Ep.05 Simon Geale @ Proxima - Digital Transformation in Procurement

The biggest challenges procurement is facing today and what the next big things in 3 to 5 years will be.

In this episode we’ll be talking about:

- Some of the biggest challenges Procurement is facing today.

- Practical tips on what Procurement should be doing to align with the overall business goals.

- Digital Transformation in Procurement.

- What sets apart good CPO's from great CPO's - and some shoutouts to some CPO's he thinks are really pushing the envelope today.

- The importance of storytelling.

- What are some of the big trends in Procurement & supply Chain in the next 3 to 5 years? 


Host of The Way We Source: Sam Jenks


And here's the episode:

Today we have the pleasure of hosting executive VP procurement at Proxima, which was recently acquired by Bain and Company. A keynote speaker and advisor to CPOs, thinker and a person that I very much would like to share a beer with one day: Simon Geale!

Simon, welcome to the show. Did I butcher your last name? I see you laughing..

You butchered my last name. This is like the second time we've done this. And say all those nice things and then you get my name wrong at the end.

Sorry Simon. I have to start with a question that we ask a lot of our guests that we have on. What exactly does procurement and sourcing mean to you?

Oh my goodness. It's the job profession. It's kept me employed.

No. So I started out in sourcing and procurement. It was the first thing I did as a sort of grownup job. And look, it's enabled me to different things: Test myself, learn, grow. I've worked with brilliant companies, wonderful people. Made some friendships that will last forever.

So I have a very sort of personal view on it. Cause after almost two decades, it's probably shaped me a little bit more than I care to on. And hopefully vice versa. But I think besides that, I think I've got a passion for learning. I've got a passion for change. For delivering stuff, for camaraderie, challenge.

And I've found it all in sourcing and procurement, I think, and now more so than ever. So for me it's the canvas for a really great fun career.

Fantastic. I think this is an interesting thing that we've talked about with a few of our guests, David Latin from Logitech, as well as Kelly Barner an expert and also a definitely a content guru in the space, about whether they choose or procurement chooses you. 

I'm curious what, why have you chosen the field of procurement? Or is it so that procurement chose you?

Growing up I wanted to be an actor, a journalist, a DJ or a PE teacher. And I always thought that one day I'd wake up and know what I wanted to do, but that still hasn't happened.

And I love that, but I also envy those who had a calling a little bit. So I did fall into it. Yeah. Not entirely by accident. I can't say that, I went and did a master's course in procurement. Okay. And therefore, even though I wasn't quite sure what procurement was when I applied for that master's course. The inevitable outcome was that's what I went into, but I stayed in it because of all those reasons really. And aside from a few blips, which are largely down to my personal motivations; that ability to have variety, make an impact, do interesting work, meet interesting people it's never gone away.

And I think that procurement is an exciting is standing in front of a very exciting time currently and has been for the last few years, not only with digitalization that's ongoing, but also with the various challenges that they face as a role. Because change has been one of the main things that's been constant during the past few years.

And I know that you, in, in your role, you're often brought in as an advisor to CPOs, somebody that's brought into context where the customer is facing a rather big challenge within the procurement organization. You don't get brought in for the easy times, right? You get brought in for the challenging times, I assume? 

I'm curious with this knowledge at hand, what would you say is the biggest challenge that procurement is facing?

Goodness, Sam, pick a favorite child. We're in that sort of territory now. Yeah. We all know we've got one. They're not listening.

No, they're not listening. Trust me, this is the last podcast that your kids are listening to, so don't worry.

I think it's funny isn't it? Because what you do day to today generally informs your sort of opinion bias on that sort of thing. And you're right. In consulting, we are usually there to provide either capacity or capability or both, often around a big hairy problem. Big hairy goal, opportunity, whatever. And I actually do presentations on this where I go and talk to people about here's the challenges that other CPOs are facing. And it probably wouldn't surprise you that there's about eight things on that wheel. It's a bit of a cop out, but you can say the biggest challenge they're facing at the moment is that they've gotta deal with everything everywhere, all at once.

