The research revealed widespread vulnerabilities in several important aspects of procurement, including the fact that one in three executives still use phone, email, and spreadsheets as the primary means of collaboration with external partners in key supply chain processes; less than half of executives have real-time or near-real-time visibility into stock levels at their own or suppliers' facilities; about half of executives in direct spend report delivery delays and shortages of finished goods/WIP with direct material suppliers; approximately four in 10 procurement executives encounter digital security breaches with temporary workers and contractors "sometimes, often, or in almost every engagement".
Despite the challenges, they have identified a group of leaders - around 10% of executives, who stand above the rest as those who have invested more in the digital transformation of their procurement functions, are achieving a more consistent ROI.
To drive success in digital transformation, leaders have taken four important actions. The first is to focus on impact, meaning they are more likely to see procurement 's impact beyond the traditional focus on reducing cost and risk. The second is to invest more in technology, especially core procurement technology. However, they are still wasting capital. For example, leaders and other executives have the opportunity to better manage temporary workers through procurement technology. The multiple-bid functionality, which automatically bids projects to preferred suppliers, can help get better value for money. Third is that leaders are more often using data and analytics functions to inform spending decisions across the organisation and influence the business. Although more than two-thirds of executives say they have a clear view of costs across the organisation, leaders make better decisions when they are based on data informed by information. Finally, leaders are making substantial investments in AI, Machine Learning, RPA and predictive analytics functions and cognitive assistants. These technologies can help companies gain quick insights to fundamental decision-making and automate processes to increase speed and agility.
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This article is republished in partnership with Supply Chain Magazine - Read the original article here.
