A procurement expert has urged procurement executives to take a leading role in persuading their companies to enhance their technological capabilities because they provide a “tremendous upside” for gaining improved insights into business operations.
Writing for The Strategic Sourceror, consulting procurement analyst, Christopher Ivie, explains that new advances in digital analytics allow firms to develop a more proactive outlook approach to their supply chain operations, including supply relationship management. New generation procurement teams, he said, provide “the perfect example” of the benefits of data-driven support, with cutting-edge spend analytics helping to achieve impressive cost reductions and enhanced tail spend management, while other digital solutions facilitate improvements in category management and strategic sourcing. The extra savings resulting from these data-rooted insights tend to meet with much approval.
New software solutions can analyse products and spend on the basis of both qualitative and quantitative data, allowing companies to capitalise further on, for example, the areas that deliver the majority of their income, or to consolidate arrangements where many suppliers incur similar costs. Artificial Intelligence (AI) solutions are now emerging, which will shortly allow companies to predict future market trends with impressive accuracy, enhancing opportunity assessment. Collectively, digital procurement transformation increases visibility and enables high-quality decision making – crucial for sustaining competitive advantage.
Today’s business world marches at a pace undreamt of in past eras, as reflected in a remark made by the late Steve Jobs: “You can’t just ask customers what they want and then try to give that to them. By the time you get it built, they’ll want something new.” Ivie urges CPOs to take stock of where they are currently in software capabilities. He adds: “… utilizing technical advances provides a predictive analytical skill set as well as the capacity to automate business processes.” Procurement technology today, in other words, provides an increasingly indispensable role in innovating and improving business operations.