Category Archives: technical procurement

The Dangers Of Dirty Data

Is your organisation working with ‘dirty data’? How would you know? And, what impact is it having? This article has everything you need to know about doing a quick spot check, spotting procurement problems, identifying savings, and more importantly, making sure your data has its COAT on.


We all think we know what dirty data is, but it can mean very different things depending on who you speak to.  At its most basic level, dirty data is anything incorrect.  In detail within procurement, it could be misspelled vendors, incorrect Invoice descriptions, missing product codes, lack of standard units of measure (e.g. ltr, L, litres), currency issues, duplicate invoices or incorrect/partially classified data.

Dirty data can affect the whole organisation, and we all have an impact on, and responsibility for the data we work with.  Accurate data should be everyone’s responsibility,  but currently across many organisations data is the sole responsibility of a person or department, and everyone trusts them to make sure the data is accurate.

But, they tend to be specialists in data, analytics and coding, not procurement.  They don’t have the experience to know when a hotel should be classified as accommodation or as venue hire, or what direct, indirect or tail spend is and its importance or priority.

How many times have you been working with a data set and noticed a small error but not said anything, or just manually corrected something from an automated report, just get it out the door on time?  It feels like too much of an inconvenience to find the right person to notify, so you just correct the error each time yourself, or you raise a ticket for the issue but never get round to checking if it’s resolved. 

These small errors that you think aren’t that important can filter all the way up to the top of an organisation through reports and dashboards where critical decisions are being made.  It happens almost every day.

How does this affect my organisation?

There are many ways, but one of the most widespread and noticeable impacts is around reporting and analytics.  If you’re in senior management, you will most likely receive a dashboard from your team that you could be using to review cost savings, supplier negotiations, rationalisation, forecasting or budgets.

What if within that dashboard was £25k of cleaning spend under IBM?  I can already hear you saying “that’s ridiculous” – well, it is obvious when pointed out, but I have seen with my own eyes IBM classified as cleaning.  It can happen easily and occurs more frequently than you might think.

Back to that dashboard that you are using to make decisions, you’ll see increased spend in your cleaning category, and a decrease in your IT spend, which could affect discounts with your supplier, your forecast for the year, monitoring of contract compliance etc…  It could even affect reporting of your inventory,  it appears you need more laptops, and unnecessary purchases are made. 

When there are tens or hundreds of thousands of rows of data, errors will occur multiple times across many suppliers.  And for the wider organisation, this could affect demand planning, sales, marketing and financial decisions.

And then there are technology implementations.  Rarely is data preparation considered before the implementation of any new software or systems, and there can even be the assumption that the software supplier will do this, which may not be the case, and if they do provide that service it might not be good enough.

It can be very far into the process of implementation before this is uncovered, by which time staff have lost faith in using the software, are disengaged, claim it doesn’t work, or they don’t trust it because “it’s wrong”.  

At this point, it either costs a lot of money to fix and you have to hope staff will engage again, or the project is abandoned.  In either case, this can take months and cost thousands, not millions of pounds/euros/dollars in abandoned software or reparation work.

You might also be considering using, or engaging with a 3rd party supplier that uses AI, machine learning or some form of automation.  I can’t emphasise enough the importance of cleansing and preparing your data before using any of these tools. 

Think back to the IBM example, each quarter the data is refreshed automatically with the cleaning classification, that £25k becomes £50k, then £75k the following quarter, it’s only when the value becomes significant that someone notices the issue.  By this stage, how many decisions have been based on this incorrect information?

How can this be resolved?

Truthfully, it’s with a lot of hard work.  There’s no magic bullet or miracle solution out there to improve the accuracy of your data: you have to use your team or an experienced professional to get the job done. Get your team to familiarise themselves with the data. If they are reviewing and maintaining it regularly they will soon be able to spot errors in the data quickly and efficiently.

If you think about data accuracy in terms of COAT, this will help to manage your data.

It should always be Consistent – everyone working to the same standards; Organised – categorised properly; and Accurate – correct.  And only when you have these things will it also be Trustworthy – you wouldn’t drive around in a car without a regular inspection would you?

How to spot procurement problems and identify savings

Accurate data is important, but in its raw state, it’s not the whole story.  As a procurement professional you’re tasked with ensuring the best prices for products or services, as well as ensuring contract compliance on those prices, along with cost reductions and monitoring any maverick spend … to name but a few!

