‘To Boldly Go’ Where No Procurement Professional Has Gone Before

We are delighted to publish this guest post from Daniel Ball, Director, Wax Digital, discussing innovation in procurement technology, which will be published in two parts.

Procurement professionals have become drivers and passionate adopters of new technologies. Where sourcing a new product, raising a requisition and negotiating with a supplier was once a laborious process, eSourcing and purchase-to-pay solutions have enabled procurement teams to accelerate and manage the buying cycle by automating administrative tasks. This frees up both their own time and that of their colleagues in other departments to concentrate on the increasingly thought-intensive and strategic roles being demanded of them.

As a result the procurement profession during the past 20 years has transformed from a predominantly administrative function to one of a business’s most valued strategic authorities. There is a central role for technology platforms to enable businesses to drive cost savings, gain enhanced visibility of organisational spend, improve supplier selection and minimise risk. But since modern procurement looks beyond just cost savings as it seeks to nurture long-term supplier relationships, it’s time also for organisations to explore how new innovations could be game changers for the efficiency and effectiveness of procurement in the future.

In this article I will consider how four emerging technologies of today are set to revolutionise procurement and corporate buying in the 21st century. The first two are covered here today. Look out for the next two, Wearable Technology and Online Search Technology, to follow shortly in  “To boldly go where no procurement professional has gone before, Part 2.”

The Internet of Things

The Internet of Things (IoT) is a fast-growing phenomenon where internet-enabled devices ‘talk’ seamlessly to other web-enabled systems so that data from any products can be captured, communicated and analysed. Predicted by Gartner to reach 26 billion devices by 2020 (up from 900 million five years ago) the IoT is set to revolutionise how organisations work together throughout the supply chain.

In contrast to making business decisions based on intuition alone, procurement technologies have introduced streamlined processes and predictive modelling of the supply chain to enable purchasing teams to make sound judgements based on historical data. By directly connecting people, devices and back-office systems, the IoT could take a giant leap forward enabling supply chains to make informed decisions based on ‘what is happening right now.’ In addition to increasing supply chain efficiency, the IoT, according to Gartner, will allow organisations to deliver differentiated service offerings to their customers through greater procurement visibility and insight.

Collaboration technology

As procurement shifts its emphasis from managing categories to managing supplier relationships, as well as aiming to work more closely across the business, increasing collaboration is understandably at the top of many procurement professionals’ agendas this year.

From a strategic sourcing perspective sometimes the greatest savings can be discovered in the most complex categories of an organisation’s spend. However, these savings are invariably harder to realise as overstretched procurement teams struggle to find the time to focus on enforcing compliant, on-contract spend for these areas. Usually the answers lie within organisations, which has led to a greater emphasis being placed on businesses improving collaboration between internal teams to realise business objectives and efficiency savings. If you’re sourcing a particular category, for example marketing services, the need to collaborate with internal marketing stakeholders makes logical sense - but what is often missing is an efficient and effective means of supporting this process.

Collaborative features within a procurement platform eliminate confusing email trails by pushing messages out to all subscribers in an orderly manner, which make it easier to run sourcing events and maintain a complete and accurate audit trail over who said what and when. Furthermore, bringing together buyers and suppliers is where collaboration technology really comes into its own. This enables category managers to collaborate effectively with suppliers in an open forum to more easily determine where greater cost savings could be achieved, consider new innovations or changes to operating procedures.

As businesses place a greater focus on collaboration to support their strategic objectives, the next generation of collaborative platforms will seamlessly integrate into existing back-office systems, such as ERP and CRM, along with external social media sources and mobile devices. By making status updates, automated activity streams, tweets and document sharing more accessible, integrated collaborative technologies will provide buyers and suppliers with a platform to make their relationships more profitable. Future functionality enhancements will include integrated voice technology and powerful social analytics to further drive user experience and adoption.

First Voice

  1. Nick @ Market Dojo:

    Great concepts. We integrated our eSourcing tool with our CRM a few years ago and it has been a huge benefit. Every registration on the sourcing tool is passed into our CRM contacts ready for any future conversation, task, note or otherwise to be recorded. Our CRM also integrates with our support portal and community forum with single-sign-on with the sourcing tool so all the data flows seamlessly across the various solutions. Internet of things is certainly the way forward, linking different SaaS solutions back to a single point of reference so you can increase capability without compromising data integrity.

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