Two sides to a storyThere are 2 ways in which organisations have to look at the relation between procurement and IT.
- The CPO needs to seek advice from and align with the CIO in order to create greater business efficiencies and drive their digital transformation initiatives forward. No matter how much experience they carry with them, procurement will now have the same technical knowledge as IT.
- The CIO should seek advice from the CPO regarding the direction in which the IT organisation is heading. Procurement can be an important asset when it comes to acquisitions in the IT area.
How can the relationship be improved?There are 2 important aspects organisations need to consider in order to build a strategic relationship between these 2 departments.
- Make both departments, procurement and IT, “equal” in terms of decision-making power.
- Have a clear definition of the roles for both the CPO and CIO
RecommendationsWe believe, it all comes down to an organisation’s business strategy. The business strategy can, and should, establish a few objectives to help build a more collaborative relationship between the CPO and the CIO:
- Roles : as we mentioned above, both the CPO and the CIO should have clearly defined roles within the organisation which should integrate into the strategic planning process.
- Strategic planning : organisations should create an environment that ensures strategic planning and organisational procedures become established practices
- Authority : increasing the role both procurement and IT hold within the organisation’s decision-making process should enable a deeper thought process for both and encourage them to make an effort collaborating with each other