Accurate data alone will not help achieve this, I strongly recommend supplier normalisation and spend data classification to help quickly and efficiently manage spend and suppliers, monitor pricing and spot any potential misuse of budgets.

How do I get started?

With a spreadsheet of spend transactions over a period of time such as 12 to 24 months, the first step should be Supplier Normalisation, where a new column is added to consolidate several versions of the same company to get a true picture of spend with that one supplier.  For example, I.B.M, IBM Ltd, I.B.M. would all be normalised to IBM.

Data can be classified using minimum information, such as Supplier Name, Invoice/PO line description and value. To get more from the data, other factors can then be added in, such as unit price. Where unit price information is not available, the quantity can be divided by the overall value.

A suitable taxonomy will then need to be found to classify the data.  It can be an off the shelf product such as ProClass, UNSPSC, PROC-HE, or a taxonomy can be customised so it’s specific to your organisation or industry.

This initial stage may take months if you are working with large volumes of data. It might be worth considering outsourcing this initial task to professionals experienced in this area, who will be able to complete the project in a shorter time, with greater accuracy.

Avoiding common pitfalls

There are a number of ways to classify the data> However, to get started, look for keywords in the Supplier Name and then the Description column.  The description of services could include ‘hotel, taxi, cleaning services, cleaning products, etc., however, it’s important to carefully check the descriptions before classifying, or errors could be introduced.  A classic example is “taxi from hotel to restaurant”, depending on which keyword you search for first, it could end up being misclassified as transport, or venue costs.

I wouldn’t advise classifying row by row, as it could take more than twice as long to complete the file using this method.  Start with keywords, followed by the highest value suppliers which you can get from a pivot table of the data if you’re working in Excel.

Identifying opportunities

Once classified, charts can be built to analyse the data.  The analysis could include, ‘top 80% of suppliers by spend’; ‘number of suppliers by category’; ‘unit price by product by month’;  ‘spend by category’; or ‘spend by month.’

Patterns should start to emerge which could reveal unusually high or low spend in a category, irregular pricing, higher than expected use of services, or a higher than expected number of suppliers within a category. 

Why you should strive for data accuracy and classification?

Data accuracy is an investment, not a cost.  Address the issues at the beginning: while it might seem like a costly exercise, you will undoubtedly spend less than if you have a to resolve an issue further down the line with a time-consuming and costly data clean-up operation.  And by involving the whole team or organisation, it will be much easier to manage and maintain the most accurate data possible.

Spend data classification shows you the whole picture, as long as it’s accurate.  You can get a true view of your spend, allowing improved cost savings, better contract compliance and possibly the most important – preventing costly mistakes before they happen.

So, does your data have its COAT on? What does ‘dirty data’ mean to you? Let me know below!

Susan Walsh is the founder of The Classification Guru, a specialist in spend data classification, supplier normalisation and taxonomies.  You can contact her at [email protected] https://www.procurious.com/professionals/susan-walsh

5 Barriers To Achieving End-To-End Supply Chain Visibility

Is it possible to get real-time, end-to-end visibility across your supply chain? Absolutely. But only if you have the right tools.


Since the term “supply chain” was first coined, we’ve all been searching for the holy grail: end-to-end supply chain visibility.

Now, as we recover from the initial shocks of the pandemic and manage through ongoing challenges, we need it more than ever.  But is total visibility actually possible? 

That was our question for Takshay Aggarwal, Global Lead Digital Supply Chain Partner at IBM Global Business Services.

Takshay and Procurious Founder Tania Seary recently talked about building resiliency in a disruptive environment.

A flawed strategy

Prior to the pandemic, a “just in time” inventory management strategy worked wonderfully well for most supply chains, but “just in time is only able to respond to certain fluctuations,” Takshay said. 

When the pandemic drove large-scale disruption, the strategy unravelled. Retailers, for example, were left with empty shelves, late deliveries, and no warning about shipping delays.

And it wasn’t just retail. Industries across the board lacked critical products because companies didn’t have visibility into their tier 2 to tier 10 suppliers – where 40% of supply chain disruptions occur.

Suddenly, companies were scrambling to change supply strategies. 

“The companies who have started on transformation journeys before COVID have fared much better,” Takshay said.

In fact, IBM’s visibility of its own internal supply chain meant it could predict the supply chain impact from the pandemic much sooner than most. 

Path to resilience

So how do you get that same level of visibility and resiliency across your supply chain?

It starts by asking the right question.

“[People should be asking] ‘what kind of supply chain do I need to have?’” Takshay said. 

