Procurement In The Lead: Capitalising on Your Increased Visibility
by Des Nnochiri for WBR UK, May 3, 2021
Over the past twelve months, many businesses have had to act with agility and flexibility in order to keep their essential operations going, in the light of radical supply chain disruptions due to the COVID-19 pandemic. Once crisis management brought relative stability, they had to pivot again as they adapted to new trading conditions or changing customer needs.
Throughout this period, procurement leaders have been right at the heart, helping to deliver business continuity while navigating change, and carefully managing costs. As organisations move into the recovery phase post-crisis, procurement is also at the forefront taking the lead in three key areas:
1. Investing In Innovation
CPOs are continuing to shift towards digital, and leveraging the rich data insights that this can offer them, and extracting business-critical value. Our research amongst CPOs reveals that 80% said that the COVID-19 pandemic had not negatively affected their digital innovation strategy. In the payments space particularly, we’re seeing businesses increasingly explore the ways in which digitising payments processes, such as supplier payments, can deliver long-term value for their operations.
2. Agility Through Data
Good quality digital data is helping procurement teams identify ways to quickly evolve their activities. Some of the key metrics they’re using to check the health of their procurement processes include cost, quality, compliance and time. However, a lack of data literacy among procurement employees and across their organisations is the most challenging area when it comes to managing supply chain data within the business.
Providers and suppliers who can help bring insights to the table that enable procurement professionals to make smart, evidence-based decisions – often in real time – will be looked upon more favourably. This is especially true in regard to spending insights and payment trends.
3. Strengthening Supplier Relationships
Over the last year, many businesses have shifted spend as they move marketing efforts to where their customers are (e.g., online), and away from other traditional channels. Understanding these trends will enable procurement leaders to identify areas for saving costs, automating work, or making more strategic buys.
Many procurement professionals are helping to manage their business recovery by strengthening and deepening their relationships with suppliers -- many of whom may be new partners. To establish and maintain strategic, collaborative supplier relationships, CPOs need streamlined, digitally focused payment processes.
Reimagining Your Digital Innovation Strategy To Add Strategic Value
Digital innovation has allowed procurement managers to manage supplier risk proactively, automate transactional procurement, and apply predictive analytics to strategic sourcing. In what is now a highly strategic function, procurement professionals now embrace and leverage technologies like Artificial Intelligence (AI), the Internet of Things (IoT), Robotic Process Automation (RPA), and Blockchain to tackle long-term sourcing issues.
60% of our respondents said that contracts were the area where they saw the most opportunity for digital innovation to add strategic value to the procurement function. Intelligent content extraction technology solves the problem of assembling contracts and specifications by using learning algorithms and Optical Character Recognition to read unstructured documents and extract vital information in a matter of seconds.
Read the full Report: Innovating With Payment Providers In 2021: How CPO’s Have Adapted Their Strategies During A Pandemic