The pace of innovation in the procurement industry is picking up steam at a rapid rate. Technological advancements in blockchain, 3D printing, machine learning, and more continue to drive this change creating both challenges and opportunities in supply chain management. While external factors, such as unpredictable customer behaviour, weather or traffic patterns can disrupt the supply chain, a lot of focus is being placed on operational efficiency and strategic functions that can be derived from advanced procurement practices.
Let’s take a look at key procurement trends that will change your business in 2018:
Big Data Analytics
Big data analytics will continue to play a key role in improving sourcing, planning resources, collaboration and managing supplier risk. Predictive analysis is still an untapped resource in the context of supply chain for most businesses. If used correctly, it can anticipate and respond to disruptions well in advance. This will also ultimately give rise to using cognitive procurement to turn data into actionable insights and enable accurate calculations of ROI. Supply Chain Managers will slowly switch to automating supplier management, contract lifecycle management, and spend analysis using the power of natural language processing (NLP).
Cloud & IoT
Cloud-based technologies are increasingly penetrating the procurement industry and as a result increasing efficiency and productivity of process and function. Real-time view of budget reports and elimination of human error provides easy access to business metrics. This can in-turn be used to make smarter purchasing decisions that can keep up with consumer demand and help businesses remain competitive. Cloud technologies along with IoT encourages the popularity of (SaaS) software-as-a-service applications that can benefit even small businesses.
In the coming years, cybersecurity will surpass physical security as the top concern for most manufacturers. As procurement trends slowly shift to digitally enabled supply chains that depend on cognitive performance, businesses will be pushed to heavily invest in cybersecurity as a priority. The numerous attacks such as WannaCry, Shadow Brokers, Petya and the likes caused a lot of problems across the world. With continuous ransomware and malware attacks troubling the procurement professionals, privacy protection protocols to keep data safe will be set up.
Blockchain brings greater fidelity, performance and value to procurement by way of supply chain. However, it is still at its nascent stage. This year will see the wide-ranging uses of blockchain for supply management teams from procure to pay processes. A digital automated record will be the new due diligence or track-and-trade tool that is updated in real-time allowing procurement teams to gain visibility control and quickly determine the commodity’s point of origin.
A major change this year will be the integration of technology with supply chain creating a more collaborative procurement environment. The greater need for transparency in the business can be harnessed with the collaboration of information with other parts of the business. Fully integrated platforms allow suppliers and procurement professionals to share and manage important data online, thus, streamlining the entire process. This can also lead to enhanced relationships, increased agility and improved marketing procurement which makes collaboration a crucial driver of business value.
The need for sustainability coupled with consumer preference on brands that are doing environmentally or socially good is making procurement business gain traction for corporate social responsibility. Consumers are willing to pay more for sustainable brands; hence a key role is given to a brand’s CSR credentials.
In 2018, the procurement industry will be constantly pushed to rethink and redefine their strategies to keep up with the evolution of trends. The emergence of disruptive technology will continue to lead the change with blockchain and predictive technology that allows businesses to manage their supply chain more efficiently and effectively. The future of B2B technology will witness the growth of artificial intelligence with the use of voice chatbots. This provides a great opportunity for procurement industry to work on a user-friendly interface and assign major job roles to the supply chain assistant. Businesses who quickly leverage these new technologies in enterprise procurement will be able to do more with less, keeping them ahead of the competition. Follow best practices in supply chain while strategically implementing these emerging trends with operations to benefit from efficient and effective business outcomes.