach, strategic model? Or want to enhance value with a future-fit model?
supplier management, and effective compliance and Contact Edmund Tapfield at [Link]@
control [Link]
• Long-term planning and delivery management through
availability of appropriate systems

Offices
Abu Dhabi • Chicago • Copenhagen • Dubai • Dusseldorf • Geneva •
Lisbon • London (Headquarters) • Milan • New York • Paris • Riyadh •
Stockholm • Toronto