Evolving Role of Procurement: “More human being thanks to a full digitalization”

Markets have ever faster evolutionary dynamics. Resilience to change is increasingly pressing and not anymore, an option for all the companies (an example is what happened with the Covid-19 pandemic).

Digital Transformation is the new normal!! As all the revolutionary transition from a “pre” to “post” status quo is a big challenge where the starting point is well known while the destination must be designed with any warranty about the final results. Many firms everywhere in the world, even they are leaders or followers, in most of the industry sectors despite the specific maturity or sanity, have passed from willness to consciousness that this journey has to be done. Such decisions have been taken with no further hesitation due to the pandemic issue started since beginning of 2020. The situation by now is that only few firms have been succeed in Digital Transformation while most of them have only completed specific task (es. IT modernization, process simplification, dematerialization, etc.) with no link with business strategy for improving overall performance in a sustainable way.

The role of Procurement in this context can have a great impact for the Company but only if it is progressively moving away from the sole dimension of the “saving”, it is necessary for Procurement to develop itself and move from an “Efficient machine” to a “Sustainable Value generator”.

The field experience suggests that an efficient “procurement machine” is the first enabler to evolve the role to the value generation, (and it’s not a given factor), so is essential to constantly work to improve the organizational set – up through a continuous process reengineering useful to design, implement, consolidate and improve again.

It should also be noted that the Procurement People, in order to be recognized as a Business Partner, able to make an high contribution from the Suppliers ecosystem and to reach  the business targets, have to change the mindset, bring natural entrepreneurship outside the boundaries, stop to claim lack of visibility and learn to act without any bias in order to support business as a valuable part of itself.

A way to do that is starting to work on two different project layers:

a) digital transformation;
b) training evolution.

Moreover, with the continuous evolution of the tools landscape and processes ecosystem, Procurement Department has to plan a progressive adoption program of innovative technologies like RPA (Robotic Process Automation), AI (Artificial Intelligence), ML (Machine Learning) and so on for supporting the performances not only in terms of savings but specially to optimize the buyer’s experience and consequently the value earned by the Company.

The digital transformation path has a parallel path dedicated to the people training roadmap evolution. It’s crucial to design an adaptive program where you can learn not only traditional competences or common soft skills, but even more to increase the personal awareness of Procurement People on how enormous the potential of their work is if experimented on a large scale, using massively the new technologies and allowing different levels of interaction with Suppliers and internal Stakeholders to accelerate the overall business performance and become a key factor for the growth of the Company. This program set-up should be done creating a cross virtual team that is in charge to define (and update) the challenges and gaps that gradually emerge thanks to the effects of digitalization in terms of time freed, new features availability, business variability. The list of topics is directly linked to such changing scenarios.

Digital transformation combined with human being well trained become, even more, during times of disruption and crisis, an enabler for improving the quality of the money that procurement spends granting an adequate time to market, agility, resiliency and finally margins to the company regardless of the specific business sector.