How to build a high-performing procurement function

Why Procurement Matters Now More Than Ever

In today’s rapidly changing business landscape, procurement is more than just a set of rules and templates – it’s a strategic function that can illuminate the path to success. TargetedBrains’s latest research, Procurement as the Guiding Light, draws on research from 81 Australian organisations to reveal how effective procurement helps businesses navigate market challenges, foster innovation, and achieve true value for money.

Procurement, when set up well, acts as a guiding light – helping organisations spot what’s ahead, avoid trouble, and find the best path through complex markets.

Our research shows that mature procurement functions don’t just react; they plan ahead, align with organisational goals, and proactively manage risks. This strategic approach leads to better results, more innovation, and stronger relationships both inside and outside the organisation.

Procurement Challenges

Despite its potential, many organisations face persistent barriers that hold procurement back:

Patchy Planning: Most organisations lack a long-term procurement plan. Without forward-looking strategies, teams struggle to resource and align with business objectives.
Reactive Market Engagement: 80% of organisations only engage suppliers when a specific need arises, missing out on valuable market insights and relationship-building opportunities.
Limited Innovation: Only 25% actively encourage innovation, and just 9% have embedded it in their culture and supplier relationships. This means missed opportunities for improvement and differentiation.
Governance Gaps: While larger teams tend to have robust governance frameworks, smaller teams often lack the systems and structures needed to manage risk and ensure compliance.
Structure Matters: Centralised procurement teams consistently outperform decentralised or hybrid models, achieving higher maturity in leadership, governance, and engagement.

Recommendations for Building a High-Performing Procurement Function

Procurement as the Guiding Light doesn’t just highlight challenges – it provides actionable recommendations to help organisations move up the maturity curve:

Develop Forward-Looking Plans: Start with a simple, strategic procurement plan that looks at least 12 months ahead.
Engage Suppliers Proactively: Make time for regular conversations with suppliers to gather market insights to inform decisions and strengthen relationships.
Foster Innovation: Create space for experimentation and encourage new ideas. Even small changes can make a big difference.
Build Tailored Governance Frameworks: Invest in systems and structures that fit your organisation’s size and needs, integrating risk management and compliance into everyday processes.
Invest in Centralised Teams: Dedicated procurement teams deliver stronger outcomes, providing greater oversight, expertise, and consistency across the organisation.

Ready to Shine a Light on Your Procurement Maturity?

Procurement as the Guiding Light offers a practical maturity assessment framework, allowing you to benchmark your function against peers and identify areas for improvement. Whether you’re looking to build a business case for investment, improve strategic alignment, or simply understand where your strengths and gaps lie, this is your essential guide.

Don’t leave your procurement maturity to guesswork. Download Procurement as the Guiding Light today and start charting a course for better outcomes, greater innovation, and lasting value.

Need a guiding light? Book a meeting with Stefan Gassner, author of Procurement as the Guiding Light and TargetedBrains MD