Procurement in a Digitised World – Basware Dinner Discussion Ponders the Future

A couple of weeks back, a group of CPOs came together under the Alchemy Club banner at a very pleasant dinner at the Covent Garden Hotel, a very pleasant and pretty hip place in … well, you can probably work that out! It was hosted by our friends at Basware, leading P2P, invoicing and payments solution providers.

I led the debate around the topic of the changing role of the CPO in a post-digitised procurement world. There were a couple of old friends amongst the CPO attendees, plus some new faces (to me) who all turned out to be interesting and forward-thinking people.

My opening remarks touched on how technology is changing and will change further the activities that we currently call “procurement”. Increasingly, we can see where this is leading, in some areas at least. eInvoicing is a given, I believe, and it is surely only a matter of time really before we have 100% coverage in that area. The whole purchase-to-pay cycle is increasingly automated and that will go further, using robotic process automation to remove more of the human interventions.

Similarly, we can see how end users will be more empowered to carry out sourcing work themselves, using catalogues and guided buying, and perhaps running simple RFPs, with the help of AI to hand-hold them through the process, suggest options, provide templates and so on.

More than one of the CPOs present that evening mentioned their own moves to “use technology to replace all repetitive tasks”. So, while there are still some gaps in the vision, and no doubt some new angles that will emerge, we can see where this is heading.

However, procurement at an organisational level will still be about getting external markets and suppliers to contribute as much as possible to the organisation’s goals and competitive advantage.  Now there is a common assumption in procurement circles that automation will “free up procurement do more value-adding work”. But is it as simple as that?

That took us on in the discussion to the future role of the CPO, and what his or her “function” might actually be doing in five years’ time in an increasingly digitised world. The discussion moved on to areas such as governance – someone still has to define the environment, not just in terms of internal spend policy (and systems) but also external and supplier-facing policies around CSR-type issues, for example.

That led into interesting comments around the opportunity for CPOs to share more information across organisations and collaborate (in areas that aren’t core competitive advantage of course), but could bring considerable efficiencies to both buy and sell side – around onboarding suppliers, or auditing and compliance activities in the supply chain. That’s a major topic in itself we should come back to soon.

There was more, particularly around procurement of complex services, and whether that becomes the heartland of the future procurement function, but we’ll leave the discussion for the moment. Basware may publish more detail on the evening’s outputs, in which case we will let you know. And watch out here for much more on “the Future of Procurement” coming in the next few weeks – stay tuned for that!

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