7 Procurement Predicitins for 2020
March marks National Procurement month across the world and to mark the occasion we have a number of blogs being posted across March outlining its history, the fundamentals and what we can expect in the sector for the next 12 months and beyond.
New year, new decade, new opportunities. And in the world of procurement, a chance to take stock and plan your strategy for the next year and beyond. The rise of SMART technologies, data as the new oil and new ways of working means that everyone has to adapt to the possible big changes that are ahead and procurement is no exception. Here are 7 procurement predictions for 2020.
7. Automation & Blockchain will be more prominent
SMART technologies are already becoming key to our day to day lives and the use of automation is continuing to grow within business taking over many menial and repetitive tasks. And we can expect this to only increase over time, not to the extent where people are losing jobs, but it will free up time for more focused and extensive work.
Meanwhile, more and more companies are harnessing the use of blockchain as a means of transferring money and information, as it provides a low risk of tampering with and loss of content. And with many top companies like IBM and Deloitte offering services to install such processes, it is only expected to grow in popularity.
6. The rise of Procure-to-pay ecosystems
No two organisations are the same and they will not do everything in the same manner, especially with the rise of startups and many companies going into the cloud to improve their productivity. Therefore, more holistic P2P ecosystems will be needed to manage companies’ procurement operations. It is also believed by experts that over the next 3-5 years, the P2P products that will win in the new market will be open, dynamic, and built with artificial intelligence (AI).1
5. Data as a Decision-Making Tool
For a while now people have referred to data as the ' new oil’ that will aid businesses when analysing performance and it is expected that in the next decade this analysis will form the basis of many organisation’s biggest decisions. For example, through intelligent platforms and network ecosystems, companies will be able to see more data at once and make decisions on a potential supplier’s ability to commit to payment.
And with an increasing number of data-points being uncovered by the Internet of Things and ML, the amount of data out there is continuously growing allowing for even better and more accurate predictions and therefore decisions.2
4. More focus on supplier innovation
A number of organisations continue to lag behind the rest when it comes to innovation, therefore the ability to drive supplier innovation is likely to become a high on the agenda in the next several years. The need to build an innovation funnel and pipeline, and to shorten go-to-market times will become a priority.
Organisations will need to become adept at building a coherent approach between multiple internal business units and functions and at developing metrics to track and report on the business benefits. And through new automated tools and the introduction of a single data hub, companies and suppliers will be able to collaborative together on projects much easier and quicker.3
3. The Talent race
Nowadays a degree IT doesn’t necessarily mean you will have a career in IT. So many degrees today are interchangeable and feed into many different paths and it is because of this that there is no set template for people to move into the procurement sector. It may not be traditional, but then traditional is becoming less recognisable in all ways of life.
Expect to see greater engagement of the external workforce as well as those already in the industry as a significant source of competitive advantage. The winners of the war for talent will be the companies paying attention to the demands and desires of all workers – internal and external, utilising all talents available to deliver the best result.4
2. The environmental & social impacts will be more noticable
Gone are the days where the bottom line was the be all and end all for a company’s success. Today, people are growing more and more concerned with how companies operate, making sure they are above board and transparent as association can make or break a company’s reputation and credibility.
The focus therefore is expected to move away from cost savings and compliance to true value creation and creating sustainable relationships that have positive impacts on both the environment and society. It’s not all about having the best product anymore. You need to be able to work with your customers and have that trust.2
1. Supplier risk management becomes key
Again, the bottom line is no longer as important as making sure you cover your bases to ensure the safety of your business. There’s too much risk associated with thinking merely in terms of pounds and pennies when it comes to suppliers and so companies must remain vigilant in every decision they make.1
As procurement connections expand across the globe, we have to focus on everything from local considerations to important aspects of sustainability, safety and labour practices, because living in the social media age, any negative opinion is easy to share and can cost a company millions or even billions over one wrong move.4
Learn more about our upcoming CPO Event in September 2020 here.
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