From Cost-Cutters To Growth Enablers, Procurement Teams Are Evolving

The procurement industry is one of the fastest and most avid sectors to see massive evolution especially post the Pandemic. It is quite fascinating to see that an industry that was once focused on simply acquiring the right goods at the right time and cutting costs as much as possible is now focussing on growth and innovation strategies beyond just the two.

Procurement stands at the forefront for businesses and organizations in this aspect by following evolutionary trends beyond the norm and has proven to represent drastic change with the visible return of investment despite volatile market and unpredictable weather with the help of dramatic digitalization and proactive risk mitigation.

Here are some unmistakable shifts for procurement teams that are giving more power to businesses and keep them coming back for more.

Sustainable Growth: Source the right goods at the right price

The objective to source materials at the right time is to optimize profits and prevent or limit purchases from exposure to market price fluctuations. Improved visibility and analytics help to identify and predict price surges and make timely and informed decisions.

A supplier portfolio is an essential tool that empowers businesses to make such decisions and stay ahead of market conditions. This not only promotes the all-time reputation of the procurement sector being a cost-saving herp but also helps businesses adopt sustainable growth for their organizations by preventing over-hoarding supplies and also sourcing the right goods at the right time.

Intense Digitalization

A recent study by a renowned organization revealed that 80% of chief procurement officers (CPOs) are making investments in updating the procurement operating model. This is in an effort to enhance procurement companies and their abilities to meet business demands.

CPOs are looking for technology and tools to enhance supplier collaboration, incubate strategic thinking processes, improve business alignment and enhance the impact of procurement in the marketplace. 90% of CPOs believe that digitalization is critical to establishing all of the above in procurement and to lead to its success.

There is a heavy investment trend seen in procurement tools and technology for analytics, automation, and improvements in procure-to-pay processes. Repetitive and mundane tasks like purchase-approval processes and delivery schedules are being aided or replaced with machine learning and robotics. Advanced analytics is being used in critical areas for detailed insights into spending and supplier relations.

Appropriate digitalization strategies can fast forward procurement and accelerate product launch and also increase shareholder value. The procurement ecosystem is noticeably witnessing cost-saving and higher efficiencies with the implementation of intense, business-specific digitalization.

Improving Relationships and Alignment

As a way of improving supplier portfolios, procurement experts suggest enhancing collaboration and building mutual contracts and strategic supplier connections. These relations can come in handy for risk mitigation boosting confidence in supplier commitment and also eliminating risks in crisis with useful connections.

The relations also proved to be great for procurement teams to induce innovation and create a competitive advantage. The strong relationships have helped procurement teams to share innovations together and their expertise. This helps to gain insights regarding commodity and market category, shift in consumer trends, and opportunities for growth which can help develop new market strategies and innovations.

Proactive Risk Mitigation with Superior Data-Driven Processes

Data-driven processes are not a new trend in procurement. But, new data sources and insight-delivery tools have changed the way procurement teams make decisions and mitigate risks.

Advanced analytics AI, curated data sets, and insights have enabled procurement teams to learn more about suppliers, commodities, and market trends. They have shifted the process from analyzing historical data to mitigate risks to making proactive decisions with timely and reliable insights to detect threats and transform risks into lucrative opportunities.

Future of Procurement: Driving Strategic Businesses

Truth be told, the future of procurement cannot be predicted as yet. However, procurement does set a benchmark in addressing adversities and transforming business models to face disruptions as seriously as seen throughout 2020-2021.

Procurement has been a pioneer in helping businesses understand crisis management and maintaining operational continuity.

Procmart has realized the potential of data-driven strategies and insights that can revolutionize business operations and decision-making processes. It has several businesses digitize their procurement processes with their competitive solutions.

Find out more about how Procmart can help you join this revolutionary race.