Procurement Certification: What Are the Options?

There is a bewildering amount of choice in today’s market for training, education, and certification.

Many who labor within the supply chain eventually come to a watershed moment in their career: they ask themselves, “Am I passionate about this line of work? Do I see a future for me within SCM?”

These questions might even take the form expressed by the truly committed: “Do I want to up my game from being a regular  employee, to becoming a professional?”

If the answer to these questions are “yes,” seekers will start a journey to determine what education and training is available that will assist them in achieving their goal of becoming a “professional.” They might also seek those certifications that will endorse their level of expertise. In their search, they might ask the following questions, among others:

- does this institute of higher learning offer a high-quality program?

- is it well-recognized in my chosen industry?

- is the program relevant to my chosen field of work?

- will it teach me what I need to know to perform my job better?

- will it help me to advance my career, get promoted, or improve my resume?

- will this investment in time and money lead to higher compensation?

I went through this process more than once in my career. Before settling on APICS as my primary education provider, and CPIM as my chosen professional accreditation, I had considered earning a professional designation in accounting, and actually traveled that path for a while.  It was not at all a waste of time, as higher-than-average knowledge of accounting can be very useful when  working in SCM.

Supply Chain Management is a unique field of study, by virtue of the fact that it is very difficult to define unambiguously. SCM might contain logistics, inventory management, manufacturing, IT, procurement / purchasing, quality control, and many other disciplines. See the wonderful video series titled “What is Supply Chain Management?” produced by Arizona State University in the Videos section of this web site to gain a better appreciation of the scope of the discipline.

Consequently, it is important that the seeker focus upon those educational service providers who have a great reputation not just for SCM in general, but for the seeker’s chosen field of practice. APICS, for example, is almost unsurpassed in its knowledge of manufacturing Best Practices and inventory management. Since my field of professional concentration was inventory management twenty years ago, I chose to be affiliated with APICS.

In Canada, CITT is recognized as an authority on logistics and transportation. I would have no hesitation approaching CITT is that would have been by area of interest. PMAC is an authority in the field of Purchasing in Canada, and I have great respect for those buyers who have earned their CPP designation.

But, to enrol in the CITT course in hopes of becoming an expert in manufacturing Best Practices might have been a mistake.

Once the seeker is able to align his or her education provider with his/her career interest, the seeker is ready to commit. His/her status changes from “seeker” to “candidate.”

The sources quoted in the balance of this article focus upon the discipline of procurement, and specifically on purchasing / procurement training and education in the USA. However, many of the principles and findings revealed are relevant to any person who seeks knowledge improvement. So I encourage you to press on.

In 2008, Spend Matters published a terrific study titled “What is Your Best Option? Procurement Certification and Training Today.” Spend Matters followed up with a series of articles by Jason Busch published in late June of this year (2012). They offer considerable insight.

The October 2008 document, accessible by clicking here, focuses upon US-based certifying authorities, including the world-famous Institute of Supply Management (ISM), a relative newcomer to the field of procurement education and training called Next Level Purchasing (which is structured as a for-profit organization), and the American Purchasing Society.

While it is a little dated, the article is worth a read. It discusses the various certifications available to procurement professionals, costs, and benefits. It also discusses programs that are available through universities and colleges. Importantly, it also talks to the question that is top of mind for many people and employers: “What is my ROI? If I invest $x in certification and training, what might my expected return be in terms of either compensation or increased productivity?”

There might not be an adequate answer to the ROI question. While compensation tends to vary directly with an individual’s level of training and education, much of that relationship might have more to do with that individual’s work ethic, sense of commitment, and willingness to learn than it does to the letters behind one’s name. People who seek out avenues to continuous personal improvement tend to be those same people who work harder, embrace best practices, and encourage innovation. Interesting perspective.

Spend Matters provides the following introduction to the October 2008 publication:

Across industries, procurement skills are falling short of what organizations need. In survey after survey, hiring managers cite a lack of qualified candidates as one of the top challenges they face. Spend Matters research suggests that fewer than 10% of the procurement workforce in North America has a procurement certification or has gone through a formal degree program in supply management or a related field (e.g., operations research, supply chain management, etc.). Part of the challenge is that training and certifying authorities historically received mixed reviews from members. But fortunately, in the past few years, training, certification and educational opportunities have changed tremendously for the better. Indeed, today’s procurement professionals not only have more training options at their disposal – they have better ones as well.

This Spend Matters Perspective will provide succinct analysis of some of the training and certification programs that procurement and sourcing professionals now have available to them. Based on interviews with a range of practitioners, it includes profiles and analyses of the certification programs offered by the Institute of Supply Management (including the new CPSM certification), Next Level Purchasing (SPSM) and the American Purchasing Society (CPP, CPPM). The study also investigates executive education programs and other options (e.g., online training courses from consulting providers). Last, the report examines the relative cost/benefits of these options and evaluates the general value of pursuing different types of training and certification initiatives as well as the specific skill sets that individuals can gain from each program.

