Selecting the right technology for procurement

This article is part of our ongoing series on digital procurement transformation. Previous articles explored the foundational steps organizations need to take when beginning a digital transformation journey:

• Part 1: Building the foundation — How to approach digital transformation, whether starting from scratch or with limited technology. 
• Part 2: Designing the transformation journey — Best practices for structuring a phased, strategic roadmap.

Now, we turn to selecting the right procurement technology, a clearly essential step for a successful digital initiatives. Choosing the right tools is not just about adopting the latest technological innovation; it is about ensuring that investments in technology align with procurement’s strategic goals, solve real business challenges and deliver measurable value.

In short, choosing the right tool focuses on a few key objectives:

• Assessing your current challenges and priorities.
• Starting small, i.e., focus on one module or tech solution.
• Doing your research, i.e., learning if past user implementations had positive outcomes.
• Clear ROI (is AI or a specific tech stack the best use of resources).

Key considerations and criteria for evaluating tech providers

Selecting procurement technology requires a structured approach to avoid the common pitfall of hype chasing. While technologies like AI and blockchain generate excitement, their practical impact depends on the organization’s needs and level of digital maturity. When selecting the right tool, it is important to consider whether the platform as a whole functions well, not just whether it includes certain technologies like AI. Websites and product demonstrations filled with AI jargon can cloud judgment, and many may not understand the difference between AI and other technologies with similar capabilities. In many cases, non-AI capabilities, such as rule-based workflows, are just as effective as the latest AI-driven tools, if not more so. Instead of prioritizing the newest features, procurement leaders must evaluate tools based on how well they address core objectives, such as cost optimization, risk management and operational efficiency.

So, an organization’s tech selection process should begin with a clear understanding of its procurement function’s current challenges and future priorities. Do not implement a solution purely for the sake of digitalization. It must serve a well-defined purpose, such as enhancing decision-making with better data analytics. 

Moreover, the solution should be tailored to the organization. Consider factors like industry, specific needs and company size. The tool should have experience working with or selling to companies like yours (or at least demonstrate the ability to do so). It is equally important to remain conscious of the people who support the technology you will be using. Determine if the provider can meet your desired level of strategic alignment.

Similarly, not every solution can handle every use case, meaning selecting a technology that caters to your context is critical. For example, if you work in the freight industry and are looking for an invoice solution, you need a specialized tool that can process complex freight invoices. This requires a solid understanding of both the product and the specific type of tool you need. Organizations should also ensure that solutions are scalable, integrate seamlessly with existing systems and support both immediate and long-term objectives.

Another important consideration is how well the tool’s functionality balances against the vendor’s performance. While features matter, they must be assessed alongside provider reputation, customer satisfaction and long-term viability. Reviewing case studies, requesting references and conducting thorough demonstrations help validate whether a solution can truly deliver the expected benefits. Moreover, procurement teams, especially larger organizations with complex needs, may consider running pilots or sandbox tests for large-scale implementations to ensure a practical fit.

Avoiding common pitfalls in tech selection

As you begin your tech selection process, be mindful of personal and organizational blind spots. Ask yourself these questions:

Are we neglecting any internal or external stakeholders in the conversation? 

One of the biggest mistakes organizations make is selecting technology without securing internal buy-in. In addition to external suppliers, procurement technology affects multiple stakeholders, including finance, IT and legal teams. Failing to involve these groups from the start can lead to misalignment and resistance during implementation. Early stakeholder engagement ensures that technology decisions reflect broader organizational needs and facilitates smoother adoption.

Is this technology too general, and if so, have we considered a best of breed? 

Another common pitfall is trying to do too much with one implementation. A phased approach is essential, beginning with foundational improvements, such as automating purchase orders or streamlining contract management, before advancing to more complex AI-driven capabilities. Many organizations also make the mistake of underestimating integration challenges. Procurement technology must work in harmony with existing ERP systems, finance platforms and supplier management tools to drive efficiency rather than creating new silos.

What is the full cost assessment over time?

Cost considerations should extend beyond initial pricing to include total cost of ownership. Many organizations overlook hidden costs, such as implementation fees, maintenance and integration expenses. A thorough cost-benefit analysis helps ensure that the selected solution delivers long-term value rather than just appearing cost-effective upfront. 

Does the vendor have robust customer service?

Organizations should evaluate vendor flexibility and support. Procurement needs evolve, and a rigid solution that cannot adapt to new business requirements can quickly become obsolete. Many providers claim they offer support, but there are levels to it; some only provide limited or one-time assistance rather than ongoing support. Consider how responsive the provider’s customer service team is. If you made a request, how long would it take for them to get back to you? Do you need personalized support, or will generic assistance suffice?

Will the company be able to tailor to our specific needs? 

Beyond customer service, think about the provider’s willingness to evolve with your needs. If you are not satisfied with certain capabilities or require a feature that does not exist, can its product team customize it or add it to their roadmap? Does the company genuinely care about customer feedback, and do they have proven examples or customer sentiments that show this? A provider that both offers continuous updates and demonstrates a commitment to listening and adapting is a good sign that the investment will remain relevant and scalable.

Steps to selecting procurement technology

Selecting procurement technology is a step-by-step process that moves from identifying needs to researching, evaluating and ultimately implementing the right solution. A structured approach ensures organizations make informed decisions that align with business goals and drive long-term value (Figure 1).

Figure 1

Selecting the right procurement technology is not about following trends. It is about making strategic decisions that align with business objectives. By focusing on capabilities over hype, taking an incremental approach to digital transformation and avoiding common pitfalls, organizations can ensure that their technology investments drive real value. Buying the right tools is especially critical for organizations adopting procurement technology for the first time. Because procurement technology often involves long-term contracts and significant investments, organizations must choose a tool that meets business needs from the start; otherwise, they risk a costly, disruptive transition later.

The Spend Matters TechMatch solution supports users with this tech selection journey. We look at your specific market characteristics/demographics and provide you with a short list of viable tech providers. TechMatch also helps identify providers that align with cost expectations to avoid promising solutions that are too expensive to implement or sustain.