Transformation doesn’t happen overnight yet; things change in a small way, everyday. And so has procurement.
Zycus began Pulse of Procurement research series back in 2011 to comprehend enterprise procurement challenges and best practices around the globe. In this blog we want to have a look at how things have changed in procurement based on the Pulse 2011 and Pulse 2014 research reports.
When we started the research in 2011, the focus was on what high-performing procurement organizations do to win stakeholder compliance, participation and procurement technology adoption. With Pulse 2014, we are now able to look beyond current snapshots into emerging trends as enterprise strategic procurement functions continue to evolve and gain in maturity.
Let’s have a look at few aspects of procurement and how they have changed.
2011: Companies winning the highest technology adoption and user rates employed a combination of compulsory tactics — policy, usage monitoring, reporting, workflow management — along with ease of use (as a key solution- selection criteria), training, and ongoing mentoring.
2014: The tactics that were suggested by procurement execs to get higher user adoption rate are:
While the tactics have remained more or less the same, they have different weightage among the different user groups. (Check the Pulse 2014 report to view the weightage)
2011: Adopting a single solution extensively can engender compliance rates that exceed the industry average by some 25-33 points while extensively adopting an integrated set of solutions pushes the positive performance gap closer to 40 points
2014: With a vision of the future that includes integrated, predictive, synthesized and globally-scoped business intelligence, it is hardly surprising that procurement pros are apparently dissatisfied with their current overall technology profiles. 17% have Procurement suite, 33% expect it in the near future and 60% want integrated procurement suite.
While an integrated solution suite was always a preferred choice for the procurement executives, with changing business dynamics and increasing complexity, procurement technology suite is becoming more of necessity.
Contract compliance gains 14 points on average between 2011 and 2014. Despite being ranked as a top-three pain point by one in three procurement pros this year, the weighted average estimate for contract compliance has risen 14 points since 2011. What is more, the percentage of procurement pros placing their companies into one of the top two tiers for contract compliance jumped 11 points over the same time span.
Procurement is definitely moving in to a new phase. It needs integrated automation technology that:
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