"Savings is completely self-invented and pointless because it's separated from the real P&L."

This assessment from Bayer Chief Procurement Officer Thomas Udesen captures the essence of what may be procurement's most radical transformation in decades.

In this episode of "Buy: The Way...To Purposeful Procurement," Thomas joins Philip Ideson and Rich Ham to discuss how one of the world's largest pharmaceutical companies abandoned traditional procurement metrics entirely, replacing "savings" with six C's that actually drive business outcomes: cost, cash, carbon, community, compliance, and continuity.

Thomas's approach defies conventional wisdom at every turn.

At Bayer, every employee can spend up to €50,000 without pre-approval – a level of transactional autonomy that would terrify most procurement organizations. Yet the results speak for themselves: increased responsibility, entrepreneurial thinking, and more strategic spend management decisions driven by transparency rather than control.

The conversation reveals how procurement's obsession with "savings" has become a self-inflicted wound. Stakeholders roll their eyes when procurement leads with savings slides because the metrics mean nothing to them. Instead, Bayer measures real P&L impact through price index benchmarking and spend ratios that directly correlate to competitive performance.

In this episode, Thomas demonstrates that purposeful procurement isn't just theoretical; it's already happening. His parting challenge: procurement can be "the heartbeat of the change that is coming."

Links:

BTW EP 16: Lightbulb Moments: Shedding Light on Purposeful & Productive Procurement

Art of Procurement