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My Q&A on Procurement Certification for "Trusted Magazine" (April 2023)

My Q&A On Procurement Certification For "Trusted Magazine" (April 2023)
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Why are so many colleagues not pursuing professional procurement certification?

As a Fellow of CIPS (FCIPS), I’m asking this question to sense-check my earlier decision to become a member of CIPS (MCIPS), then a Fellow, and then a Direct Associate (a Tutor). 

The answer may reside in the job market. I asked Chat GPT to provide a generic assessment across 1,000 procurement job ads and define the portion of those requiring professional certification.

The following result may not be 100% correct statistically, but it coincides with my “gut feeling”—not more than 40% of new positions require professional certification. In most ads, such certification is a nice-to-have requirement; perhaps only 10-15% of ads make it mandatory. 

This observation assumes that most employers are prepared to delegate spending budgets to people who can demonstrate relevant experience and skills but may lack an appropriate educational background. This article investigates the potential root causes of such a situation. It represents the author's subjective view and does not pretend to provide precise answers. 

In his conclusions, the author will employ some familiar economic theories to be considered less subjective. 

Information asymmetry 

The employers and potential candidates represent the classical situation of information asymmetry, where one party in a transaction has more knowledge than the other. This creates an imbalance of power that can lead to inefficiencies or unfair outcomes.  

Indeed, firms may only guess as to the true capabilities and virtues of their prospective employees.  

To mitigate the risks of information asymmetry, employers conduct a thorough screening process, where another exciting but controversial theory can be applied – the theory of signaling. 

Signaling Theory  

This theory suggests that education and professional certifications act as signals to employers about a job seeker's qualifications.  

Firms can only easily recognize the more productive workers by hiring them and finding post-factum, leading to residual risks and costs and increased attrition. 

Signaling theory says that, in pursuing more education, people who know they are more capable thereby send a signal to potential employers that they are the more capable workers. 

This post first appeared on The Good Spending, please read the originial post: here

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My Q&A on Procurement Certification for "Trusted Magazine" (April 2023)