Last week’s diatribe on the requirements for the new era of supply management caused quite a stir. While all commentators agreed with the principles of Supply Management 2.0, some argued that many supply organizations are not yet prepared to embrace this new responsibility.

I agree with this assessment. (That was the point of sharing examples of supply management organizations that were either misguided in their thinking or stuck in a rut. Or both.) However, I refuse to accept current deficiencies as a fait accompli.

This need for change was driven home in a conversation I had last week with an old acquaintance, Jeff Wincel, former Big Three procurement manager and former head of purchasing and supply chain operations at Donnelly Corporation, a leading Tier One automotive supplier. Jeff has summarized supply management transformation practices of these organizations into a must-read book: Lean Supply Chain Management: A Handbook for Strategic Procurement. He has since founded LSC Consulting Group to help companies employ these principles for supply management improvement.

Jeff reinforced the need to set aside such group think, arguing that supply management will never advance as a strategic discipline without accepting a new mindset:

“The fundamental mindset change that must be made is that procurement and supply chain organizations should not be treated as cost center support services, but as potential profit centers. This is possible only when executive management recognizes the potential profit contribution of strategic supply chain management and understands that the improvement potential of such an organization far outweighs its overhead costs. It is then that true strategic supply management can be effectively deployed.”

Securing executive support for supply management transformation won’t just happen. You will need to help frame the dialogue for executives, so they understand not only supply management’s current contribution to the business, but als your vision to transform the function into a center for value creation. (Read this for tips on how to gain executive support.)

In the spirit of lean simplification, I boiled the characteristics of a Supply Management 2.0 organization into the table below. Feel free to use this table both as a litmus test to diagnose your current supply management competence and as a framework to set your path for improvement.

To learn the techniques your peers are using to drive supply management transformation and improvements, register to attend the Supply Management 2.0 forum in a city near you.