That’s why the smart companies are re-balancing their risk appetite. 

A real control tower

A resilient supply chain is a transparent supply chain. And the only way to get that crucial visibility is having a smart control tower.

The concept of a control tower isn’t new. It’s a place to pool data from across your supply chain, and use it to make informed decisions.

The right tower helps you see problems a long way off, so you can minimise disruption and maximise profitability. 

But Takshay noted a worrying trend in procurement where any sort of dashboard is called a “control tower”. 

That’s a problem, since most inventory control towers are seriously limited. And you can’t make excellent decisions without knowing the full picture.

Takshay pointed to the IBM Sterling Supply Chain Control Tower as a huge development that finally gives companies the end-to-end visibility they crave.

Here’s how the sophisticated tower can help you overcome the five biggest barriers to visibility.

Problem 1) Most inventory control towers don’t work across silos.

A huge frustration is most control towers can’t handle all the siloed systems of today’s complex enterprises.

It’s a bit like depending on an air traffic controller who can only see part of the runway.

Takshay noted IBM’s control tower works seamlessly with ERP systems, warehouse management, demand planning, order management, e-commerce platforms, and logistics. 

You get one version of the truth across your entire inventory.

Problem 2) Most control towers only show you an inside-out view. 

It’s a big task to monitor operations across the supply chain. But you’re severely limited if your systems won’t sync up with your suppliers’.

That’s why the IBM Sterling Inventory Control Tower makes it easy to work across business partner network.

The result? You can make decisions with confidence, knowing you have all the external information you need.

Problem 3) Most tower controls can’t get into the nitty-gritty detail.

A crucial flaw in most control towers is they lack granular detail. That’s a pretty big issue when your job hinges on knowing the right details.

So instead of depending on people to enter the right data in the right place at just the right time, there’s a smarter way.

IBM’s control tower gives you the microscopic detail you need to make confident decisions. 

Problem 4) Most tower controls are inflexible.

A major drawback for most inventory control towers is the rigid structure. 

There’s only one way to input data, and don’t even dream of changing the architecture. But the pandemic showed us how fast everything can change and how flexible and agile your supply chain needs to be to respond effectively.

You need a control tower that can keep up with the reality of supply chains today. That’s why the IBM Sterling Supply Chain Control Tower is ideal. It adapts to fit your business needs – no matter how quickly they change.

Problem 5) Most control towers predict the future based on past events. 

If you don’t have real-time visibility across your supply chain, you are making decisions based on past events, Takshay said.

At the very least, a control tower should give you current information. But IBM takes it a step further with predictive capabilities.

The control tower looks for patterns in your data – flagging possible issues before they happen. That way, you can quickly adapt and avoid disruption.

Don’t wait for perfection

Control towers go a long way toward visibility and resiliency, but they aren’t a silver bullet, Takshay said.

So instead of waiting for perfection, start bringing your systems together now. 

“The more visibility and the more integration, the more resilience,” Takshay said. “You’re able to bounce back much faster.”

If you want greater supply chain resiliency, you need greater visibility.

And you’ll get that level of visibility if you choose a control tower that actually gives you control. 

Watch the full webinar – Building Resiliency in a Disruptive Environment: How Control Towers Make a Difference – for free >

How Some Strategic Sourcing Technologies Fall Short

Moving to a true strategic sourcing plan can bring increased efficiency and huge cost savings. But why do so many fall short of this? Technology is evolving rapidly making many once cutting-edge solutions obsolete. Finding the right fit can be a struggle – this article has everything you need to know about sourcing tech.


Strategic sourcing is not a particularly new concept, but the market is evolving rapidly. Applications have become increasingly sophisticated and in the near to medium term future we will see more strategic spend management via advanced analysis and AI-based sourcing with more “fuzzy” intelligence that increasingly guides the user to the optimum solution.

TechTarget defines strategic sourcing as follows:

Strategic sourcing is an approach to supply chain management that formalizes the way information is gathered and used so that an organization can use its consolidated purchasing power to find the best possible values in the marketplace and align its purchasing strategy to business goals. 

One reason that organizations often struggle to achieve true strategic sourcing is that the tools they are using, such as reverse auctions and eRFXs, which once represented the cutting edge of sourcing technology, are too limited in scope and lacking in integration, both with other procurement modules and with third party software suites. This is especially problematic when it comes to large events and bundling items in which there are many variables and business objectives.

