Procurement & Supply Chain – Market and Hiring Trends February 2023
Welcome to our first newsletter for 2023 highlighting Procurement and Supply Chain hiring trends in Quarter Four 2022 and the Outlook for 2023.
The final quarter of 2022 was yet another buoyant period for the sector. It was also a record-breaking quarter for psd in the Procurement and Supply Chain sector with more placements made than in any other quarter. We have been active in all our core areas especially Banking, Construction and Energy. We have also made placements in Technology, Central Government and Travel. Most of the requests have come from our reputation as being one of the most prominent names in Procurement and Supply Chain Leadership recruitment.
Technology continues to be the prominent trend in the development of Procurement and Supply Chain teams. Advances in AI and the integration into platforms have enabled the sector to be as efficient as ever and there is still room for improvement. Whist there is a slight decrease in the size of teams in procurement, there are still opportunities for Senior Leaders who orchestrate how a supply Chain function can best serve the company. Savings is higher on the agenda more so than in previous years due to inflation and other increased costs. Supply Chains are still challenged so Leaders need to be creative in cost management, whilst balancing risk and ensuring organisations are compliant especially in regulated industries.
2023 will be another successful year for Procurement and Supply Chain sector. CEOs and CFOs will rely on the Procurement Community to ensure the cost base is well managed but not at the risk of hindering growth and expansion. It is the strength of a Leader that can orchestrate this and psd is able to identify these individuals who will make Procurement Department World Class.
Banking and Financial Services
Construction and Infrastructure
Banking and Financial Services
The sector was as busy as ever in Q4 with several placements across a broad range of companies. Most of our placements were in investment and retail banking. There were also a number of placements with Fintech and insurance businesses. A trend that we noticed was an increased focus on Professional Services and Non IT categories in the period. We placed a Head of Professional Services with a global investment bank and a Head of Vendor Management with a high-profile retail bank. There was also a focus on Procurement Technology implementation and transformation in these firms aim to make the procurement departments more efficient. We placed several individuals managing transformation projects at various stages of maturity. There is more demand in this sector in 2023 and beyond. It was almost as busy as consulting and outsourcing but not quite.
We placed an interim Head of Software Sourcing with a major Asian Bank. This individual will coordinate the activities in a newly created global Sourcing function and therefore is a critical role for them. This has led to more roles with the Bank which has been a psd client for over 15 years and we are happy to serve them.
In the FinTech and insurance sectors, we have recruited a Sourcing Team for a firm that is still very much in growth stage but wants to keep an eye on third party spend. In the insurance sector we recruited a Head of Supplier Risk which was the first such appointment for the business. Rather than cost control, this individual will ensure that compliance and risk targets are maintained across the third party base. It was a challenging assignment and we were able to provide a strong shortlist that the client was happy with.
Consulting and Outsourcing
This was again psd’s busiest sector in the period with more hires than ever. Strong and sustained demand has continued into 2023. In Quarter 4, we placed a Head of Client Delivery for a global outsourcing firm. This was one of several placements with the firm with other placements located in the UK, New Jersey and Romania. This position was to manage a major banking client for the organisation.
We also continued to work with a Global Advisory Business that we have supported 2013. We hired a Head of Coupa Implementation for the Procurement Transformation Practice and are hiring their direct reports. We are also busy on searches in the BPO Sourcing Advisory area in the HR and Finance Shared Service functions.
We are now engaged in a range of positions with newer, more agile firms that are competing well with the larger firms. It’s an exciting area where we are proud to have a solid reputation and track record.
Energy and Utilities
We are working hard to ease the energy transition by supporting our partners and innovators within the power generation sector. We have successfully identified the UK&I Managing Director for a blue-chip integrated energy solutions provider, supported a global facilities management business in the formation of their sustainable sourcing department and are currently assisting in the growth of a telecommunications developers procurement and commercial team, who are investing heavily in secure, sustainable digital infrastructure.
