New report reveals the challenges of employee turnover – and how training can bridge the gap and drive corporate outcomes
LONDON, 26th October 2022: More than half (53%) of senior procurement professionals say that retention in their function has decreased in the last three years – and 47% admit this is a problem, according to a report released today by high-impact digital training provider, Skill Dynamics.
Breaking the skills loss cycle in supply chain and procurement, analyzes data from over 200 procurement professionals across the UK and US*, to uncover what’s driving employee churn, the implications for procurement function, and how they can stop the trend.
This retention challenge is coming at the worst possible time for the procurement function. One in four (27%) of procurement leaders are looking to grow their teams over the next year, as economic headwinds make cost control even more important – yet 23% of junior professionals intend to leave their role in the next two years.
When asked about the drivers of employee churn, 57% of junior professionals cited the opportunity to get a higher salary elsewhere, 54% increased workload, and 41% limited progression opportunities.
“Competition for talent is certainly a significant driver of churn,” comments Howard Price, Head of Procurement Content at Skill Dynamics. “The number of procurement jobs has skyrocketed, which in turn has led to organizations offering higher salaries. Well over a third of those leaders we surveyed (41%) said that their organization was consciously offering higher salaries to attract people with the skills they needed. This is consistent with the CIPS Salary Guide, which found growth in UK procurement salaries over the past year.”
Almost all (95%) of senior procurement professionals are concerned about the negative consequences of employee churn, with professionals expressing particular concern about an increased risk of errors (39%), reduced agility (39%), low employee morale (38%) and loss of critical skills (33%).
At the same time, leaders struggle to fill the talent gaps with the necessary skills. Nine in ten (91%) of senior procurement professionals report struggling to find specific skills in new or prospective recruits, including skills in procurement strategy (46%), digital procurement (34%), and project management (33%).
“Our data suggests that the talent challenges facing procurement leaders are connected,” comments Price. “The demand for procurement skills is driving up salaries, which creates churn in the market. Yet when people move from job-to-job at speed, they don’t have the time – or even inclination – to build their skill set. This means that when skilled professionals leave the building, leaders really struggle to replace them. Those left behind suffer from increased workload – which takes us back to churn. The only way to break this skills loss cycle is to look beyond salary increases and adopt other retention tools.”
When asked what would make them stay at their organizations, 59% of junior professionals said progression opportunities – joint first with competitive salary (59%), feeling valued within my team, and the wider (53%) not far behind. What’s more, 81% agreed that they’d be more likely to stay at their if it offered more structured training relevant to their role.
“Procurement leaders are facing a two-pronged-talent challenge, but the above statistics point towards one key solution: excellence in training,” concludes Price. Junior professionals clearly want more training, but it will also make them feel valued and help them progress in their careers – which are evidently important factors in retention. What’s more, by training their own people, procurement leaders can ensure long-term access to the necessary skill sets.”
The data suggests that a number of procurement organizations are already reaching this realization. Over half (55%) of senior professionals anticipate the training budget for FY 23/24 increasing, on average, by 34.75%.
“It comes as very little surprise that training is increasingly a priority for busy procurement departments,” comments Sam Pemberton, CEO, Skill Dynamics. However, organizations must make sure that they are channeling their budget into the right areas and driving corporate outcomes through timely, expertly curated training. When asked about the type of training they’d like to receive, 53% of professionals said they appreciated access to personalized eLearning programs. People don’t have time to do unnecessary training. That’s why it’s imperative that organizations offer tailored programs that professionals can tap into when they want.”
Read the research.
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About Skill Dynamics
Skill Dynamics is a leading provider of digital procurement and supply chain training that offers high-impact continuous learning that’s personalized by role and skill level, and is delivered at scale.
Its industry beating content, innovative technology and cognitive science gives procurement and supply chain teams the real-world skills they need to excel, helping to accelerate performance and ensure their business is fit for the future.
About the Research
The report analyzes research findings from 200 supply chain and 200 procurement professionals across the UK and US in organisations with over 5,000 employees. Supply chain and procurement samples were split into junior and senior professionals (100 respondents in each category), with senior professionals being of middle, senior manager and director level and junior professionals junior manager level.
*This release uses data gleaned from the procurement segment of the above sample.