In its recent Market Guide for eSourcing applications, Gartner Group identified four phases of the evolution of eSourcing:

Basic RFQ and RFI (request for quote/information)

This is where things started back in the nineties. Specifications had to be very precise and buyers generally sought the lowest price and/or best delivery availability. Early digital sourcing platforms were primarily designed for indirect sourcing of categories such as IT hardware, computers, office furniture and supplies, where there are multiple suppliers with little differentiation. This worked just as well for non-strategic direct categories (materials and components used in production). Purchasing teams could therefore shop around to find the fastest, cheapest option available, and so long as the tool could take into account cost breakdown models, resource costs, taxes, and one-time costs like setup and onboarding, there was a good chance that projected savings would be realized.

Standard eSourcing 

Standard eSourcing then built on RFQ capabilities to support more complex RFIs and RFPs (request for proposals). According to Gartner, “They are typically used to solicit supplier responses and pricing for strategic spend categories. Specifications may or may not be clearly defined.” At this stage eSourcing becomes more strategic, multiple stakeholders are included in the buying process truly creating a strategic team. The modules are increasingly deployed as part of an entire suite which also includes spend analysis, CLM and supplier management. Also, we see distinct solutions for indirect and direct (or bill of materials (BOM)) categories. As Gartner states, “more advanced analysis and capabilities require integration with PLM and BOM. This is often better suited for vendors that specialize in direct spend or those that support all spend categories.” 

These applications also typically support various auction formats, multi-round bidding, response scoring and proposal analysis. A further aspect is that the detail level of direct procurement requires special capabilities in software, and all of these needs to integrate seamlessly with the ERP/MRP system.

Advanced sourcing optimization (ASO)

ASO is the current state of the art for handling complex category bidding that must analyze large volumes of data points. This is best represented by JAGGAER’s Sourcing Optimizer, capable of analyzing thousands of data points using algorithms to determine the optimal award decision quickly. This makes it suitable for highly complex sourcing events such as multimodal transportation, where there are hundreds of potential scenarios and dozens of rules which buyers use to try to identify a “sweet spot” with the optimum number of suppliers for an optimum number of scenarios. Users do not always know exactly what they are aiming for in such events, as they need to navigate through complexities such as limited knowledge, tradeoffs and time limits.

Artificial intelligence in sourcing

AI-based sourcing is where we are headed. This emerging technology will integrate itself across all aspects of sourcing. In the coming years AI will transform sourcing and will have the ability to automate entire sourcing events. This will be a very attractive option for handling the vast majority of sourcing functions that are high volume-’low cost’ and can be accurately recommended from AI. This will free up professionals’ time to focus on the high value sourcing events as well as the larger sourcing strategy.

One direction that is already clear is the development of preference-based extensions to advanced sourcing optimization, enabling the user to add fuzzy preferences on top of the firm rules already entered. In a transportation event, the AI technology explores possible solutions to narrow in on the best options. The user can go through several iterations to get the ideal result. On top of this advanced decision support, AI-based sourcing will include increased automation, eliminating much of the routine involved in sourcing.

Sourcing for CapEx Events

We have mentioned indirect and direct sourcing, but capital expenditure projects offer a third type of sourcing event with dramatically different requirements. They are project-based, meaning that many different purchase orders and contracts need to be bundled together and tracked against a common project budget. Furthermore, these events are extremely complex and detailed, and they have long timeframes. Projects may last multiple years. Any sourcing platform for CapEx needs to be able to track events over time.

Capital expenditure projects also often involve many different supply bases in one project. Consider a building project that involves a concrete foundation, steel framing, glass work, electricity, and more. Then there’s paving for the parking lot and landscaping for the surrounding areas. It’s essential that the digital tool can track multiple types of expenses in one solution. Plus, many items might be sourced weeks or months in advance. The solution should support this kind of detailed project planning.

For all of these reasons, strategic sourcing is challenging for major CapEx projects. There is also ample scope for the integration of artificial intelligence to predict and reduce costs, schedule and reduce cycle times while increasing customer satisfaction and managing regulatory and CSR data. It is important that all providers should be compliant, and the sourcing process needs to capture this information. Having the right strategic sourcing approach and the appropriate tools to support that are vital.

What are your thoughts on how technology is creating an opportunity for more strategic sourcing? Let us know in the comments!

5 Telltale Signs Your Tech Is Failing

In times like these, all systems need to be firing on all cylinders, so how can you tell if your system is beginning to show it’s in need of optimization or replacement?  There are 5 telltale signs that suggest your tech is failing. 


