5 minutes with SAP executives: supply chain & procurement
How has the supply chain and procurement industry evolved over the last year following the impact of COVID-19?
2020 has been defined by supply chain disruption. The impact of COVID-19 has accelerated trends that will not only lead to the diversification and localisation of supply chains, but also increase the need for digitalisation and end-to-end visibility. Now more than ever, procurement is uniquely positioned to be transformative and highly impactful for businesses as we enter a new era of data-driven intelligence.
A shift away from the traditional, linear supply chain to a broader supply network, coupled with dynamic partnerships driving innovation, will be key to gaining a 360-degree view of supply, improving cash flow, developing new products and pursuing sustainability initiatives. Breaking away from reactivity and focusing on proactivity will be essential in tackling new business challenges in a post-COVID-19 world. Network strategies, and making use of data-driven insights, will be important in avoiding repercussions from future shocks and shifts, replacing linearity with interconnectivity.
Over the next few months which technology do you see playing a vital role in the supply chain and procurement industry?
I foresee cloud-based solutions, particularly with regard to external workforce management, playing a vital role in lending businesses the flexibility they need to take steps toward recovery. Just as they always have, contingent labour and services providers deliver the depth of skills and expertise necessary to propel businesses forward. With the right sets of digital tools, organisations can achieve maximum visibility and value from these essential workers, ramping up and down efficiently as the new year unfolds.
Why is the adoption of data analytics important for procurement?
Procurement without data and analytics is simply spend. Procurement can and should play a strategic role within the business, but this can only be achieved with a strong analytical foundation. To drive true organisational change, procurement professionals should arm themselves with data and analytics. Knowing where and how money is being spent, as well as its impact, empowers procurement professionals to make a case for both systematic improvements and the change management required for success.
How can procurement analytics benefit supply chain functions?
The efficiencies gained through digital transformation and the automation of standard procurement functions have freed up procurement professionals to focus on more strategic activities. It can be argued that none are more strategic than data analysis. Digitisation produces massive amounts of data to help procurement professionals make informed decisions that positively impact their organisation’s financial outcomes. Utilising this data, procurement professionals can gain insights into how to drive benefits around cost savings, supplier consolidation and purchasing power.
What are the current trends in procurement analytics?
At the heart of automation is data. With a strong analytic foundation, businesses can get the most out of their digital transformation and truly leverage Artificial Intelligence (AI) and Machine Learning (ML). In a global economy, companies using these tools can deliver insights across their supply network. When this data is captured consistently across procurement operations, and ideally across multiple customers, it becomes more accessible and meaningful. Ultimately AI has the power to increase productivity across trading partners and across the spend horizon through the network effect.