And I talk about it like it's a vice. So if you imagine you've got a vice crossed with a pie chart, if you can imagine that. So you've got all these segments which are closing in on different degrees. And you think that in those segments you've got things like value chain transparency, you've got planning, you've got talent, you've got experiential all these sorts of things.

And they're squeezing CPOs or businesses or CPOs to a different degree. So the experience is not really uniform. And the biggest challenge is how to face into that, how to lead your team into that, because the worst possible outcome is inertia. Saying that’s someone else's problem, I'll wait.

Or not being sufficiently motivated to take the opportunity and lead your team into it. So I think, in times of adversity, the biggest challenge can be, just how to plow on.

How do you think procurement teams need to plow on? What are the ways that they can get there so to say?

I actually think we're probably living in times where you can't do everything everywhere all at once. Unless you have unlimited budget. And so I think, one of the challenges which often faces procurement teams is that they've tried to do everything everywhere or they've divided up spend and said we're going to focus on this bit.

I think really, the key to an effective and valued and loved procurement team is that they do the things that the business is really asking them to do. So I think focusing in on, what's the current business objectives? What's the business really trying to achieve right now?

And focusing in on that's where you make the most difference.

I think that a lot of procurement teams during the last few years they're looking to, for the buy-in from the rest of the business and obviously becoming really that support function to drive, whether it's savings or top-line value for the business is a great opportunity to be able to get that buy-in.

But I do you have any additional practical tips other than focusing in on what the business needs for procurement teams maybe to find themselves in more of that value driving?

Yeah, I think so. This is probably one of my favorite topics. Because I think you've gotta get yourself into that position. What you're essentially asking people to do when you're in procurement is: look, trust me, I'm gonna help you to get a better outcome than you can get yourself. And that's a pretty big ask.

So how do you build that trust? How do you make the case that convinces someone to act, that convinces them to trust you? And I think that I'll come to my sort of passion on this in a second, but there's a thing called the trust equation, which is probably the most consulting thing I'll say today,

But the trust equation is essentially: credibility, reliability and Intimacy over self-orientation. So broadly it's about are you credible? Are you reliable? Are you there? And are you authentic or nice to deal with? And that trust gets built up over time. Thinking about how you can build trust, that's what really unlocks your ability to go and do it in the space where you're not today.

But the two elements that I'm quite passionate about when I delve into that concept usually is; number one: customer centricity. And number two is storytelling. So what do I mean by customer centricity? Don't mean just being close to your customer. Walking in their shoes, understanding them, understanding what keeps them up at night. I believe that if you walk into a room and ask your customer, hi, I'm procurement, what can I do for you? You will always be constrained by their view on what you can do for them. Whereas if you understand them and what they're trying to achieve and the things that they think perhaps you can't help with, then you can start to surprise them. You can start to unlock new levels of trust and new levels of influence. So I think that's one thing.

And then I think the second thing is really about storytelling and your ability to go and tell great stories. Tell the stories that inspire change. There's a lot of neurological research out there that suggests that, decisions are made on emotion rather than logic. So I think you've gotta think about, what's the purpose of my story? Who am I telling it to? How am I gonna tell it? And, how am I gonna be when I do it? Telling great stories can move people to take risks, do different things and ultimately act.

Well. Emotion plays a big role. That's why you're on this podcast. You weren't thinking with your head. You were thinking with your emotions. Simon, you signed up unwillingly. No, I'm joking.

And obviously that's something I've gotta live with and and have done for the two times that we've now recorded this.

No, exactly for those out there listening, unfortunately Simon's first go around did not record. So we're doing take number two here and it feels already better at this point in time. So I'm happy with it, Simon.

Let's get into the transformation bit for a bit, because I think that you mentioned some interesting things there. Storytelling a as well as then a trust to the business. Two elements that I think a lot of. Procurement leaders of today's modern procurement team are focused on building more of a vision for procurement, but the fact is that the role needs to change from just being a support function that's helping people to buy and negotiate and cut costs.

