A 5-Point Digital Procurement Checklist for your Company
A daredevil wheelchair-bound Jack Reynolds startled the world with his zip wire ride at 106! and that too live on camera. How phenomenal is that? Such is the importance of having a checklist that you diligently pursue to realize the ultimate goal, whether in life or business. In the business of procurement the way the landscape is evolving so fast, it is like a time-lapse that you can capture with automation and analytics.
“Procurement organizations that use automation and analytics technologies effectively see a 54% increase in visibility, 47% increase in execution speed, 37% increase in spend compliance, and 21% increase in savings rate” Gartner.
In the Industry 4.0 business environment, procurement has plenty of opportunities to illustrate its value within an organization as a trusted business advisor and strategic partner. Besides increased productivity and greater savings, procurement can now harness the transformative power of digital capabilities offering advanced data and analytics to build new business models, help businesses run lean, be agile and responsive to customers and stakeholders. Overall, procurement can take that giant leap from the well to the sea and establish itself as a strategic instrument impacting its organization’s overall competitiveness and performance.
Benefits of Digital Procurement
Here’s a table for your quick reference. To read the complete list of benefits, download the whitepaper.
To realize the benefits of digital procurement, the leap from manual to digital is essential. The transformation is possible when an organization endeavours to implement these-
FIVE KEY ELEMENTS OF PROCUREMENT TRANSFORMATION
Data is the staple for digital transformation. From predicting the needs of people to identifying which goods and services are available and who are the best suppliers and to select the best price, data is indispensable. Having said so, many procurement companies are heavily dependent on transaction information or line-item data which is not enough.🔒
While futuristic technologies like AI, natural language processing, analytics, and bots continue to evolve, wait not any longer in deploying simpler technologies such as process automation, SaaS products, integration etc. that can help facilitate a wide range of activities and processes through advanced intelligent reporting. 🔒
To reap maximum benefits of digital procurement, user experience has to be crafted as attractive, and intuitive as possible. This will be inviting for the stakeholders to explore maximum digital capabilities; their effectiveness in buying and generating useful data will be indispensable. For example take the kind of experience delivered by Amazon.com, Inc or HomeAdvisor where a single dashboard serves 🔒
Besides data, technology, and user-friendly innovative design, another key element to the success of digital procurement is a cross-functional team of people with distinct skillset. Your employee base must constitute data scientists and AI experts who can suitably play with various data models 🔒
Policies, Procedures & Operating Models
From internal stakeholders of a company to its employees and suppliers, digital procurement creates a unanimous platform for all. This enables superior collaboration and interaction along with access to data that is robust and insightful. For a procurement organization to harness the maximum of this transformation, it should review its policies, procedures and operating models. 🔒
A Hackett Group research report, titled “The CPO Agenda: Keeping Pace with and Enabling Enterprise-Level Digital Transformation,” surveyed executives at 180 large companies in the US and overseas – the majority with annual revenue of $1 billion or more. The research found that a mere 32 percent of procurement organizations have implemented a digital strategy – and only 25 percent have the requisite skills and resources. This is in sharp contrast to the study’s findings that nearly 85 percent of all procurement organizations believe that digital transformation will fundamentally change the way they deliver services over the next three to five years. This goes on to support how digital transformation is expanding performance opportunities. From organization culture to information technology, through to governance modalities and supplier relationships, digital procurement is the wave to last and disrupt whatever is manual, repetitive, and impedes the ROI. Sooner the journey is begun, the more profitable will be the whole business pursuit of staying relevant and industry ready.
🔒This is a limited preview of the whitepaper that you may download here.