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Procurement is Evolving: The Need for Change Is Now

Procurement is Evolving
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Many years ago it was often said that in its primary role of interacting with suppliers, procurement worked on the ‘front lines’ of the business. But, while procurement continues to interact with suppliers, it has expanded its role dramatically over the past several decades, from being clerical to being strategic.

 Procurement has moved to the very heart of high performing businesses and this move has brought with it the areas where procurement can make a strategic impact. High performing businesses have certain strategic imperatives that need to be achieved to excel in today’s competitive and volatile business environment.

Contemporary procurement professionals are extensively collaborating throughout their business organizations and supply networks and are also leveraging technology in the areas of spend analysis, strategic sourcing, supplier management, contract management, financial savings management and procure-to-pay, to drive competitive performance along many of these strategic imperatives. By effectively contributing in key strategic areas, procurement has transformed itself as a key element of business performance within organizations across globe.

To become a driver in strategic business initiative, procurement needs to connect the isolated dots to achieve the complete transformation picture. Procurement professionals realize this and many organizations have already put processes in place to actualize this transition. Automation has always stood at the forefront of any procurement transformation project, but whether the technological capabilities available have been harnessed to their optimum potential to achieve tangible benefits is a question best left unanswered.

 Leveraging the right technology

Discrete automated solutions implemented in isolation more often than not don’t achieve anything but a marginal increase in operational efficiency. The Holy Grail for any procurement transformation project is an integrated system whereby automated solutions in the entire procurement cycle from market analysis of suppliers to the final purchase order creation are brought together in a seamless workflow to achieve organizational strategic goals.

Industry experts as well as procurement professionals unequivocally accept that the necessary transformation of procurement processes can be achieved only if there is a shift to automated systems. Operational activities have to be completely transferred to automated systems to enable procurement to focus on strategy driven activities. Ensuring automation of processes like sourcing of commodities to the right suppliers, ensuring compliance to contracts, managing suppliers and enhancing visibility into organizational spend is the backbone of any transformation initiative which hopes to be more than window dressing.

Leveraging correct technology will not only help procurement in maximizing efficiency in current scenarios but also build a robust procurement infrastructure to deal with future uncertainties.

Related Read:

  1. Blog – Procurement Risk Management: A Cognitive Data Driven Approach
  2. Blog – Procurement today and tomorrow – Transformative Scenarios for Change part – 2
  3. Zycus e Procurement Software
  4. Research Report – Procurement Benchmarking: Analyzing the Cost of Procurement as a Percentage of Spend
  5. White Paper – Procurement Leadership in the Digital Age: Redefining Technology, Agility and Adaptability
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