What does a Procurement Manager do? Job Description, Skills, and Qualifications
As firms continue to leverage technology to carry out sourcing and procurement tasks, market demand for procurement is growing. The global procurement market was valued at $6.15 billion in 2022, and it’s expected to grow 11.1% from 2023 to 2030.
Procurement managers play a key role in this rapid growth, helping organizations optimize costs, negotiate favorable terms with suppliers, and ensure financial efficiency. The best procurement managers are masters of risk mitigation and budget management, while also maintaining high quality standards and a competitive edge. Even more importantly, they help drive an organization’s strategic goals, pushing for ongoing innovation and productivity.
But what does the day-to-day role of a procurement manager look like? And what does it take to become one?
In this article, we’ll dive into the world of procurement management, explaining the details of the job and the skills needed for success. We’ll also explain how today’s top procurement managers leverage new technologies to further optimize outcomes and streamline processes.
Procurement Manager Job Description
A procurement manager oversees the process of buying goods and services for an organization. Virtually every industry utilizes procurement to some extent, but the top industries include manufacturing, construction, healthcare, automotive, and energy.
No matter the industry, the primary goal of a procurement manager is to make sure the company gets the best quality products at the best possible value — but it’s a task that’s easier said than done.
To achieve their goal, procurement managers must learn the art of sourcing and managing supplier relationships, negotiating costs, complying with laws and regulations, and more. They must constantly stay ahead of market trends, researching to understand changes in pricing, supplier landscapes, and industry regulations. This information allows them to make informed decisions when negotiating contracts and agreements with suppliers later in the day.
So what does a Procurement Manager do?
On a daily basis, procurement managers engage in a range of activities to ensure the smooth flow of goods and services for an organization. They spend much of their time analyzing inventory levels, assessing current and anticipated needs, and identifying potential gaps in the supply chain.
Everyday responsibilities include a range of activities, such as:
- Supplier sourcing
- Cost negotiation
- Market research
- Quality assurance
- Contract management
- Risk management
- Supplier relationship management
- Policy compliance
- Budget management
- Technology utilization
For every facet of a procurement manager, communication and collaboration are key. To avoid organizational silos, procurement managers must act as a liaison between various departments, understand their specific procurement needs, and ensure alignment with the organization’s goals.
Procurement Manager Skills and Qualifications
The demand for procurement professionals is on the rise, due in part to global economic recovery, evolving business needs, and technological advancements that are driving digital transformation. Currently, there are 142,149 procurement managers employed in the U.S., along with 30,430 active job openings. Pay varies depending on location, with jobs in California and Texas offering competitive salaries of $100,000 or more.
So what does it take to land a job in procurement?
First, it’s important to have a bachelor’s degree, since most employers see this as a minimum education requirement to be considered for the job. Procurement management isn’t associated with one specific degree, but many majors could prepare someone for the industry, such as business, economics, supply management, or finance.
Some procurement managers gain a competitive advantage by earning a master’s degree on top of a bachelor’s degree. A Master of Science in supply chain management offers detailed education on many aspects of procurement management and can help candidates stand out in the job market.
To excel in this role, a procurement manager should possess a diverse set of skills, ranging from negotiation to relationship management. Here are some of the top skills for success in procurement:
- Negotiation skills: Secure deals and optimize savings through effective contract negotiation with suppliers.
- Analytical skills: Make informed decisions, evaluate supplier performance, and conduct cost-benefit analyses.
- Communication skills: Conduct clear dealings with suppliers, stakeholders, and team communication.
- Supplier relationship management: Build and manage reliable supplier relationships for optimal performance.
- Risk management: Identify and address supply chain risks for uninterrupted goods/services supply.
- Contract management: Possess a legal understanding to manage contracts, terms, conditions, and dispute resolution.
- Project management skills: Plan, execute, and monitor procurement projects for effective sourcing.
- Financial understanding: Working knowledge of financial principles, budgeting, and cost analysis for cost optimization.
- Ethical conduct: Maintain high ethical standards for fair and transparent procurement processes.
- Adaptability: Stay open to change, new technologies, industry trends, and best practices.
- Leadership skills: Guide, motivate, delegate tasks, and foster collaboration in managing teams.
Optimizing Procurement Management with PPO
Procurement management is a complex role with many moving parts. To be successful, it’s important to possess a blend of interpersonal skills and business acumen, with a sound understanding of communication, contracts, budgets, and more.
Fortunately, new technology is easing the burden placed on today’s procurement managers. Tools like AI and machine learning are transforming supply chain management, contract writing, and other aspects of procurement to make them more streamlined and efficient than ever before. With software like Predictive Procurement Orchestration (PPO), procurement managers can make better buying decisions faster and across all categories of spend.
PPO relies on internal and external data to reveal insights, drive action, and optimize results. Procurement managers can leverage these tools to optimize daily operations in the following ways:
- Manage more spend
- Quickly identify opportunities
- Reduce friction with suppliers
- Speed up negotiations
- Minimize supply risks
- Reduce costs
- Amplify procurement’s influence
Ultimately, PPO helps procurement managers extend their reach without adding to their headcount. It uses machine learning, game theory, and behavioral science to learn from spend history and buying patterns, helping to automate future buying decisions.
Gain a Competitive Advantage with Arkestro
Procurement management is a promising career path with many opportunities for the future. As organizations increasingly rely on technology to optimize the procurement process, purchasing managers will play an even greater role in helping organizations optimize spend.
Whether you’re an aspiring procurement professional or a seasoned one, Arkestro’s Predictive Procurement Orchestration can help you get ahead in your career. Speak with an expert today to learn how PPO is revolutionizing procurement strategy and execution.