Digital procurement has seen significant advancements in recent years, with companies around the globe embracing the power of technology to streamline their procurement processes. The recent Digital Procurement World Conference (DPW) provided valuable insights into this growing trend, offering three key takeaways highlighting digital transformation's importance in procurement.
I genuinely thought this event was incredible. It’s unlike any other procurement event I’ve been to or seen.
1 - Global Companies Turning to Digital Procurement
One of the major takeaways from the DPW Conference is the increasing number of global companies that are adopting digital procurement strategies. These companies recognise the potential for technology to enhance their procurement operations, resulting in improved efficiency, cost savings, better risk management, and greater transparency throughout the supply chain.
Traditional procurement methods no longer suffice. The complexities of managing procurement across multiple regions and vendors necessitate the integration of digital tools and platforms. You cannot carry on doing procurement in Excel. The sheer manual burden of attempting to keep data up-to-date and managing your procurement processes is impossible.
“When I talk to people running supply chains (analysts to executives), they operate in a Digital 1.0 realm. Digital 1.0 uses email, spreadsheets, shared drives, PDF files, presentations, and offline notes”. - Dr. Elouise Epstein, How to hack your supply chain.
But does going digital in procurement always work out?
No - that’s why the theme at DPW 2023 was “Make Tech Work”.
The focus was on making procurement tech work for the entire organisation and not just procurement teams. I had many conversations with procurement leaders who were using a legacy system, or nothing at all, and were struggling with the digital vision.
These led to detailed conversations about how our Vendor & Contract Lifecycle Management (VCLM) Platform, a category of procurement technology that we are creating, could work for them.
Despite the undeniable benefits of digital procurement, implementing and optimising procurement technology can be challenging. Challenges such as:
- Poor vendor and contract data
- Poor implementations that drag on without an ROI
- Getting your stakeholders to use the tech and deviate from their previous working methods.
The DPW Conference emphasised the need for organisations to manage their digital procurement transformation to maximise its value effectively.
That’s why at Gatekeeper we’ve built a team dedicated to implementations, utilising our 3 Pillar Methodology, to ensure that you’ve got a partner who is vested in your success. Too often we hear horror stories of procurement implementations that have gone over budget and not delivered within the required timeframe.
Successful digital procurement transformation requires careful planning, strong leadership, and effective change management. The latter point is often overlooked. You’ll need to develop a comprehensive strategy that aligns with their business objectives and leverages technology to drive innovation and efficiency, to make those business objectives a reality.
User adoption of tech is usually a point of contention. Ensuring user adoption and providing adequate training and support are essential for successfully implementing digital procurement solutions. You have to ensure that your employees and colleagues have the necessary skills and knowledge to effectively use these tools and extract maximum value from their procurement technology investments.
I heard countless stories from attendees using X, Y and Z legacy solutions who struggled with getting their colleagues to use them.
It’s not clear.
If no one uses the tech that has been implemented, then you’ve wasted a lot of time and money.
I was encouraged by the conversations that everyone was having with all of the procurement tech solution providers at the event. This felt like a pivotal moment as people truly, for the first time, en masse, understood the benefits of making digital procurement work.
2. A Move Away From Legacy Procurement Tech That Doesn't Work
I touched on this in point one: there seemed to be an urgent need for businesses to move away from legacy procurement technology that is no longer effective.
Legacy procurement software often lacks the necessary flexibility and scalability to meet the demands of modern supply chain management.
These outdated systems result in fragmented data, manual and error-prone processes, and limited collaboration capabilities.
Not to mention the need to hire consultants and solutions experts to make changes for you. That’s why a SaaS-based offering, with no code functionality, built in the cloud, is the best approach for you.
As a result of legacy procurement tech (this is usually an ERP with vendor and contract management bolt-ons), organisations often struggle to achieve efficient procurement operations and miss out on potential cost savings and competitive advantages.
With legacy systems, tracking and monitoring procurement activities can be a time-consuming and labour-intensive task. One of the main advantages of modern digital procurement solutions is their ability to provide real-time visibility into the entire procurement process.
That’s why I’ve always loved using the Kanban workflows in Gatekeeper. These gave me an incredible insight into my team’s work and the work I was undertaking on contracts, especially with my external legal team that supported me. It enabled me to orchestrate every process we had, and helped us identify a lot of issues with the existing processes that could then move into remediation.
The legacy providers didn’t always have Procurement in mind.
Elouise Epstein has noted numerous times, as I heard her at this event, state that “the ERP is dead”. She noted in her latest book that I was fortunate enough to get an early copy of it at DPW.
Furthermore, modern digital procurement solutions offer enhanced collaboration capabilities, allowing different organisational stakeholders to work together in the platform. This keeps clean and useful data in the place it needs to be, rather than have it hiding away in email and Slack messages. This collaborative approach improves communication, reduces errors, and fosters innovation and creativity in the procurement process.
But technology is only part of the puzzle. We need digital procurement professionals who understand natively, how to utilise tech to make procurement better.
3. Digital Procurement Pros are the Future
The DPW Conference highlighted the growing importance of digital procurement professionals. As companies increasingly take on procurement digitalisation, the demand for procurement specialists with technical expertise and a deep understanding of digital procurement best practices continues to rise.
Digital procurement professionals are crucial in driving organisational transformation by leveraging technology to improve procurement outcomes. These individuals possess procurement knowledge, technological know-how, and data analysis skills, enabling them to optimise procurement processes and deliver strategic insights.
The conference featured presentations by digital procurement leaders who shared their experiences and discussed the critical skills needed for success in this evolving field. From proficiency in data analytics to a strong understanding of emerging technologies, digital procurement professionals are shaping the future of procurement and driving innovation within their organisations.
One of the key topics discussed at the conference was the impact of artificial intelligence (AI) on digital procurement. AI has the potential to revolutionise the procurement process by automating routine tasks, enhancing decision-making, and improving overall efficiency.
In addition to technological advancements, digital procurement professionals must possess strong communication and collaboration skills. As procurement becomes more integrated with other business functions, professionals in this field must be able to effectively communicate with stakeholders, negotiate contracts, and build strong supplier relationships.
This comes down to the People, Process, Tech matrix.
My biggest takeaway from the event was that people across the profession were there to learn.
- From each other
- Through formal talks
- Through conversations with tech vendors
If you’re serious about digital procurement then DPW is a must-attend conference. There’s nowhere else like it where you can feel the energy of people nerding out about digital procurement. Where people want to move away from spreadsheets, emails, and poor data, and push towards an era of value-added procurement work.