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New Year Insights for the procurement solutions and services marketplace 2024: Amazon Business

01/12/2024 By

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Spend Matters is publishing a series of articles about procurement, supply and services trends for the year ahead from expert tech and service providers in the market.

We are highlighting the customer demands, market movements and advances in procurement tech that are exciting the world of solution providers, how they expect them to shape the S2P landscape next year and how they plan to respond to them.

Our series runs from mid-December to mid-January, then our senior analysts will wrap up with their own take on the key themes that emerge.

In no order of preference, other than by the date they arrived in our inbox, today let’s hear from Amazon Business.

Procurement priorities will shift as budgets increase

Driven by expected budget increases in 2024, procurement teams globally will make a dramatic shift in how they spend their time, placing an added emphasis on pursuing ESG goals. Already, the vast majority of procurement functions have mandates in place for certain kinds of certified purchasing, including half with sustainability mandates, but in 2024 those mandates will become commonplace and top priorities for procurement teams around the globe.

Additionally, there will be more time spent investing, retaining and developing talent by offering more training and guarding against economic uncertainties caused by supply chain disruption and inflation. In fact, more than 80% of those surveyed across the US, Asia and Europe in the Amazon Business 2024 State of Procurement report stated retaining and developing talent was a top priority, and we don’t see that changing — Aster Angagaw, VP, Head of Strategic and Public Sectors Amazon Business.

Procurement teams will start working closer with other parts of the business

Given complexity and an uncertain business climate due to supply chain disruption and inflation, procurement decision makers across the globe see room for other parts of their organizations to improve their purchasing compliance. In 2024, this cross-team coordination with procurement will drastically increase to achieve better cost reductions, savings and ROI on a global scale.

Key to that process will be procurement leveraging its risk-reduction capabilities, exemplified by the 35% of senior leadership committing to focus more on mitigating risks from economic and geopolitical challenges, per global decision makers and senior management surveyed in the 2024 Amazon Business State of Procurement Report. Without this closer collaboration between procurement and other parts of the business, organizations will run the risk of a misused procurement function – and mismanaged cost reductions — Alex Gagnon, Vice President, Amazon Business WW.

Procurement teams will embrace the AI wave

As AI tools become more prominent and accessible in 2024, organizations will invest in analytics and insights tools, automation and AI-driven optimization of purchasing decisions to improve efficiency. In our Amazon Business State of Procurement report, 98% of decision makers globally are already planning investments or upgrades in analytics and insights tools, automation and AI-driven optimization of purchasing decisions in the next few years. The same amount are interested in discovering or learning about new digital tools that could scale up their procurement operations.

These investments will not only reduce manual work and allow departments to spend less time on tasks that can be consolidated or automated, but it will also reduce spending, streamline processes and ensure organizations meet employee and stakeholder needs — Doug Gray, Chief Technology Officer, Amazon Business

Read our senior analyst’s take on the key themes from the series here.

Access Spend Matters dedicated ‘Artificial Intelligence in Procurement’ page for more AI insights.

If you need to find the right procurement technology provider or service for your business needs next year, try Spend Matters TechMatch for a free rapid shortlist.

For granular analysis and comparisons of procurement technology solutions, subscribe to Spend Matters Insider.

As always, reach out to discover how Spend Matters can help with your new year commitments and wishes.

Series
Insights 2024