The Fatal Flaw in Procurement Organizations
Article by Omid G
Procurement has evolved rapidly.
We’ve embraced process automation, AI, robotics, predictive analytics, and advanced P2P systems. Over the last three decades, we’ve shifted from cost to total cost, from simply expediting purchases to strategic sourcing and commodity management, and from procurement oversight to full supply chain management.
But despite these advances, one critical capability has barely improved at all—and it’s keeping us in the back office, underfunded, and undervalued.
That capability is internal influence and marketing.
Why This Matters More Than You Think
If procurement were great at influencing internally, every organization would have a Chief Procurement Officer reporting to the COO, President, or CEO. But in reality, we often report into Finance, Manufacturing, Legal, or—yes, I’ve seen it—HR.
Meanwhile, HR has mastered internal communication. They consistently tell compelling stories about their value, and they almost always have a direct line to the Top Brass.
So why don’t we?
The Problem: Talking to Ourselves
We tend to communicate in ways that matter to us, not our stakeholders. Our biggest bragging point is often cost savings.
Here’s the issue:
Business units don’t care. Cost savings rarely show up on their scorecards.
Top Brass would care—except they never see the money.
When we say, “We saved $125M last year,” leaders think:
“Great! Where is it? Which budget line? I don’t see it—so it’s not real.”
And they’re right. Unless savings are returned to the top line (not the business unit that will just spend it), the impact disappears. In their eyes, it’s monopoly money.
What We Should Be Talking About
We should be speaking the language of executives: EBIT contribution, ROI on the procurement function, competitive advantage, market access, resilience, quality enablement, and speed to market.
Even better—the business units should be saying it for us. When procurement has to self-promote, it’s a sign our influence strategy is broken.
The Root Cause
Our internal influence fails because we lead with our agenda, not the agenda of the person we’re trying to influence.
The truth is simple:
If there were no business units, there would be no procurement.
We exist to enable their objectives at the lowest total cost—not to push our metrics onto them.
Until our communication and influence strategies reflect that, we’ll keep getting placed in organizational silos far away from where decisions are made.
The Call to Action
We’ve come too far in capabilities and results to let influence and perception lag behind.
If executives truly understood procurement’s value add—and if business units demanded it—we’d be reporting directly to the Top Brass.
It’s time to fix the fatal flaw.
Now go off and do something wonderful.
Be your best.
Omid G
“The Godfather of Negotiation Planning” – Intel Corp