Strategies for Re-Educating Yourself for the New Millennium

Author(s):

Brian G. Long, Ph.D., C.P.M.
Brian G. Long, Ph.D., C.P.M., President, Marketing & Management Inst., Kalamazoo, MI 49024, 616/323-1531, www.mmii.org.

83rd Annual International Conference Proceedings - 1998 

Abstract. To at least one observer, keeping up with all the changes in the purchasing profession is a little like jumping on a rocket with handle bars. However, it has only just begun. More changes will take place in purchasing in the next ten years than in the previous fifty. How does a purchaser balance a heavy workload with the need to reeducate oneself for the future? This presentation will review the skills necessary for future success, educational resources, and demonstrate how to build a personal reeducation program.

The Opportunity. With or without company support, keeping up to date has increasingly become the modern purchaser's personal responsibility. Unfortunately, many purchasers will find themselves outmoded and unemployable if they do not embark upon a reeducation program of their own. This presentation will first review the skills that will be necessary in the future, and then review the self-education resources currently available, discuss self-education goal setting, and outline successful self-education programs that other successful purchasers have used. Also included will be a description of the future skills that will be necessary for various levels of purchasing based on industry groupings as well as the current age, rank, and status of the purchaser. Finally, for education advocates within the organization structure, proposals will be made for designing and revising new programs to meet the future challenges of the profession. Most of these proposals will be based on resources currently available, although some will require new programs and resources.

The Supply Management Revolution. Purchasing as a profession has redefined itself many times since the first "purchasing agents" appeared in the 1880s. History will record that the late 1990s was the beginning of yet another revolution. Indeed, some say that the industrial revolution is over, and that the information technology revolution is just beginning. If this is true, then what is the role of purchasing in a post-industrial revolution world?

Unlike other changes, the supply management revolution will be more difficult for several reasons. First, there must come a significant upgrading of skills. Most of the previous changes in the profession were organizational. They included changing the titles and responsibilities of purchasing agents to purchasing managers, reorganizing to materials management, implementing team purchasing, and other ideas. Although these changes required moving desks and people, as well as shifting attitudes, few new skills were actually needed.

The second change is speed. Previous changes to purchasing took place over a period of years or even decades. Those professional purchasers who chose not to change could generally find another firm looking for an outdated or old school person. Even today, there are a handful of firms that refuse to computerize and are still typing and filing purchase orders in a manner similar to the mode of the 1920s.

Unfortunately, the current revolution is coming too fast for some purchasers to change. They will find themselves "downsized," "outsourced," or "phased out" before they can retool. The current revolution will require that the purchaser already be retooled before the firm decides to change.

Areas for Reeducation. It is easy to say, "do it better." It is far more difficult to identify the specific skills that need to be polished, or in many instances, developed from scratch. Some of the "must know" skills will first include the internet. Purchasers who cannot or will not use the internet for everything from sourcing to communication will probably find themselves out of a job in the next three to five years.

A second skill relates to cost accounting. Purchasers in the past have simply assumed that the seller's price is always too high and that a primary duty of a good purchaser is to beat a lower price-the lower the better-out of the seller. The only presumed measure of whether the resulting prices was good or bad was based on (1) the apparent profitability of the selling firm, (2) comparison with other sellers in the market, and (3) some measure of how easily the resulting reduction was obtained.

A third set of skills relates to computers in general. Although almost every purchaser admits that the computer is here to stay, few are really ahead of the learning curve. Instead of taking the lead to computerize their departments years ago, most purchasing manager waited for a software package to be thrust upon them. Hence, most so-called purchasing computer modules for the large, integrated programs are really set up to make it easy to pay invoices rather than track and analyze purchases. Purchasing cannot afford to let this happen again.

Most purchasing of the future will automatically assume a knowledge of spread sheet programs, word processing, windows programs, and the like. Beyond these basics, purchasers of the future will find it necessary to participate in the development of new computer systems to provide the necessary supply management information for the future.

Seminar and Conferences. Perhaps one of the most misused and yet underutilized resources for reeducation of purchasing professionals are the numerous conferences and seminars made available for purchasers. Indeed, many firms misused seminars as a "reward for doing a good job" or a "fringe benefit" rather than an educational experience designed to enhance the performance of the person.

Managing the purchase of seminars is not really all that different from any other type of purchasing activity. First, distance is always a factor, both in terms of time and expense. Although some people feel that they have not attended a real seminar if it is less than fifty mile from home, there are still many good opportunities available from local purchasing associations as well as other local institutions.