The digital age marches on and it’s rare to find an organization that has not automated some or all of their procurement operation.  The business case for going digital in S2P is compelling, so it is critical that it works. 

Yet many organizations have tech solutions in place that no longer fit their intended purposes. Worse still, many have just given up and are settling for an inferior system that is not meeting their needs.

The signs are there, but they are either going unnoticed or they are being ignored. Both situations are perilous and without swift action, the cost to an organization in time and resources – and the immediate need for a new solution or an optimization – can really mount up.

What are the key signs that your tech solution is failing?

And how do you recognize them before it’s too late?

Here are some of the most common.

1.     User adoption is on the decline

Your tech may have been heralded as the solution to all your organization’s ills. And for a while it was exactly that. But now even the staunchest champions of the solution are withdrawing their support and end-users are finding ways to avoid using the system altogether.

End users are reverting back to picking up the phone to place orders or finding other ways to go around the system.  This will result in more spend going through P-Cards without prior approval and/or more invoices showing up that are not tied to a PO. 

Decreasing adoption is one of the key signs that your tech is failing, and that action needs to be taken. Once users are working around the system, any efficiencies the solution offered are being lost. And it’s probably costing you more to keep things running.

Close communication with end-users is a good way to track ongoing performance and opportunities for optimization. 

2.     High end-user support rate

Your end-users will also be able to tell you when the solution is failing when it comes to usability. A clear sign will be when the rate of users seeking system support begins to increase and where tasks become increasingly difficult to perform.  Especially with your more infrequent users of the platform. 

When this happens support tickets will increase and if they are not resolved quickly, end users will lose confidence.  When that happens, tickets may decline, but not for reasons that are good.  as end users will typically turn to work arounds. 

The most common work around is sending requests via Free Form requests to the buyers to complete for them.  If your buyers are spending more than half of their day chasing down requisitions, you have a problem that needs to be corrected. 

The second most common work around is the use of a “Power User.”  This is when departments or locations turn to one person to complete all of their requests on their behalf.  This was common in the days of ERP requisitioning systems, but not today.  Especially when P2P systems of today have user interfaces that resemble what they have at home. 

If any of these work arounds are happening, your tech may have seen better days and has become dated and too cumbersome to work with.

Communication with end-users is key again here. You want to be able to have a continuous feedback cycle to raise issues before they start impacting operations. It will help to identify any bugs to be fixed and create a forum for new feature requests.  What you learn may surprise you. 

Which brings us to the next telltale sign.

3.     Lack of New Innovation

You’d expect your tech solution provider to be leading the pack in new features and improving your overall user experience to create even more value for your organization. 

If you’re not seeing these, it is time to start asking questions of both your system administrator and your software provider.

Being a system administrator can be hard work, especially when there are 3 new releases per year to keep up with.  If you are not seeing new features/functionality it may be that your system administrator is overwhelmed. Since new features come to you in the off position, you may have new features that have never been turned on. 

If that is not the case, and your solution is not keeping up with other S2P providers, then it’s a clear sign that your provider’s focus is elsewhere or they built their platform on a system architecture that is difficult to develop new functionality.

Both situations should be a red flag to your organization. You should set the wheels in motion to optimize what you have or determine if it is time to test the market for a new tech solution.

4.     ROI less than expected

Before you started out on this journey with your chosen provider, you created a detailed business case of what you expected in terms of outcomes from your new tech solution. You probably broke out the soft costs from the hard costs and knew what processes the tech would help to improve and how it would increase efficiencies in your organization.

These expected benefits – hard dollar savings, employee time, resources and removal of unnecessary or duplicated processes – could be quantified with a monetary value. This, in turn, allowed you to calculate your ROI. 

However, as time has gone on, it’s become clear that the level of expected benefits isn’t being delivered. The ROI for the solution isn’t being met and it’s time to understand why. There could be a number of factors (including the items on this list). But all of this is a further sign that your tech solution is no longer fit for purpose.

5.     Wandering solution roadmap

Even The Beatles had a ‘long and winding road’, but they at least knew the destination that awaited at the end.

Your technology journey may not have an end point by its very nature, but it should at least have clear direction. This would have been identified at the outset of your selection process, complete with clear goals and initiatives, helping to determine which technology solution would be selected.

