Procurement is changing...fast. If you want to know what’s up next for Procurement, keep reading.
At Scanmarket, we get to see first hand how world class procurement organizations are tackling key challenges.
The Buyer's Role
The buyer's role has changed from buying goods to buying services to buying solutions, and they are now the main driver of supplier innovation. A buyer today is expected to drive value by reducing costs but also by creating additional value through partnerships with suppliers and identifying new ways of doing things, new products, new materials, new packaging, etc. The days of the traditional buyer are being replaced by something much more strategic.
Additional read: Procurement Value Beyond Savings
Automation and RFP's
Procurement teams today have access to immense amounts of data that is nearly useless without a structured approach organize, analyze and interpret it. The key to successfully leveraging artificial intelligence (AI) lies in taming data. AI can automate entire processes and know when to go to market with an RFP, build an RFP, source suppliers, run the RFP, evaluate and award business, and manage PO's, approvals and invoices.
Additional read: 5 Tips to Achieve More With Your eRFx Platform
One of the most powerful trends we see is organizations finally harnessing the power of spend analysis to create category dashboards which inform a buyer of the following:
- All current spend data within a category
- All supplier info (e.g. D&B data)
- Reviews of those suppliers from stakeholders but also from other companies using the same supplier (like reading reviews on Amazon or on hotels.com before buying)
- Forecast or pricing trends and in-company needs which helps the buyer negotiate the best terms and contracts
The real value-add from AI will be finding ways to organize data in a way that informs decisions. The market isn't 100% there yet, but we’re watching closely.
RFx Process Improvements
We are always on the lookout for new and improved approaches to RFx management. One of our customers recently shared some RFx management tips including tactics that are used too infrequently. For high-value efforts, invite potential suppliers to face-to-face meetings before even writing your RFP/requirements. This will allow you to learn a great deal about the suppliers and their capabilities as well as drive innovation through suppliers. Buyers can actively involve their suppliers in the wider holistic process to help drive supplier engagement and end-to-end value through a buyer’s supply chain.