Next, it is essential to analyze the seminar sponsor as well as the reputation of the speaker. It seems strange that a professional purchaser who would not think of making a purchase from an unknown supplier would blindly send money to a seminar firm that is a complete unknown. In general, seminars that do not specify a speaker will feature a professional non-purchasing presenter who will present materials from an instructor's manual and liven the presentation with timely jokes.

Third, the seminar should focus on specific skills and objectives that can be utilized by the attendee as well as the rest of the purchasing office. One technique for sharing experiences is to require a short presentation at a department meeting of some of the information gleaned from the program.

Finally, conferences require a little different kind of analysis. Most conferences feature an ensemble of speakers and topics, some of which will apply to the attendee's job. Again, is essential to check the reputation of the conference and analyze the quality of the speakers. Beware of "hit and run" conferences. These programs are characterized by clever brochures that make both the speakers and the seminar look bigger than life. For some, the primary goal of these programs is to sell you additional books, tapes, and other materials.

Formal Educational Programs. Choosing a college or university program for the investment of time and money toward the goal of developing or enhancing a purchasing career requires a significant amount of thought and analysis. First, there are only a few programs such as those at Arizona State and Michigan State that enjoy a nationwide reputation. The obvious advantage to programs of this nature is portability. These large programs turn out hundreds of graduates per year, and are recognized all over the world. Over the years, many of their graduates have moved into higher level positions which include the authority to hire new people. Naturally, they have a preference in favor of their own home programs.

In the last ten years, numerous regional programs have been started at other institutions such as the University of Houston, U.C.L.A., and Western Michigan University, just to name a few. These program, although smaller in size, are often of equal quality to those of larger institutions. However, they are less likely to be known outside of the region.

Finally, there are local programs developed by one or two faculty members at a given educational institution that can easily be described as hit-or-miss. These programs usually have no significant funding beyond the department where they are housed, and are usually staffed with faculty that may or may not know anything about purchasing. All the same, some of these programs are very good if they are staffed by true purchasing advocates as well as former purchasing executives who have taken early retirement to devote themselves to education. However, at least some local programs are staffed by unqualified faculty that can do little more than read a purchasing text to a class.

Daily Updating. Altogether too often, purchasers have relied upon salespeople to keep themselves up to date regarding changes in the market. Everyone knows that they should be reading "Purchasing Today" and "Purchasing" magazine faithfully with the publication of each new issue. But these are the very things that seem to get a lower priority in a busy office setting. Also, the person who does take time during the day to glance at a professional magazine is often looked down upon by superiors and peers alike as apparently not having enough work to do.

For these reasons, it may be wise to have all professional publications sent to a home address. Not only will the reading climate be more conducive, but it will also be easier to select and pack certain periodicals for reading on business trips. Furthermore, at least some purchasing professional who have a long term commitment to the profession have decided do develop their own purchasing library.

A second major source of daily updates comes from the internet. The internet may be the future of purchasing, but it is also the future of information. Although far from being fully developed, the internet already has many home pages that provide daily infor-mation on a wide range of commodities. In as little as five years, there will be home pages containing current market information on almost every conceivable commodity from electric motors to corrugated packaging to titanium dioxide. A few clicks at the beginning of each business day will update the astute purchasers who have taken the time to locate these information sources.

Team Skills. Despite a placid emphasis on team building by many firms, the fact remains that almost everyone in today's American corporate environment comes up short when it comes to real team decision making, team building, and team effectiveness. The naive assumption that six people confined to a conference room and given some kind of a team title should instantly become a team is altogether too prevalent. This is often true in spite of so-called team building meetings and team-building education.

The problem often lies at the root of performance evaluation systems. Almost every member of the team is evaluated not on the quality of their team performance but on their own individual performance. Hence, the team becomes a loose coalition that never accomplishes any significant synergy.

One of the most difficult tasks that purchasers of the future will therefore face is to take the lead to develop the purchasing teams that are necessary to accomplish all of the future goals of purchasing. This will require coaching and cheerleading skills as well as the development of relationships with departments and people within these departments.

Concluding Notes.

  • Quit waiting for "the company" to retrain you. It is your career.
  • Don't think that your experience will stand alone. Remember: Past experience may be of little value when future skills are required.
  • Think in terms of minutes per day for self-education. An hour per day for the next five years would make you one of the leading experts.
  • Space it out. Trying to do it all at once seldom works. Try setting annual or quarterly targets.
  • Strive for diversity. Spending too much time on just one educational aspect, such as computers, will obviously leave you short in other areas.
  • Spend at least some time on things you don't like but are still important. For many people, cost accounting skills may be a good example.
  • Start Today. Tomorrow may be too late.

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