Years later you may find that what was once their focus is no longer.  Maybe you selected your tech provider due to their commitment to your industry or their commitment to a certain product road map.  It is not uncommon for plans to change and for tech companies to change their focus for a variety of reasons.  Is this enough reason to leave and start looking elsewhere?  If it were up to me, that would depend on how many other items are on this list that are currently plaguing your operation as these issues may be related.  If they have changed direction and are focusing on industries and organizations that don’t resemble you, it may be time to start looking elsewhere before things start getting worse. 

Now you’ve seen the list, do you have any signs of your own to add? Anything in your organization that might now seem like a warning sign? These signs may not be immediately obvious which is why it is so important to know your KPI’s and be measuring what matters. If you don’t have anything in place, your solutions provider should be helping with this with a strong roadmap and support.

So keep these signs of a failing tech system in mind. You should then be able to avoid being encumbered with an ailing solution and instead remain as close to the cutting edge as you can.

Navigating The Next 150 Days: Three Experts Share How to Strengthen Supply Chain Defenses

Three procurement experts share their strategies for mitigating supply chain risk during the second half of 2020.


The Economist put it best in early July: “You may have lost interest in the pandemic. It has not lost interest in you. COVID-19 is here to stay. People will have to adapt. The world is not experiencing a second wave: it never got over the first.”

This reminder rings true for procurement and supply chain leaders.

Thankfully, we are more than halfway through this disaster of a year called 2020. Let’s take stock of where things stand: At the outset of the crisis, 97% of supply chains were affected. Since then, the global supply chain has stabilized, but remains vulnerable. The virus continues to spread and economic uncertainty remains. But are we on the path to recovery? 

“It’s hard to say if we are in recovery or not,” says Nick Binks, General Manager Contracting and Procurement for Woodside Energy. “The initial crisis has passed, but we have not fully recovered. We expect to see new hurdles and obstacles pop up in our supply chain.”

riskmethods, a supply chain risk management provider, recently analysed all the risk indicators for the first half of the year. What they found was telling: In May, there was a decline in every type of supply chain risk they monitored, which cautiously signalled the start of a turnaround.  

The keyword there, of course, is cautious. riskmethods also found that the percentage of pandemic-related threats in May was still higher than January or February 2020.

“This crisis is far from over,” said Bill DeMartino, Managing Director for riskmethods North America. “The next few months are critical for building up supply chain defenses to protect against the next wave.”

Procurement’s Second Half Focus: Supplier Health and Risk Awareness

What’s the best way for procurement and supply chain leaders to strengthen defenses through the end of 2020?

Naomi Lloyd, the Director Procurement Asia Pacific for Campbell Arnott’s, recommends keeping a pulse on the big picture. “Be conscious of the entire market. You may be experiencing strong demand now, but someone else in your network may experience a drop in demand or disruption. Everything is connected,” said Lloyd.

DeMartino agrees: “Determining your critical supply chain dependencies is a must during the recovery process.”

The financial roller coaster we’re experiencing also bears watching. According to riskmethods, financial distress of suppliers was 105% higher in May than at the beginning of the crisis, signaling there’s more damage to come.

“Getting an accurate read on supplier health is always a challenge. Traditionally, we would qualify a supplier’s financial viability, and then set it and forget it,” said Binks. “Now we are regularly checking and monitoring.”

Becoming a more risk-aware enterprise is an essential step in the recovery and resilience process, according to riskmethods. Supply chain and procurement leaders can take different steps to make that happen, depending on what their business is experiencing right now. Specifically,

–          During crisis, dedicate additional resources to risk management

–          During recovery, expand the importance of risk in decision making

–         While operating in the new normal, elevate the role of risk preparedness by uniting stakeholders across the enterprise

“Risk has always been a KPI on our procurement scorecard, but pre-COVID, no-one really took much interest in it within the business,” said Lloyd. “Now, risk management has been elevated. We’re holding weekly cross-functional meetings to openly identify and discuss what’s happening on the risk front. Procurement leads these meetings, but everyone is involved: quality, engineering, planning, operations, finance, R&D, sales, and more. This puts risk front and center for everyone.”

The next five months will fly. The onus is on procurement and supply chain teams to ensure operations don’t crash.

Listen to Bill DeMartino, Nick Binks, Naomi Lloyd and Tania Seary in our latest webinar – The Risk Report – Now streaming in the Supply Chain Crisis group

5 Outdated Myths About Blockchain

Is there a compelling reason to use blockchain in the supply chain? We separate fact from fiction.


The supply chain profession is no stranger to blockchain. 

