Winter, July 2014

Procurement's digital revolution

Speaking at the recent SAP Cloud Connect conferences in Sydney and Melbourne, Principal Consultant at The Faculty, Scott Levens warns procurement is going through something of a digital revolution.

“As Procurement professionals, we’ve always thought of ourselves as quick-off-the-mark, but the truth is we’ve often lagged behind when it comes to comparing ourselves with other professions”.

But things have changed; digital presents a myriad of opportunities for procurement to be more agile (we can source differently and buy smarter), share data on a larger scale (improve process and distribute learnings), plus mobile technology means procurers are available 24/7. 

Mobile Technology and Procurement

“The advent and availability of mobile technology hasn’t just transformed the communication between stakeholders and suppliers, it is also giving professionals the freedom to work from anywhere in the world,” Scott told conference goers. 

True enough - The transformation started long ago with the humble BlackBerry – an item once seen in the hands of every savvy, young professional. From there we’ve gone on to witness the rise and rise of Apple, not to mention Android’s thundering land-grab for the biggest slice of mobile market share (which incidentally stands at a colossal 1 billion active users a month).

On mobile, Scott says: “As you’ll come to see, the mobile is one of the most powerful weapons in every procurement professional’s arsenal.”

Industry commentary around mobility has promoted the thinking on how this represents a fundamental shift in our thinking and how this applies in a commercial context – this includes buying and paying for things. Through Consumer to Business (C2B) and Business to Business (B2B), it is absolutely going to affect how people procure.

Impact of social media on procurement

With this shift to digital, Scott believes the issue of social networking is already being felt by Procurement.

“Collaboration between communities has opened-up avenues of peer-to-peer learning, if for no other reason than of sheer convenience alone,” says Scott.  

“This is also leading to the rise of vertical, niche networks, for example SpiceWorks (IT) and Procurious (Procurement),” he warns.

“Suppliers and buyers can find each other, even on the other side of the world more easily and connect / collaborate. So too can employers and prospective employees.”

However, according to Scott, the uptake of social is not without concern: “Social media introduces an element of uncertainty and danger. Many view social media a lawless, often unregulated outlet. In the wrong hands it has the potential to damage an organisation’s or brand’s reputation almost instantaneously.”

Reinvigorating business practices

Aside from making us all more social, mobile technology is reinvigorating staid methods and processes; one such example being around goods receipt and issue.

“Our stakeholders within our organisations who require goods and services from suppliers procurement have engaged are becoming more savvy than ever before and wanting deeper insights into the supply chain instantly.”

“From a consumer perspective, how buyers behave changes how organisations both source and offer their services.” Indeed, the use of mobile platforms as a tool of convenience is forcing organisations to change how they engage with the end customer.

So how to approach emerging technologies and incorporate them successfully into Procurement practices?  Scott has the following recommendations for Procurement leaders:

1 Change Led Approach

We must understand what the barriers may be in the business to adoption of any change and develop a plan to address these.

2 Be future ready

Take advantage of the latest advances in technology – don’t be afraid of it. It’s only there to make your lives easier, communications quicker and processes faster. However it must be noted that technology is an enabler, not the answer.

3 Embrace social media (but play nice)
Social provides you with the opportunity to know and understand your customer bases at a more personal level. You’ll also benefit from keeping abreast of global developments as they happen. 

The Faculty Roundtable is running Issues Workshops on Digital Procurement in Melbourne and Sydney on 29 July and 31 July respectively. 

If you are a member of a Roundtable organisation and would like to register - or simply to find out more about The Roundtable's program of Issues Workshops, click here.