How do you think that this is going to happen in the future? I How does a procurement team continue to future proof itself?

I often have a sort of a sort of hypothetical intellectual debate with myself about the term future proof and whether I believe in it or not.

Because I think the I suppose our future in a way will be will be defined by what we do now and our businesses - the amount of trust that we can build within businesses around being able to help them with these big hairy problems that they're facing. So I think there's probably a level set there.

But I actually think that, leading a procurement function today is about evolving that procurement function. So it's about, even if the steps are small, having a big vision of where you think it's going to go. And something that particularly in times where talent is scarce that people can get behind and be a part of. I think that's really important.

But ultimately, future proofing is probably about relevancy. And to be relevant, you have to tie procurement into what the business is trying to achieve. So it can't be harder or worse or less enjoyable than somebody doing it themselves. It can't hold them back. Of course, that means new tech, new skill sets etc. But fundamentally, I think it means that the services are relevant. And it means that the way you provide the service is relevant, and therefore you know the people that you need and the diverse skills and opinions and all of that follows.

But if really thinking of this through, I think two other things leap out: Number one is that you need your CPO to lead. So CPO's got to be effective. I had a colleague once who left us recently actually, and I think this is probably quite divisive, but it is a perspective. He used to say; the three things that make a super effective CPO is their ability to create the vision, their ability to play the politics and their ability to get money. And I thought that was really interesting. Cause not a lot of people say that about their ability to drive change.

The other thing which I find really important personally and I try and encourage, is that I think it's really important to create a safe space where your team are prepared to come in and try and evolve and do new things and push things forward. And not be afraid to fail or be knocked back, or that you are receptive to ideas. Because I think that creates a culture and a mindset where people do push things forward.

And it's so interesting and important that you're focusing in on the aspects that are the softer elements of what procurement has to offer. Because I think that we're also focused on the hard skills getting down to the numbers; how much can we slash?

I think that it's important aspects that you focus on and I think that the teams of tomorrow are shifting. Within their tech, within their processes, within the talent that they're bringing on. And I think that, transformation is as you like to say, the big hairy word.

But the fact is this transformation is ongoing. What do you think some companies are getting right? And what are they getting wrong when it comes to transformation within procurement? Do you have any things that are glaring that you see as a trend in the market?

I think you summed some of it up in that question there, and the way you phrased the point there around the soft things and the soft skills. If I was to say one, what do I think people are getting wrong? I think probably not solving what they wanna solve rather than what's good for the business.

Transforming into something which is perhaps, irrelevant for the people that you serve, or not focusing on something that solves a problem. I think insufficient focus on the case of change or change management. I think making it look big and then delivering small. Or not dreaming big enough. All those things can set you off on a rocky road.

But in about 2019, there was this incredible paper that was written on digital transformation. It was incredible. Because I wrote it. It's instantly forgettable.

But essentially it was a digital questionnaire, because we love to do questionnaires. We asked some questions around transformation and particular with the digital salon.

And this one thing that I always remember. Two stats. I always quote the first one; that about 30 to 40% of the people we surveyed expected their transformations to be judged of failure before they'd even started. Which was a, a group of akin leaders expected that the transformations they were about to embark on would be deemed a failure before they'd even started.

I think it's important for that for the listeners to hear that it's a feeling of negativity in the business.

Yeah, that's getting off on the wrong foot massively.

The second one was that about half probably a little under half said that their biggest barrier was their ability to sell the case upfront to the people who had the purse. And I thought that was really interesting. So where does transformation go wrong maybe before you even start? Now what are they getting right? The thing is, it's probably two sides of the same coin.

If we take that digital space and you look at people who I'm big fans of, people like; Sam De Frates at Mars and Adam Brown now at Maersk, formerly BT. They know why they're doing it. They're doing it to make the business better. There's a purpose simplification in their narrative.

It's understandable. And it's delivering.

