Digital Transformations: The New Torch Bearer for Procurement Excellence
Digitalization is not just transforming the customer experience but is also making significant changes in the way businesses operate, especially by creating new job roles in organizations. We are familiar with the designations of CEO, CFO, and CMO, but CDO or chief digital officer is a relatively new job role that is cropping up in […]READ MORE >>
Digitalization is not just transforming the customer experience but is also making significant changes in the way businesses operate, especially by creating new job roles in organizations. We are familiar with the designations of CEO, CFO, and CMO, but CDO or chief digital officer is a relatively new job role that is cropping up in most companies currently. With the growing inclination of the target market segments towards digital media, a good digital marketing team and chief digital marketing officer have become inevitable for businesses. However, there is more to the function of a chief digital officer than merely watching over the digital media strategies of a company. They also play a crucial part in vital business functions such as strategic procurement.
Role of a chief digital officer
As mentioned earlier, the chief digital officer is a new role in most industries. They indulge in various operations such as back-office functions, supply chain, and procurement to name a few. Every company might have different understanding of digital strategies. Therefore CDOs have to decide how they want to drive digitalization into their core business. Some of the aspects that they examine for the transformation of procurement are:
- Do the current procurement strategy drive innovations for collaboration with suppliers
- The existence of proper risk management
- The sustainability of the supply chain
The CDOs’ efforts ensure that the current business model is future ready and drives saving by reducing transaction cost.
Key areas for digital transformation in procurement
The advent of technology has given birth to some considerable changes in the procurement process in the past few years and is expected to do so in the coming years as well. Given below are some of the critical aspects that can benefit from digital transformations:
Several successful companies have already started implementing digitalization into procurement to boost the value of their organization and gain the trust of various stakeholders. Technology is helping these organizations to personalize stakeholder experience across multiple channels. Digital transformations also allow companies to look beyond savings and boost efficiency.
Build a procurement-as-a-service portfolio
To align procurement more closely with the requirements of stakeholders, companies should work to create an ‘as-a-service’ portfolio that would streamline the overall buying experience. Digital strategies can help businesses to ensure that the resources are placed globally and also keeps a check on the efficient functioning of their centers of excellence.
Analytics, data, and insight
The aim of procurement should be beyond creating an isolated organization- it should become a trusted business advisor that works to optimize its functions and boost value across the organization as a whole. Digital advancements have made it simpler for companies to gain proficiency with advanced technologies such as big data analytics. These techniques enable more sophisticated and accurate decision making based on crucial data.
Accelerate transformation with technology
Procurement should leverage tools that can accelerate its digital transformation. Social media, RPA, cognitive computing and big data tools can be used to make the organizations more profitable and efficient. The management must identify the tools that are proving to be most beneficial in accelerating procurement and find ways of refining it further and duplicating it across the business.