Starting on June 20, 2012, Jason Busch from Spend Matters began publishing a four-part series that followed up on the 2008 publication. There is considerable focus on the progress of Next Level Purchasing relative to its competitors, ISM and APS.

In Part 1, Busch discusses the developments that have occurred in the industry since 2008, and the acceptance of NLP’s SPSM accreditation relative to ISM’s newly crafted CPSM certification. Both contain considerable benefits: ISM in terms of recognition and quality of content, and NLP in terms of flexibility, responsiveness, and speed of delivery. Writes Busch:

In the US, I personally don’t believe the SPSM/SPSM2 holds a candle to the CPSM in terms of prestige — despite the fact the combination of the SPSM and SPSM2 offers a really solid foundation in the knowledge base required for a typical procurement buyer, manager and executive today. Our research over the years has shown that those who know both programs and in fact, think they each have their strengths and are worthwhile endeavors to pursue individually and together. For those who need to come up to speed quickly on procurement, the SPSM/SPSM2 may be the preferred route. Read more of Part 1 by clicking here…

In Part 2 of the series, published on June 26, Busch continues his evaluation, discusses demographic and membership issues, and dives into the issue of Return on Investment (ROI):

…Yet passing the SPSM and SPSM2 is not a walk in the procurement park. 68% and 60% pass, respectively, on their first attempt. These numbers rise to 80% or higher for subsequent attempts. Clearly this is not a CFA-like certification process that’s taking place over three years in which Harvard MBAs still fail. But it’s not like applying for Who’s-Who and writing a check, either. From a salary perspective, NLP’s own research suggests that those who hold the SPSM certification earn $21,151 more per year than those who do not have a purchasing certification (and those who hold the SPSM certification, by NLP’s own data, earn $16,942 more per year than those who have earned a purchasing certification other than the SPSM). We would suspect similar or higher numbers from other certifying authorities in the sector for a number of reasons:

• Those applying for certifications tend to be more motivated (on the individual basis) than those who do not, in terms of both career progression and pragmatic learning to drive greater on-the-job effectiveness
• Employers willing to invest in certifications are likely to place a greater emphasis on attracting and rewarding talent that is stronger than average
• Any type of designation with at least a modest reputation, especially for more junior buyers, analysts and managers without an advanced and/or four-year degree, is likely to help them stand out from peers in an industry where certification penetration is still very low (especially relative, for example, to the CPA designation)

Read more of Part 2 of Jason Busch’s series on Procurement Certification by clicking here…

Part 3 of the series, dated June 28, 2012, discusses who might be the best “fit” for NLP certification, and contains a “final word” on compensation. Busch concludes:

There is no one-size-fits-all approach to training and education in the procurement area. We believe (contrary to the certifying authorities) that it is important to separate the relationship between training and career progression/salary growth

Part 3 of the series may be accessed by clicking here…

In Part 4, dated July 2, 2012, Busch comes to some very refreshing, objective, and common sense conclusions. Some might be viewed as surprising to providers of training and education providers:

All certification holders voiced strong support for the SPSM certification from a time/cost/value perspective. Others cited the pragmatic training (e.g., how to use Excel in a procurement environment) provided a useful foundation that they easily applied across their job function. International students studying for the SPSM like the fact that the entire coursework and testing is done online. This could potentially lead to broader global recognition of the SPSM brand as growing numbers of international practitioners undertake NLP’s course of study.

…

The quality and foundational base of SPSM’s course of study surprised many of the graduates we interviewed. For them, the certification was far more valuable from an applied knowledge standpoint than the CPM. Unfortunately, it is difficult to draw a comparison between the SPSM and the CPSM given we did not speak to anyone who held both certifications. Our own cursory investigation suggests that the curriculum is actually quite similar.

However, given the reach and breadth of ISM, we hypothesized in 2008 that the CPSM certification would ultimately become better known among companies whose procurement team members actively participate in ISM and related groups (e.g., CAPS Research). We believe this cursory analysis proved correct in the past few years, as among Fortune 500 companies, we believe there is much greater brand affinity/association for the CPSM certification than the SPSM (this is not a scientific analysis, but is based on the daily interactions we have with procurement managers and executives).

…

Still, certifications are not essential in procurement (unlike accounting and financial analysis, where they are almost ubiquitous among those who progress in the field). The now thousands of interviews that the Spend Matters team has conducted with procurement executives in the past decade suggests that advanced degrees in the procurement or supply chain areas are not necessary to rise to the top of the profession. For example, MBAs and engineering graduate degrees can provide a just as effective — when supplemented by additional on-the-job experience and outside training — knowledge base and career growth platform as a specific procurement or supply chain academic degree.

Read more of Part 4 of Jason Busch’s series on Procurement Certification by clicking here…

Additional Resources:

Next Level Purchasing‘s site may be found by clicking here…

Information on ISM’s CPSM program may be found by clicking here…

The American Purchasing Society’s web site may be found here…

Information on the PMAC’s SCMP program in Canada may be found by clicking here…

Canada’s CITT web site may be found by clicking here…

Information about APICS’s CPIM program may be accessed by clicking here… 

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