There's a lot that you've unpacked there and some really great tips, I think for anyone that's listening that is a procurement leader or looking to stepping into a procurement leader role.

And I think that one of the things that you also mentioned about was the fact that, transformation encapsulates digital. Technology is continuing to grow within the space. And not to get too much into a digital procurement conversation here because there's a lot of talk about it in various contexts.

What do you think are some of the big trends or movers so to say happening in the next three to five years in Procurement?

I think in the next three to five years we'll all be holograms communicating through film. We’ll all have chips in our head. No, there's the chip shortage. Maybe six years.

There's this sort of deafening noise around digital at the moment. And I'm a big fan of best-of-breed, but I do think that there's so much noise.

You and I saw each other at DPW, and if you don’t know it’s an awesome event in Amsterdam each year. Matthias Gutzmann has done a fantastic job building up an awesome event with awesome speakers. It's glossy and fantastic. And it has the who's who of ProcureTech. That's the 10%, right? If not even if maybe even 5%. It's us fan boys. It's us who love procurement technology. But where's the rest? They're sitting in a totally different situation.

I think you're absolutely right and I'm a massive fan of DPW and Matthias as well. We talk a lot about disruptors in this space. The reality is that there's very few disruptive solutions out there. And very little disruption happening. But he's delivered it. He's delivered disruption.

But, so let's not talk about procuretech. Let's talk about something else.

This is probably the second sort of consulting bullshit thing I'm gonna tell you. But , it's absolutely true. So we're in the middle of the fourth industrial revolution. So industry 4.0, we talk a lot about Industry 4.0. For people who dunno what industry 4.0 is, I’ll give you a quick Google. It's basically the talking fridge, connected technology, 3D printing etc.

The interconnectivity of things and technology.

Absolutely. And what I really like. This is because we are not inventors or many of us are not inventors. You might be an inventor in your spare time. I dunno. But we're not inventors. So we're not sat there going, oh, what am I gonna build out the fourth industrial revolution? Someone else is gonna do that. But if you look back at the previous three industrial revolutions and you think about what came out of them, you can start to get an appreciation for the scale of change that we're facing into.

And that we're on the precipice of things like the first industrial revolution steam. The ability to industrialize clothings and building materials up and down the country.

The second one, electricity, electrification, light bulbs, airplanes.

The third one: the internet connectivity in that way.

And now this.

And anyone who's about about my age, so early thirties. Alright, mid forties. We can remember the changes that we've been through. Through the last industrial revolution, right through the birth of the internet.

And that said what it was like before that. And I just think it's really exciting that we're facing into this seismic change that many of us don't really know what it's gonna be, but we know that in our space, the outcome's gonna based on the challenges that we are facing today. The answer to which is transparent and interconnected, value-based ecosystems, and that's what we're gonna move towards, in my opinion. That's a personal opinion. But I think that's what the fourth industrial revolution is gonna deliver in our space.

Yeah. And I what do those ecosystems look like, if you could expand upon that, for the listener out there?

Okay. So I use the term value-ecosystems very deliberately. Because I think, over the last two years, we've accelerated through this sort of concept of my suppliers, my supply chain, my value chain.

And the value chain is about joining up all the orchestrated parties from suppliers, customers, internal operations, regulators et cetera.

That's the ecosystem in which a business lives. So it's employees, your own conscience, the regulator, the customer and your ability to react to those things and create something that can operate and excel in those things will be based on how transparent and connected that ecosystem is.

And that's what we'll work towards. And we see this at the moment with Best-of-Breed, which essentially lacks an experience layer and a data layer to pull it all together and make it all work super cohesively. That the pioneers go and build something and then the settlers go and buy something.

We wait for those utility solutions, because whilst a lot of our tech is available today to make this sort of concept work. It’s reserved for the people who've got the amount of money that can go and build it. Which is very few. And the amount of power over their suppliers to get the data, which is very few.

So I think we're starting to see what's possible but it's not yet necessarily practical.

It's a fantastic way of putting it. How can we get to a practical place? Maybe that's the last question that I have for you? Not an easy one.

