How To Break Down Silos Between Procurement & HR and Drive Workforce Transformation
HR and Procurement each need to build a close working relationship to help break down silos which slow progress. CEOs across all business sectors identify the hiring and development of talent as their major challenge. In a tightening labour market, HR teams are all too aware of their responsibility to help ensure the organisation has access to the skills necessary for achieving successful business outcomes as and when they need them.
Today’s talent enjoys a greater choice than ever before over how and where they work. Many are looking to develop their professional skills and knowledge across a multitude of organisations and sectors, eschewing the traditional linear career path dedicated to serving in one company.
With overall company budgets increasingly under pressure, the procurement team needs to show maximum value from all their relationships and longer-term deals, especially when working with HR.
Emerging technologies alongside changing consumer and employee expectations are rapidly shifting business priorities. This results in procurement professionals knowing the importance of building flexibility into how they structure their deals.
They cannot risk agreeing to longer-term supplier partnerships that aren’t able to cater to the shifting needs around resource capability and commercial priorities. Any financial savings from HR procurement deals need to be weighed against potential costs of not having the most effective solution when it’s needed.
Is Talent Management Creating Silos?
In the area of talent management, yes it is. It is increasingly evolving to respond to different skill needs that may require a mix of permanent and contingent staffing as well as up-skilling. This is where the most urgent case for collaboration and mutual understanding is needed between HR and Procurement.
Both areas of the business, Procurement and HR, need to work towards a common solution for contingent staffing, despite this often being drive by non-compatible goals. Having the right talent available at the right time needs to be balanced with extracting maximum value from commercial relationships.
Can the most flexible and all-encompassing solution for workforce and talent spend management be found at the right price? Often there seems to be a disconnect between Procurement and HR. In discussions I’ve had at ProcureCon HR in previous years, I have heard the former complain that the latter are too focused on the permanent workforce.
There is some truth in this. Many HR professionals have been shifting the dial on performance management and feedback - making both more continuous and constructive - and on overhauling the approach to learning. Procurement meanwhile, have been trying to source cost-effective solutions for a more agile and responsive workforce.
Clearly, Procurement and HR need to break down the silos and work more closely together, enabling the business to better meet its commercial goals.
How can we achieve this? Here are 4 recommendations:
Build the Trust
For an HR procurement strategy to deliver successful outcomes, both HR and Procurement professionals need to fully understand the challenges they’re trying to address. First, they must engage with each other to build trust. This will enable each party to be open and honest about what they need, how much they can deliver and how they can best achieve it.
This means using plain and simple language and investing the time in getting to understand each other’s priorities, expectations and constraints. Ultimately, they need to build this trust and respect between each other, so they can work harmoniously in partnership to deliver valuable business outcomes.
Maintain the Relationship
Procurement and HR teams need to engage with each other in a balanced way, to avoid one side trying to dominate the other. This will enable them to respect and acknowledge each other’s expertise and unique skills in their fields.
In order for collaboration to work effectively, both parties must be prepared to fully understand that the ultimate objective is to meet the business goal, (e.g. secure the right talent and HR services for the company). Once this partnership has been achieved, both teams will be in a much better position to deliver a more valuable solution.
Without this foundation of trust and respect, working together toward that end goal becomes increasingly complex and tedious, which can create detrimental results.
Understand the Internal Stakeholders
Once working in partnership has been achieved for both HR and Procurement, the next step is to build and foster closer relationships with their stakeholders. This is to ensure a better understanding of their unique challenges, targets and desired business outcomes. Especially, when it comes to understanding their stakeholder’s requirements for specific solutions and how they can be easily implemented into the business.
The Procurement manager’s suppliers, who are providing the HR solutions that they will need to implement, also need to understand how best they can provide their full range of solutions to the business. This will ensure that the right talent and HR services are provided for the company when they are needed. One way this can be achieved is by giving stakeholders input into the solution design process.
Think Value and Innovation
One way for the partnership to thrive is to focus less on costs and responsibilities and more on value and innovation. HR procurement savings might be high on the agenda, but cost control alone shouldn’t drive the relationship and shape the outcomes. The value should be the ultimate goal for HR procurement strategy.
Although it’s important for cost efficiencies to be considered, ensuring the quality and capability of staffing support delivered through a responsible partnership of external suppliers, must be the end goal. It goes without saying that the suppliers will need to demonstrate that they can offer creative and innovative solutions that are of value to the business.
ProcureCon HR 2019 is a specific HR procurement conference event that you won’t want to miss out on. Make sure you don’t forget to download the agenda today for ProcureCon HR, one of the best HR procurement events Europe has to offer.
Written by Mervyn Dinnen, a speaker at ProcureCon HR 2019.