A few days ago Peter Streefkerk asked me something about the state of mind in purchasing professionals. It got me thinking.
First I had to think about the classical dilemma where staff departments assume authority over the business. I still see that happening a lot. So here it goes.
In today’s competitive market, businesses must adapt to remain successful. One key aspect of this lies in recognizing the importance of placing business at the forefront, rather than focusing solely on staff departments. Here’s why:
1. Revenue Generation: When business leads, the organization can better emphasize revenue-generating activities, which are crucial to long-term sustainability and growth.
2. Prioritization: Business-focused leadership helps prioritize key projects and initiatives, driving organizational alignment and ensuring resources are directed towards high-impact goals.
3. Efficiency: A business-first approach encourages companies to streamline internal processes and eliminate redundancies, boosting overall efficiency and productivity.
4. Innovation: By placing business interests at the forefront, organizations foster an environment conducive to innovation, staying ahead of the competition and cultivating new opportunities.
5. Employee Engagement: A business-first mindset reinforces a shared vision, promoting a sense of ownership and creativity among employees, who feel more connected to the company’s mission and success.
6. Risk appetite: A business-led risk approach forces organizations to accept risk and use it as an opportunity before we legalize or procure it to death. Risk and reward are close allies, but who can value the risk/reward pay out better?
Let us remember that staff departments play a crucial supporting role, but it’s vital to keep business interests at the helm to drive growth, innovation, and long-term success.
This is why I believe that ownership of commercial relations (accountability if you want) always should be with a business executive. In CATS CM® we call that the “contract owner”. The new generation of business leaders I see in several MBA type classes I teach are getting this, lets hope reality doesn’t drown them in the current state of staff department dominance, staff is never accountable, they can be responsible but business is at the end the accountability holder.
Arjen van Berkum
Arjen van Berkum is a columnist, keynote speaker and motivator, with an eye for business ecosystems, innovation and disruption. In addition to his work as technology and contract management evangelist, he is a visiting lecturer at Delft University of Technology (TU Delft).
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