I think you're breaking up there, Sam…

No but I see it as: think as consultants, as practitioners, as solution providers, like ourselves. I think our job is to create that vision and work towards it. But it sounds a bit glib, but we'll get there when there's money to be made in getting there.

And I've spent a while trying to sell software. I was very bad at it. I'm, yeah, very bad at selling in general, which is why I don't do it. But my CEO said to me one day; in software sales, what you're looking for is the person who's got the problem, knows they've got the problem, knows that they'll be fired if they don't solve the problem and has the budget.

And you know that's meaningful demand for a vendor to go after. And if you can find lots of people like that, the challenges that we're facing today around risk and scope three and blah, blah, blah. Suddenly all this meaningful demand is created that enables vendors and investment houses to plow money into it and say; you know what? We're gonna solve these things.

And when the tidal wave comes and the demand side suddenly says the next thing is that we want complete transparency over these ecosystems, over the value chain. Whatever phraseology they use, they probably won't use that phrase cause it's a bit of a mouthful.

At the point where they do. I think that's the point where the investment goes in and the solution providers all rally behind it and the consultants etc. Because as someone once said to me; the pioneers go in and run the hard yards and the settlers come in and make all the money.

I think it's a great point. And something maybe to leave our listeners with.

I'm super happy that you joined us. I'm super happy you acted upon a motion and took the time to be on our podcast, Simon. And whether you're a good salesman of software or not you've sold yourself to all of our listeners, I'm sure.

Where can people get in touch with you if they're interested in doing so?

Just say my name three times and…

Rub the bottle and you'll pop up like a genie, huh?

Yeah. The obvious one is is LinkedIn, Simon Geale. I work for a company called Proxima so you can find me on LinkedIn.

Do get in touch because I really enjoy. Meet new people and getting new experiences and learning new things. I'd love to meet more people like that.

And I think that you, those that are out there that are looking to transform should definitely reach out.

But you're not gonna get off that easy yet, Simon. We're, we've then entered now into our famous little part of the every episode where we do a segment that's Kodiak moment.

But they had, they, they had of course the Kodak moment, right where you were sharing a special moment together.

Three quick questions and off the top of your head, short answers.

If you are eating dinner, you have the opportunity to eat dinner with somebody that is alive. Anybody in the world, who is it?

It would be my wife. Without my children.

Now we really hope that your children are listening to the episode.

Yeah, I love my children, by the way.

We'll clip out that sound bite so you can be able to hand it over to your wife as well.

Okay, thank you. That's very kind of you

On top of that. If you are heading on a vacation, all expenses paid, maybe you're going with your wife as well. Where are you guys heading?

The best place I've ever been to that I enjoyed the most was probably Japan. And I'd love to go back and I went there on work. I'd love to go back and explore it a bit more.

Very nice. What book are you reading or a book that you would suggest right now?

Can't read Sam.

Honestly. I don't mean that in a funny way ”oh I can't read”. I find it really hard to read books.

Podcast or something you're listening to that you could suggest?

That's a good question. I've got no idea, Sam, I've got no idea.

That's no worries. Sometimes ”I don't know” is an acceptable answer, Simon.

I say I can't read, but actually I speed read three books on my last holiday. So I did, I was in Krakow and I read the Tattooist in Auschwitz. I read Victor Frankl, Man's Search For Meaning. And I read Airhead by Emily Mala, who's a news presenter on current affairs over in over in the UK. So those are the last three things I read.

There you go. Buy one, get three for free there. That's what we had.

Thank you so much. Simon, it's been a pleasure having you on the episode today and I urge everybody that's looking to work towards transformation or looking just to have an interesting conversation to reach out to Simon Geale. G E A L E. It's easy to mistake it for Geel, but Simon Geale on LinkedIn or alike.

Thank you so much for being on today's episode, Simon.

Thanks Sam so much. A real pleasure. Thank you. Nice to see you again.


Simon Geale on LinkedIn

Proxima Group

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