812: Procurement's Path Through an Era of Polycrisis W/ Baber Farooq

“During COVID, we went from just in time to just in case. Unfortunately, now supply chains have to factor in risk mitigation. Finding alternative sources of supply might be a little more pricey, but it reduces the risk.” - Alan Arcand, Chief Economist at Canadian Manufacturers & Exporters Economic uncertainty and tariff volatility continue to shape procurement strategies and supply chain decisions across North America. As businesses grapple with unpredictable policy shifts, the need to interpret nuanced economic signals accurately has become critical to maintaining stable operations and safeguarding organizational profitability. To decode these trends and recommend timely strategies, Philip Ideson spoke with Alan Arcand, Chief Economist at Canadian Manufacturers and Exporters, at the Supply Chain Canada National Conference.  In this conversation, Alan highlights key factors procurement leaders should monitor, including the inflation implications of tariff decisions, investment behaviors influenced by economic uncertainty, and the profound impact all of this has on manufacturing sectors, particularly automotive. Alan also discusses: How to navigate conflicting economic indicators in the U.S. to improve procurement foresight Understanding tariff-driven supply chain disruptions in manufacturing sectors, particularly related to steel and aluminum Ways to adapt procurement strategies to shifting North American economic and political fluctuations Utilizing strategic diversification, including nearshoring and friendshoring, to mitigate risk Links: Alan Arcand on LinkedIn Subscribe to This Week in Procurement Subscribe to Art of Procurement on YouTube

Procurement 6 is a short podcast from Art of Procurement that publishes in the Art of Procurement feed every Friday morning at 6am US Eastern Time. Presented by a member of the Art of Procurement team, each episode has 6 short segments that summarize the week in procurement. Segments range from procurement tips to podcast summaries, from details of events to news or overviews of blog posts that capture our attention.

Halfway through their 24-episode journey, the co-hosts of “Buy: The Way...To Purposeful Procurement” pause to assess what they've learned so far about how procurement has and is evolving, and, more importantly, what’s ahead for the future. In this reflective episode, Philip Ideson, Rich Ham, and Kelly Barner bring together insights from their recent conversations that confirm a troubling trend in procurement: not only are the P&L-related harms of procurement's flawed incentive structures real, they're also worsening over time. It is time for procurement to course correct.  Rich explains why by pointing out an important lesson learned from previous episodes: suppliers have figured out the game. They've learned that winning the initial deal is what matters, because procurement's incentives usually revolve around projected savings rather than actual P&L impact.  This discovery has unleashed an avalanche of post-contract margin-grabbing tactics, from billing for non-existent inventory to charging premium rates for basic services during crisis situations, that are diluting procurement value creation. This episode reveals a fundamental paradox within procurement: while they consistently report driving value in multiple ways (sustainability, risk mitigation, social impact, strategic sourcing for M&A targets), procurement is still measured almost exclusively by narrow, often dysfunctional savings definitions.  This misalignment doesn't just harm savings outcomes; it may be crippling procurement's ability to deliver value across the business. Finally, this episode sets up the series' pivot from problem diagnosis to solution exploration, as the co-hosts discuss their plans for future episodes to examine how organizations can move beyond “savings” toward comprehensive “value” metrics that more accurately reflect the depth and breadth of procurement's true contribution.   Links: Rich Ham on LinkedIn Learn more at FineTuneUs.com  

"The way we start looking at every unit of work in a workflow flips from being something that's truly human-led to something that can be increasingly human-reviewed and driven, but not necessarily initiated as a human." Nick Heinzmann, Head of Research at Zip The pressure for procurement to do more with less means innovation is no longer optional… It's necessary for survival and growth.  The game changer? Agentic AI: artificial intelligence capable of perceiving, analyzing, and taking action, all with minimal supervision. In this Art of Procurement podcast episode, Philip Ideson interviews Nick Heinzmann, Head of Research at Zip, to dive deep into real-world applications and opportunities that Agentic AI holds for procurement.  Nick demystifies this powerful technology, showcasing practical ways it is already being used to automate workflows, solve procurement headaches, and address age-old data challenges. In this episode, Nick covers: How to identify workflows ideally suited to AI-driven automation Understanding what Agentic AI is (and isn't) Procurement use cases where Agentic AI adds immediate value How to overcome traditional roadblocks like data quality concerns Links: Nick Heinzmann on LinkedIn Unleashing the Power of Generative AI in Procurement Subscribe to This Week in Procurement Subscribe to Art of Procurement on YouTube

Procurement 6 is a short podcast from Art of Procurement that publishes in the Art of Procurement feed every Friday morning at 6am US Eastern Time. Presented by a member of the Art of Procurement team, each episode has 6 short segments that summarize the week in procurement. Segments range from procurement tips to podcast summaries, from details of events to news or overviews of blog posts that capture our attention.

