What would your operating model look like if you designed it today?
Most procurement operating models were assembled one compromise at a time, when there were never enough people to do anything else. Those limits are going, and for the first time the function has real choices to make.
Four compromises
None of these was a bad decision. Each was a sensible answer to the same limit: there were never enough people.
The transactions went to a shared service centre
Offshoring cut the opex budget, but not the work. Volumes held or grew, and more complex processes and governance added new layers on top.
What's possible now
Routine requests run through routes procurement has designed, so volume no longer needs headcount.
Every purchase took the same route
Categories differ in complexity, risk and value, but there was only capacity for one route. Simple purchases met needless friction, and high-risk, strategic ones got too little rigour.
What's possible now
Requests are routed by category, value and risk, within policy the organisation has approved.
Control meant going through people
If you wanted spend to follow a policy, you sent it through the people who knew the rules. That's why the function centralised.
What's possible now
Control can live in the workflow, so the same rule reaches every request without anyone reading it.
The mandate grew. The team didn't.
Supplier relationship management, third-party risk, then sustainability, each landing on the same people, who covered what they could and let the rest go.
What's possible now
Freed capacity goes to the work only people can do, where procurement can change the outcome.
A procurement function that learns from every purchase
Orchestration, agents and specialist platforms run each purchase within the rules your operating model sets. Every purchase adds to the data. Your team uses that data to change the rules, so control still exists without a person reading every request.
Diagram: orchestration, agents and specialist platforms handle each purchase; the data from every purchase feeds spend intelligence, supplier and contract data and market data, which your team uses to improve the rules.
Intake and orchestration is where this change shows first. See how Procurement Code works on intake and orchestration →
What the new operating model has to decide
What procurement should be will differ by company. These are the decisions every function now has to make for itself, rather than inherit.
What procurement is for
Shaping what the organisation buys, and managing the supply base. Everything else goes through routes procurement has designed.
Which controls run as workflows
Where a rule can run itself, and where a person still needs to judge. An auditor will still want to see how each decision was made.
Where the people go
Some design and run the system. The rest are specialists, put where procurement can change the outcome and kept out where it can't.
How the organisation buys
How procurement orchestrates buying across the company. Category strategies decide where the value is, and buying channels carry them into everyday purchasing, so people buy the right way without procurement in every request.
The operating model was inherited. The next one does not have to be.
Which of these decisions comes first for you?
The diagnostic shows where your operating model stands today, in one session.
The free diagnostic
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