Whatever the strategy we believe must have digital procurement processes

Whatever the strategy we believe must have digital

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to use, based on a predefined road map. Whatever the strategy, we believe “must have” digital procurement processes include digital requests for quotations, supplier financial analysis, procurement risk analysis, e-signatures and verification, and digital procurement network collaboration. Note that investing in new digital tools is a means to an end — not the end itself. Ideally, this investment will lead to digitally automated processes, even beyond the transactional purchase-to-pay, with only limited manual support required. Such digital tools and processes will additionally support business process outsourcing and shared-services centers, further boosting efficiency. Ultimately, however, the benefits will arise not simply from reducing costs, but also from freeing up highly qualified procurement resources from mundane, repetitive tasks so they can focus on delivering value to the business. 6. Organization and capabilities It is clear that the first five elements of the framework — even if not all are relevant to every company — pose such a tremendous change to the way of working for procurement that they require a fundamental “rethink” regarding organization and capabilities, both of which will need to be reshaped over time. Companies will need to create new job profiles, for example, whether for buyers of new categories of items, contract experts on intellectual property, or data scientists for data maintenance, analysis, and mining. To find this talent, new sources must be unlocked with the help of procurement cooperation partners such as university partnership programs and research centers, along with social networks, social media, and “boomerang rehires” — top-performing employees rehired after a few years’ absence. The largest companies should consider establishing their own procurement academies to conduct Webinars, cross- functional training, and supplier workshops. Only if procurement personnel are digitally capable can a company fully benefit from the opportunities provided through digitalization.
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10 Strategy& In addition, digitalization will increase globalization and speed up communications in an ever more closely connected world. Whereas it was once enough to have knowledge about certain supply markets such as China and Eastern Europe, Procurement 4.0 will require an organization that is truly global. For example, having the core of the procurement organization housed at headquarters might have worked in the past, but looking ahead, more and more buyers may need to be located in the most competitive supply markets for each category.
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11 Strategy& Conclusion The introduction of Procurement 4.0 will mean developing new value propositions, meeting new business needs, and integrating data across functions and value chains. It will call for using this data proactively and intelligently, while introducing digital processes and tools.
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