Procurement activities comprise a significant chunk of an organization’s cost and have a significant impact on the cost of the final product. As a result, organizations are looking for cost-saving measures to remain competitive in the marketplace. Digital procurement offers organizations a streamlined view of all their procurement process by eliminating redundant procurement steps and increasing the procurement process efficiency.
Organizations adopt digital procurement for the benefit it provides such as reducing the purchasing price, optimizing the procurement cost, bringing about internal process optimization, securing supplies, minimizing warehousing costs, and maintaining quality guidelines.
Here are the top 5 trends in digital procurement:
Automation in Procurement:
Automation technologies such as source-to-settle processes, procure-to-pay, e-procurement, and contract management have eliminated the need for constant human intervention by automating sourcing, procuring, and invoicing processes. With savings in time, even non-procurement professionals can handle the process, and help procurement professionals utilize their time in procurement strategy making. Requisition approvals, automated MRO re-orders, supplier profile maintenance, and purchase-to-pay (P2P) are among the most automated processes in digital procurement
Data Analytics in Procurement
Big data and analytics help the procurement organization to unlock the real value of data by gathering in-depth insights. Big data analytics help save significant time and cost for the procurement organizations by using predictive analytics, trend analysis, risk management, and category management. Applications such as vendor evaluation, spend analytics, and demand forecasting are some of the most popular applications to use data analytics in procurement.
Cloud based Digital Procurement for Small and Medium Sized Businesses
Digital procurement is certain to benefit the procurement organization, but it does come with a hefty price tag? Since digital procurement is moving from being a cost saving tool to a business essential, small and medium sized businesses are also finding ways to reap the benefits of digital procurement. Cloud-based platforms are gaining popularity among these organizations for their budget-friendly attribute.
Dedicated Procurement Systems for Large Organizations
Traditional digital procurement systems were designed with a one-size-fits-all mindset. But with exponential growth in transaction volume and increasing need complexity of each business and suppliers, they demand customized offerings out of these systems. For process efficiency and optimization, large organizations are shifting towards developing their own custom platforms.
Outsourcing it to the Experts
E-procurement isn’t one of the core competencies for many of the organization and may lack expertise in procurement, supply-chain, and logistical challenges. Many organizations now seem more reluctant to leave the complex digital procurement process to the experts and instead prefer outsourcing all their processes to ensure the smooth operation of the business.
Digital procurement is gaining popularity among procurement organizations with an increasing adoption rate. The future for digital procurement would be data driven, and organizations would have to adapt to a high level of automation so that their experts can focus their time on value-added strategic tasks.