In the last quarter alone, we have all seen significant increases in the wholesale (and subsequently, retail) cost of electricity and gas, alongside short-term disruption in the distribution channels of many of the UK’s fuel retailers. The role that innovative Procurement and Supply Chain professionals play in the management and avoidance of disruption is key to success during this volatile supply market. This has created opportunities across all industries as business leaders have been forced to rethink and reinvest in their supply chain strategy.
Within the water sector, we continue to identify strong commercial professionals to support the investment programmes required to overcome challenges around storage, delivery, and treatment. Our most notable project was supporting in the implementation of a new procurement transformation programme by successfully identifying a new Procurement Manager (Head of) and Procurement Business Partner.
We have also supported a long-standing client within the Oil and Gas sector on an interim technology sourcing assignment, alongside identifying several interim contracts advisors for a new project in Africa. It is encouraging to see the diversification of many traditional Oil and Gas companies, and we are excited to support our partners on new projects encompassing their investments in solar, wind, hydro, EV, and energy storage infrastructure.
Construction and Infrastructure
There has been a notable increase in demand for procurement professionals within the infrastructure consultancy sector. We have supported numerous practices in the growth and development of their advisory functions, with a variety of national assignments from consultant through to director level. Competition for commercial talent with expertise in major public sector infrastructure projects is fierce. For developing procurement leaders, infrastructure expertise combined with a deep understanding of NEC, JCT, FIDIC, or IChemE contracts offers the route to an exciting and lucrative career path.
We have seen a stabilisation of the market within the affordable housing sector and there has been few mergers and acquisitions compared to the past 18-month period. The emphasis now is on growing talented procurement teams, with a strong focus on implementing ESG assessments into all tenders. The events of the past 24 months have changed priorities for many procurement professionals, and we have supported numerous providers in identifying and securing private sector talent. Despite the significant challenges surrounding development, materials supply and cladding, the affordable housing sector is well positioned for professionals looking to reassess their work-life balance and make a positive social impact.
The residential development sector continues to tackle significant challenges surrounding material supply chains. Volatility in price, logistics and quality has put procurement professionals to the forefront of many organisations and we have seen significant investment in addressing ESG goals. We have supported a national developer in the formation of their new sustainable sourcing function and are pleased to see their progress in promoting local supply chains, utilising reduced emissions plant, and trialling a range of sustainable materials.
The Modular construction sector continues to grow in prominence. We have utilised our expertise within both manufacturing and construction to support several high-level appointments, and we are proud to field a diverse team covering all leadership functions within this innovative sector. Of growing importance is the ability to identify and attract innovative leaders who can provide expert advice on supply chain strategy, technology, and delivery. We anticipate that demand will increase in this sector as significant investments continue to be made, and we look forward to supporting in the delivery of more supply chain projects.
Facilities Management and Real Estate
While questions continue to surround the future of the workplace, investors and service providers within the Facilities Management and Real Estate industries remain confident of the critical role that offices play in promoting collaboration across companies.
Despite initial projections, there has yet to be any significant consolidation of real estate networks within the UK. Many employers continue to wrestle with their workforce location strategy, and we have seen a broad variety of office, hybrid, and remote strategies in place.
FM service providers are capitalising on their expertise to provide a variety of specialist services including supply chain advisory, digital infrastructure procurement and energy optimisation. There is a significant focus on reducing carbon emissions from the built environment and we are becoming increasingly involved in supporting procurement leaders to identify professionals who are passionate about achieving net-zero.
The core expertise in this sector remains around hard and soft FM procurement, though this is increasingly being challenged by fast-growing functions encompassing data centres, logistics, and advisory. PSD has been involved in a broad variety of projects across this sector where we have also sourced talent from across the technology, consulting, manufacturing, and construction industries. We anticipate the needs of procurement functions within this space growing alongside the variety of services being offered.
Director – Procurement & Supply Chain
Christian is Director of psd’s Procurement & Supply Chain Practice, leading searches for senior executives in the Financial Services and Professional Services sectors in the UK and globally.