Maganzani: “The Purchasing department, a value creation centre”

Pirelli's Chief Purchasing Officer, Andrea Maganzani, explains how the Purchasing department has evolved in recent years, what skills are needed for those who want to join the industry and the new challenges in a profoundly changing world

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What is the role of the purchasing department and how has it evolved over time?

The role of the purchasing department has traditionally been focused on cost optimisation and the correct set-up of the purchasing process. It actually buys goods and services to support all the company departments. For years, however, this role has been evolving in all international organisations, with the department becoming more strategic and becoming an extraordinarily important department today. A shift is under way, from a simple concept of cost reduction to a concept of purchasing to create profit and value: it is no longer just a negotiating approach, but an effective optimisation of costs on the basis of the goals that the company wants to achieve. The change goes from answering the question “How much does it cost?” to “What does it do?”. The department's response thus evolves, through cost optimisation according to the service we want to achieve through the most reliable, experienced, innovative, sustainable and efficient delivery channels.

Maganzani: “The Purchasing department, a value creation centre”
Maganzani: “The Purchasing department, a value creation centre”

What are the main challenges and opportunities this department will face in current and future scenarios?

The biggest challenge we have to overcome is called “risk,” in a world that has changed and is changing profoundly. We are emerging from the Covid pandemic, in the midst of a conflict between Russia and the Ukraine, the economic scenario is hyperinflation, we are facing gas shortages and an explosion in energy costs. And the unexpected surprise is just around the corner: just think what happened in the supply chain when a container ship became stuck in the Suez Canal. We were used to a world that was moving rapidly toward ever-increasing globalisation and now the paradigms have changed and we are starting to think on a local scale and on a regionalisation of relations, with different challenges within each region. This has given rise to challenges and opportunities.

How do you embrace this change and shape it into an opportunity?

We need to focus on a highly skilled fleet of suppliers with whom to activate closer connections that allow us to navigate the storm and set down our roots for the future. At the same time, we need to be smart and collaborate with increasing agility, making the most of the strong skills within the company and the ability to work in a cross-departmental and global way. Winning the game of risk identification and mitigation in a sustainable innovation path with our reference suppliers becomes a competitive advantage in such a complex context. And it is through a virtuous path of sustainability and innovation that, in addition to supply competitiveness, the purchasing department becomes a central stakeholder for the company.

What are the effects of digitisation and what opportunities can be drawn from it?

Understanding, comprehending and using the vast amount of data we have is also a task for the Purchasing department. Big data is very important in our industry and we need to bring on board people, perhaps not with direct procurement experience, but who are capable of reading these data, get value out of the information to put together a summary. It is a great challenge and, at the same time, an opportunity that we must seize to ensure that we are ever stronger and that decisions are made faster in an increasingly complex world.

What skills do you consider to be critical if you want to embark upon a career in Procurement?

In such a volatile and complex environment, some key features are needed: first of all, curiosity and malleability, i.e. being able to think differently and face a changing world, which involves agility and speed of thought, as well as a good resilience that helps you never give up when the circumstances seem adverse. And then the ability to work as a team and with passion for what you do. Individual work is a thing of the past, these days it is essential to be able to work as a team with stakeholders, regions, headquarters, but also with the suppliers themselves. In addition, as already mentioned, digital skills are becoming increasingly essential. 

What was your path to this role?

I have a purchasing background in the automotive and consumer electronics industry, where I was the global head of raw materials. As an avid fan of Motorsport and competitions, for me Pirelli has been a great opportunity, which I gladly and enthusiastically accepted in order to grow my purchasing experience.