In this second part on 2014’s procurement trends, we look at the aspects of innovation, analytics, and emerging technologies.
Trend 3: Making the impossible possible
Technology innovations such as small scale manufacturing (3D and 4D printing) are moving production closer to markets and enabling mass customization. Rising labor costs and global access to online talent and knowledge mean that supply networks will need to be mobile and flexible to cope with the changing business requirements.
Procurement will need to meet this by being innovative in their day-to-day activities. This will need to be achieved through increased collaboration with strategic suppliers who can provide the insights, the know-how, and the technology to drive innovation. GEP has assisted several clients to drive innovation and joint improvement projects with suppliers through our proprietary WISE workshops and Category Innovation Cube framework.
Trend 4: Manage the information explosion
2013 saw the continued rise of the social media and analytics field. “Big data” is increasingly transforming from a mere buzzword into an integral part of any organization’s strategic analysis. We expect this trend to continue in 2014. While there has been an increased adaptation of big data analytics in marketing and CRM areas, procurement is slowly but surely catching up.
We expect procurement professionals to use big data analytics more and more to track supply risks, commodity price and capacity trends, and swings in demand affecting supply patterns. GEP has a team of market intelligence experts working with several global clients to equip their procurement teams with the tools required to take advantage of the glut of information available and use them to make strategic decisions.
Trend 5: Be smart about mobile tools
The number of Internet-connected devices has reached 12 billion – more than the number of people on the planet! Payments by mobile phones are hurtling towards the $1 trillion mark. Social technologies are much more than a consumer phenomenon: they connect many organizations internally and increasingly reach outside their borders. Now it has become the environment in which more and more business is conducted. Many organizations increasingly rely on distributed problem solving, tapping the brainpower of customers and experts from within and outside the company for breakthrough thinking.
This trend will be replicated in procurement tools too. We see 2014 as the year in which the procurement technology will provide multiple inter-linked applications that will also be easily extensible and accessible through a variety of platforms, including mobile ones. For example, our own Smart by GEP provides complete, unified sourcing, and procurement platform native to cloud, touch, and mobile technologies.