“The greatest challenge facing the world today isn't tariffs or monetary uncertainty – it's stagnating productivity.” - Baber Farooq, Senior Vice President, Product Marketing SAP Ariba & SAP Fieldglass Navigating today's interconnected global business landscape has thrust procurement directly into the heart of strategic risk management. Supply chain disruptions, new AI-driven realities, looming ESG regulations, and shifting diversity initiatives pressure leaders to redefine procurement’s strategic impact. In this episode, Baber Farooq, Senior Vice President, Product Marketing SAP Ariba & SAP Fieldglass, joins Philip Ideson to unveil pivotal findings from the latest SAP Economist Impact report: “The Resilient Edge: Procurement in an Era of Polycrisis.”  Baber shares why procurement leaders everywhere must proactively align their operating models to evolving global challenges – especially in preparation for generative AI, stringent sustainability standards, and shifting supply chain landscapes. Baber covers how to: Navigate escalating supply chain and geopolitical risks Prepare teams for an inevitable AI-driven procurement environment Prioritize ESG initiatives to anticipate regulatory impacts effectively Apply advanced spend analytics to move beyond simple reporting and drive actionable insight Links: Baber Farooq on LinkedIn Optimizing Procurement’s Source-to-Pay Strategy Bridging the Confidence Gap to Achieve the Best Business Outcomes Learn more about SAP Subscribe to This Week in Procurement Subscribe to Art of Procurement on YouTube  

Procurement 6 is a short podcast from Art of Procurement that publishes in the Art of Procurement feed every Friday morning at 6am US Eastern Time. Presented by a member of the Art of Procurement team, each episode has 6 short segments that summarize the week in procurement. Segments range from procurement tips to podcast summaries, from details of events to news or overviews of blog posts that capture our attention.

Sometimes the most damning evidence about an industry or an organization comes from the inside. In this second installment of “Buy: The Way…To Purposeful Procurement’s” deep dive into supplier tactics, two former supply executives continue exposing the ins and outs of the supplier playbook they used on procurement when they were on the other side of the fence.  Bob Schreiner, former CIA section chief and G4s operations executive, explains how security guard service providers can obscure margin increases within seemingly reasonable wage adjustments for officers. He also exposes the “position rate variance” tactic, where suppliers charge premium rates for senior guards to fill junior positions, and also how disasters can become margin-grabbing bonanzas for suppliers. Keith Robinson, one of only 150 board-certified entomologists working commercially in North America, exposes seasonal billing schemes in the pest control industry, where compliance rates plummet in colder months, yet billing continues unchanged. Perhaps most shocking is his revelation that 80-90 percent of fogging and fumigation services are often completely avoidable. These true stories from industry insiders point to a troubling reality: procurement is sometimes so focused on up-front savings that they inadvertently signal to suppliers exactly how to game the system. In effect, procurement ends up creating the perfect conditions for the kind of post-contract chicanery that can create significant cost increases for the business over the years, without any change in service scope or delivery.    Links: Bob Schreiner on LinkedIn Keith Robinson on LinkedIn Rich Ham on LinkedIn Learn more at FineTuneUs.com

“Procurement officers are going to have to go hunt for the solutions they need and the workflows that can help their business. I do feel like to do this job properly moving forward, it's an offensive job, and you don't have the luxury of sitting back.” - Matt Ziskie, Co-Founder, Bungalow Capital How procurement approaches working with smaller, innovative startups can look quite different than other supplier relationships. From lengthy sales cycles, complex negotiations, and mismatched expectations… these and other roadblocks can crop up in different ways depending on the size, scale, needs, and maturity level of the supplier. Procurement has to understand the unique needs and constraints that each type of supplier brings to the table. In this episode of Art of Procurement, recorded on stage at Catalyst LA, Philip Ideson speaks with Matt Ziskie, Co-Founder of Bungalow Capital, about bridging the gap between enterprise procurement and startup innovation. Matt offers a unique perspective, having worked as a procurement leader at companies like Box and Airbnb, and now as an investor helping startups navigate enterprise sales. In this episode, Matt explains: Why enterprise procurement teams should consider segmented processes when working with startups  How to mitigate the "fragility" of startup partnerships without ignoring the tremendous value they can provide The importance of communication and transparency to understanding the real financial impact of enterprise contract terms  Practical ways to support startups beyond contract terms, including coaching, references, and protection from scope creep Links: Matt Ziskie on LinkedIn Subscribe to This Week in Procurement Subscribe to Art of Procurement on YouTube  

Procurement 6 is a short podcast from Art of Procurement that publishes in the Art of Procurement feed every Friday morning at 6am US Eastern Time. Presented by a member of the Art of Procurement team, each episode has 6 short segments that summarize the week in procurement. Segments range from procurement tips to podcast summaries, from details of events to news or overviews of blog posts that capture our attention.