In fact, a survey this year of supply chain professionals showed 80% are familiar with blockchain – a whopping 21% increase on last year.

And almost half of respondents plan to invest in blockchain over the next two years.

Yet for all the ways blockchain is modernising the supply chain, some still view the technology with a healthy dose of scepticism. There’s still a great deal of room to establish what role blockchain plays. Its place in the supply chain toolkit still isn’t fully defined.  

And that leads to ongoing misconceptions.

It’s time to bust some of the myths surrounding one of the most coveted 4.0 technologies.

Fixing weaknesses

Widespread disruption highlighted issues that already existed in the supply chain.

One of the most apparent issues is paper documentation for important processes and transactions. 

Important documents like Bills of Lading and Certificates of Origin are still largely paper-based.

Yet, these documents are often late to the destination port, or even lost – costing businesses $200 billion each year (World Bank).

So why do we still use paper? Because we don’t trust each other, according to the University College London Centre for Blockchain Technologies (CBT).

“Despite…strikingly obvious inefficiencies of paper documentation for international trade, it is still considered to be the industry standard, largely due to lack of trust between different members of the international supply chain,” the CBT notes.

Luckily, blockchain technology could solve this and other trust issues that make it hard to do business internationally.

Blockchain allows companies to track products throughout the supply chain using digital, unchangeable records.

[Need a quick blockchain intro first? We’ve got you covered ]

“A panacea for our ailments”

It’s the logical solution, especially in today’s economy, says Professor Olinga Ta’eed from Birmingham City University.

“Covid-19 has highlighted a crisis of trust in countries, people, organisations, products, and processes,” he says.

“Blockchain has features that do not require trust to operate effectively. Decisions are automated and not dependent on personal relationships, politics, or bias.

“It is thus a panacea for our current ailments, both immediate, but also structurally in a future society.”

Enter blockchain

That might seem counterintuitive. After all, how can a system that doesn’t require trust actually improve trust?

The beauty of blockchain is everyone across the supply chain can access the same information at the same time. They can be confident the information is verified and unchangeable. Just what we all need in this brave new world.

Using blockchain technology lets you track in real time:

·  Where goods are

·  Their physical condition

·  Changes made during the transaction lifecycle

·  Who or what is causing a delay

·  The quality and authenticity 

·  Discrepancies in transaction documents

·  Contractual terms and conditions

That equal access to information fosters trust between business partners. And you can build a lot of great things from a base of trust.

Trust is something we sorely need. So, what’s keeping companies from adopting blockchain more widely?

There is still a lot of misinformation circulating about the technology.

That’s why it’s time to stamp out five of the most common blockchain myths:

Myth 1) Blockchain is bitcoin

One of the biggest scepticisms about blockchain is rooted in its links with bitcoin.

Bitcoin and blockchain are NOT the same thing. Bitcoin is a form of ‘cryptocurrency’. It was invented in 2009 as a way to store value without relying on a central authority (like the government).

But it couldn’t work on its own; it needed new technology to make it work, so blockchain was invented.

That’s how the two are related. Blockchain is the engine that makes the bitcoin car run, but just as you can use an engine in lots of things besides a car, blockchain has more applications than just bitcoin.

Companies are taking advantage of the proven strength of blockchain in solving new challenges beyond financial.

In fact, one of the most celebrated uses of blockchain technology is in supply chain management.

Take the retail giant Walmart, which uses blockchain technology through the IBM Food Trust to track produce from farm to shelf.

The retailer can now trace the provenance of produce in seconds, instead of days. And Walmart certainly isn’t the only one interested in traceability.

Gartner predicts that by 2025, 20% of the world’s top grocers will use blockchain to track food safety.

Pharmaceuticals is also a key area for blockchain technology.

The United States Food and Drug Administration recently finished a pilot programme tracing the full supply chain of prescription drugs using blockchain. The results? It now takes two seconds to track a drug instead of 16 weeks.

And quick thinking during the pandemic led to creation of IBM Rapid Supplier Connect.

It uses IBM’s blockchain network to help government agencies and healthcare organisations source reputable equipment from new, non-traditional suppliers.

As Jason Kelley, General Manager of IBM Blockchain Services, put it: “Finding, vetting and then securing new suppliers takes time, more time than the public authorities and private sector can afford.”

The system allows new vendors to be onboarded in as little as 30 minutes.

