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One surefire way to derail your procurement digital transformation

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WNS Denali Alpar Kamber, Head of Procurement Services, WNS (personal photo)

A large portion of our Procurement Services business at WNS Denali focuses on helping clients with their procurement digital transformation planning and implementation. Too often, we are required to spend time upfront unraveling past failed attempts before we can dig in and offer workable digital solutions for our clients.

Consider the case of a global retail company. Convinced that the key to their success was to find the right tool with the right functionality, they changed their digital toolset five times in five years. They tried the leading digital tools in the industry, but when one didn’t work, they immediately scrapped it for the next solution.

Why the constant change? Because they started on their digital transformation journey without a long-term strategy. Instead, they thought they could simply let the tool dictate their transformation agenda. When that approach didn’t yield the results they were looking for, they scheduled more demos with tech companies — hoping for a different outcome despite the same approach.

We see this type of tool churn often — procurement organizations swap out “bad” tools, or add modules and new functionality, but they continue to receive the same unsatisfactory outcome. In nearly all of these cases, the problem wasn’t the digital solutions they were using. The problem was a deeper one involving their operating model, processes and programmatic approach.

Digital tools are NOT a digital strategy

As this story illustrates, the most common surefire way to derail your procurement transformation is by confusing the digital tool or platform you are using with your digital strategy. I can’t emphasize this enough. Digital tools are only an enabler to optimize your people, processes and data that underpin any successful digital transformation. They are not, themselves, your digital strategy.

To achieve an impactful procurement digital transformation, you must first assess your procurement ecosystem, including the people, processes and data sets that make up your organization’s foundation — and break down the silos between them.

Rather than choosing complex functionality in digital tools at the onset, focus on absolute simplicity in the early days. Solve for the core adoptions, strengthen the ecosystem and, only then, introduce other complex uses.

Procurement people are more important than ever

Because I’m feeling generous today, I’ll also tell you the second most common way to derail your digital transformation: losing focus on your people and talent. In one example that may seem familiar to many, we worked with a large financial services company that planned to implement a digital system to help drive productivity. They bought the tool, implemented it themselves because they were told it would be turnkey, but only saw single-digit adoption. They came to us and said: “The technology provider said it was so easy to use. So, why aren’t people using this tool?”

Well, the tool was there, but the out-of-the-box training, lack of an established help desk protocol, and an underfunded engagement and communications plan had left the users entirely confused and unsupported. We established a special help desk, and it still took three years to achieve the productivity level promised in the business case.

People — your team, your users, your collaborators — are an integral part of the Procurement Ecosystem. You cannot ignore the impact that technology has on people. You must take stock and assess your talent by understanding who is best-suited for the different roles and opportunities that digital transformation offers. Like the above example, don’t assume everyone can jump in and learn the latest digital tool, even if the tool provider insists it is simple. Expect that a distributed adoption model will require plenty of support and handholding from the support team and plan for that. Or, better yet, consider centralizing the use of the digital tool within a core group initially before rolling it out more broadly. Don’t underestimate the power within your circle of influence to drive optimal results with your digital transformation.

In summary, if you are starting your procurement transformation journey with a tool-first mindset, you could be the subject of my next article on how to fail at digital transformation. Do yourself and your team a favor by reflecting on your overall roadmap and strategy with the help of our Digital Transformation Playbook. To make digital tools useful to the organization first requires a well-thought-out strategy and a talent-and-operating model optimized for achieving your organization’s larger objectives.

To read more on how you can improve your operating model with the right mindset and employ digital tools to enable procurement success, download the WNS Denali Procurement Pulse Check benchmark survey that is filled with insights and tips for achieving your priorities in 2021 and beyond.

 

Alpar Kamber is the Head of Procurement Services at WNS. He was the Founder and CEO of Denali Sourcing Services (now a part of WNS), a next-generation procurement services provider that enabled procurement organizations to influence more spend, and execute more effectively and efficiently. Prior to Denali, Alpar developed his cross-industry expertise in procurement value chain while in management positions at Ariba, FreeMarkets, Diamond Technology Partners and E&Y. He holds an MBA degree from the Tepper Business School of Carnegie Mellon University.

 

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