Procurement leaders have, for some time now, found themselves under growing pressure to inject a greater degree of flexibility into operating models and offer their stakeholders an improved, consumer-grade user experience. The impact of the pandemic and subsequent soaring inflation has only added to this pressure, forcing procurement to shift its focus toward finding new ways of increasing the resilience and agility of its processes and operating models. Ultimately, the recent events have served as a wake-up call for CPOs everywhere and while, agility has always been important to the success of procurement, it has now become a, if not the, top priority.
The key to injecting more autonomy and agility into procurement is to take the functions’ operating processes, historically manual and time-consuming with employees spending countless hours on administrative tasks—and design them to be user friendly, completely digital and intelligent. Not only does this increase efficiency and enable procurement to do more with less but it also delivers new real-time data and greater insights, which will help CPOs respond more quickly and efficiently to meet future unexpected challenges and maintain a competitive edge, even in times of uncertainty.
Agile value chains are heavily reliant on businesses having access to the intelligence that will allow them to respond immediately to both internal and external changes. As has been highlighted by the recent disruption, the use of AI to automate a company’s core processes is critical to its ability to achieving better and faster results. By reimagining current capabilities and embedding intelligent insights into a company’s business processes, it will allow both procurement teams and business stakeholders to access and act upon valuable information and insights, driving better outcomes across the entire organization.
By leveraging the innovative power of AI through digitalization, procurement can maximize outcomes for indirect spend and benefit from a more agile sourcing process that has three main elements:
- Digitalization allows procurement to do more with less, generating 60-70% productivity improvement, bringing 30-40% more spend under management, and delivering 10-20% cost savings, which together leads to more than 20 times ROI through an inclusive, competitive and transparent sourcing model.
- Moving more spend to self-service without sacrificing any aspect of compliance or risk management drives and multiplies these operating efficiencies and cost savings, while freeing up procurement talent to become business advisors and relationship managers, focusing on more value-driven strategic tasks such as supplier collaboration, innovation and R&D.
- Creating a consumer-grade, intuitive experience that delights business stakeholders will not only bring more spend under procurement’s control but also increase the function’s influence across the organization and will help to earn that long-talked about seat at the table.
Forward-thinking CPOs are already adopting new technology that can optimize the sourcing process and enable their teams to operate in a more agile manner. With an intelligent, autonomous sourcing platform like Globality, business stakeholders are guided, step-by-step through an intuitive interface by our AI advisor Glo, helping users to make the right decisions and connect with the most valuable supplier quickly and efficiently. This new intelligent and agile approach will enable procurement to deliver better business outcomes and help companies not only survive but also thrive during the current uncertain economic times we are living through.