'Shareholder Spring' presents silver lining for procurement
May 8, 2012 4:43:00 PM
The opportunity to deliver enhanced shareholder value remains, even amid darker storm clouds.
Since I last wrote, the atmosphere sitting here in the City of London has taken a notable turn. The reality is that the problems in the Eurozone, which appeared to take a break in early Spring, have returned, compounded by faltering growth, the return to recession in the UK, disappointing jobs data and changing governments in several European jurisdictions.
However, though this seems very bleak, there remains an opportunity for companies to think differently about how they protect the interests of their shareholders, investors and other stakeholders. With shareholders seemingly becoming more vocal (the so called 'Shareholder Spring') about how company leaders manage their businesses, it is even more important for businesses to demonstrate the steps that they are taking to preserve and nurture their investors' long term interests.
This has become increasingly clear to us this month, while we have been running some new research (contact us here if you would like a copy of the findings). The first piece of the research is around the scale of the opportunity that exists in cost management, as well as how closely reality matches aspiration. And we have also been assessing potential benefits that can be brought about by outsourcing indirect procurement.
One stand-out statistic is that the activity that is outsourced least, business engagement and change management, was rated by 98% of CFOs involved in the study as the most important capability of the indirect procurement function and one with which more than 60% of CFOs expressed dissatisfaction with where they are today.
These extraordinary percentages demonstrate a significant opportunity for business leaders and shareholders alike. However, this does require some different thinking, as our post on the instilling of intelligence into the budgeting process outlines.
Rather than being dispodent, let's seek opportunities in these challenges and view the coming months, difficult though they promise to be, with a degree of relish. Identifying new means of protecting profitability in difficult times means that we can make a real difference to the businesses we work with. And with some interesting new opportunities coming through in the coming months, we will look forward to sharing those with you soon.
Spring has certainly sprung, but perhaps not in the traditional way this year, on a number of levels.
If you have any thoughts or comments you would like to add, please add them below.
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