Technology is driving procurement toward a dramatic re-engineering of its processes. As a result, the CPO’s remit is changing, moving from the tactical toward the strategic. Some procurement organizations are finding it hard to keep up with the pace of change.
But this is where the CIO and the IT team come in, bringing knowledge and skills that far increase the likelihood of successful technology implementation and digital transformation.
Are there specific things that IT and procurement can do to maximize the effectiveness of their collaboration? In a word, yes.
This new INSIGHT IT article lays out four proven strategies that will take the CIO and CPO a long way toward achieving the results and value both teams are aiming for.
Read this, and strengthen the vision that will help your team create procurement’s digital future.
Over the past few years, technological developments like cloud-native platforms, artiﬁcial intelligence-driven solutions, and robotic process automation have been upgraded from “nice to have” to “must have” within the procurement function. Technology now drives procurement and has pushed a dramatic re-engineering of its processes. As a result, the CPO’s remit has changed as well ― much less tactical and much more strategic; more collaborative, especially with ﬁnance; and more accountable for direct bottom-line impact.
Frankly, some procurement organizations have found it hard to keep up with the pace of change. Transformation and technology implementation can be slow and diﬃcult. In a recent survey by The Hackett Group, 84 percent of respondents said that digital transformation would fundamentally change the way procurement services are delivered over the next three to ﬁve years; but only 32 percent said that they actually had a digital transformation strategy in place.
Enter the CIO. As procurement and ﬁnance teams strive to create greater value for the business by harnessing new, disruptive digital technologies, the CIO’s organization has a key role to play in enabling and catalyzing this digital transformation.
CIOs are expected to contribute to the enterprise’s competitive edge by identifying and deploying new technologies, developing integration strategies, ensuring scalability and security, and maintaining suﬃcient ﬂexibility to allow for the fostering of enterprise innovation.
Experts at GEP share four proven ways in which CIOs and other IT leaders can collaborate with CPOs and other procurement leaders to drive greater enterprise-wide value.
Develop a strong understanding of procurement and ﬁnance function objectives and the key technological challenges faced by these key business partners. While there could be competing priorities, it is important to drive the decision-making process based on an elevated understanding of the overall business strategy and align the enterprise’s tech capabilities with business goals.
It’s critical to work closely with procurement and ﬁnance teams to have a clear understanding of expected outcomes from a technology standpoint. CIOs must also identify key performance indicators and establish processes to measure progress on a regular basis in addition to revisiting business goals with procurement periodically, to identify any course correction that may be needed to realign with new goals.
An ideal solution from a tech point of view may not be the best from procurement’s standpoint, and vice versa. It’s important that buying decisions be made together with input from CPOs and senior procurement leaders, who likely have perspectives derived from experience within their respective functions. CIOs in turn can help procurement identify and deploy new technologies powered by artiﬁcial intelligence, big data, IoT, blockchain, etc. Procurement solutions that incorporate these technologies ― such as the GEP SMART uniﬁed source-to-pay software platform ― accelerate digital transformation. They amplify productivity, boost accuracy and savings, and deliver next-level performance.
Once the best solution has been identiﬁed, the success of deployment largely depends on close collaboration between the IT and procurement organizations. Mutual support helps achieve the right balance between speed and eﬃcacy, as well as optimal management of the change process which yields higher adoption rates and faster delivery of results.
Disparate systems and disjointed point solutions fail to provide a holistic picture of progress ― or lack thereof ― toward business goals. CIOs must look at deploying a cloud-based, end-to-end solution that enables ﬂuid, cross-functional ﬂow of information between procurement, enterprise buyers, suppliers, and the ﬁnance team, operating from multiple locations across the globe. Fluid information ﬂow, both internally and with external stakeholders, boosts transparency and reduces the requirement of constant coordination, allowing process improvements and facilitating informed, more eﬀective decision-making. The larger procurement and supply chain ecosystem resulting from a cloud-based source-to-pay solution also facilitates supplier integration, superior supplier performance management and savings tracking.
GEP SMART is a unified procurement platform purpose-built on a single cloud-native code base with no silos, no seams and a beautifully designed “consumerized” work environment. Our software leverages artificial intelligence and big data analytics to streamline and automate processes, delivering big boosts in productivity and user satisfaction.
Mobile- and touch-native GEP SMART is built on the market-leading Microsoft Azure cloud platform ― a world-class, enterprise-scale infrastructure that very few individual companies can match. It integrates eﬀortlessly into any major ERP system or existing investment in sourcing and procurement software. To learn more about how GEP SMART can quickly generate greater proﬁtability for your enterprise, CONTACT US today.