“[We] help members of these essential supply chains continue to find the vendors, materials and tools they need so that time and attention can be focused on addressing the current and ongoing requirements as a result of this pandemic,” Kelley says.

Myth 2) Blockchain is only useful for projects that are massive in size and scale

Blockchain makes obvious sense for global retailers with thousands of suppliers.

But what about for smaller companies?

Yes, and it’s a lot easier than you might think to get set up on a blockchain network.

The bulk of supply chains rely on point-to-point communications. Blockchain makes it simple to collaborate using many-to-many communications – giving you a single version of the truth.

That’s something that companies of all sizes need.

And it’s even more practical now that there are blockchains built specifically for enterprise use.

Like IBM’s blockchain network Trust Your Supplier, created in partnership with consultancy Chainyard. This private network delivers the ultimate in supply chain transparency, as buyers and sellers can all access the same end-to-end data in real time.

It eliminates time-consuming admin, like trying to verify supplier identities and track documentation.

Through Trust Your Supplier, businesses of all sizes can validate and onboard suppliers in a secure and efficient way.

Myth 3) It takes a long time to get suppliers set up

Many companies like the idea of blockchain, but they worry about the time and effort of getting suppliers set up.

The reality is it can actually be quite fast.

For example, IBM lets you onboard suppliers in hours versus days or weeks to a permissioned blockchain relationship.

And as we all know too well after recent disruption, speed is everything.

Once set up, companies see quick returns on investment through visible deliveries, reconciled invoices, and better return management.

And not to worry – no advanced computer programming degree needed. Your enterprise blockchain supplier can walk you through the entire process of getting on the network.

Myth 4) You have to abandon systems you already have

Another common belief is you need to throw out all your existing supply chain management systems if you use blockchain technology.

Not necessarily. As IBM puts it, “We believe that traditional methods like EDI, when complemented and extended by emerging technologies like Artificial Intelligence (AI) and blockchain, will be the fastest path to realizing a new era of B2B transaction efficiency gains.”

It’s possible through technology like IBM Sterling Transaction Intelligence Multi-Enterprise Edition. It helps companies leverage EDI investments by bringing important documents into a shared blockchain, giving different parties the same visibility. 

So it’s totally possible to see a fast return on investment without scrapping your current processes.

That said, you may want to consider if your legacy systems are really serving your needs, advises Jack Shaw, a technology futurist and leadership speaker.

“I think most business professionals are far too concerned with trying to use their existing tools, technologies, and processes to solve their immediate, short-term problems to think about how blockchain…could actually help them do their jobs much better both now and in the long-term,” he says.

“This is really a strategic shortcoming as they should be thinking about how the current pandemic necessity could be the mother of innovation, leveraging emerging technologies for strategic benefit.”

Myth 5) There is only one blockchain network

There isn’t one central blockchain network that everyone uses.

There are actually several different types of technology that go by the name ‘blockchain’, and there are public and private blockchain networks.

In public blockchain networks, like the ones used by bitcoin, the data is open for anyone to access. The transactions are still unchangeable, but they are visible for scrutiny.

On the other hand, there are private blockchain networks, like the ones used by IBM enterprise clients. You can place restrictions on who is allowed to participate, and anyone who wants to join needs your permission.

That gives you tighter control on who can see what, while still maintaining transparent records.

Is it time for blockchain?

For all its benefits, blockchain will not magically solve all supply chain issues overnight.

But the ability to strengthen, connect, and improve the resilience of supply chains will be key to recovering from the pandemic, according to Mariam Obaid AlMuhairi of the Dubai Future Foundation.

“If there were any lingering doubts over the value of blockchain platforms to improve the transparency of businesses that depend on the seamless integration of disparate networks, COVID-19 has all but wiped them away,” she said in an article for the World Economic Forum.

“We should look at this healthcare crisis as a vital learning curve that can show us how to build transparent, inter-operable and connective networks.”

For more Industry 4.0 talk, join the conversation in our Supply Chain Pros group

Storm Warning: Where Is Supply Chain Risk Management On Your Radar?

If there’s one thing this crisis has taught us, it’s how quickly things can change overnight. Don’t think we are out of the woods, just because supply chain risk has declined. Our community has never been more vulnerable.


After spending half of 2020 fighting off the virus in more ways than one, it seems as though we’re becoming immune to its detriments. Yet, as our Supply Chain Confidence and Recovery Index revealed, there’s still a great amount of looming uncertainty. Despite the recent universal decline in supply chain risk, our community has never been more vulnerable.

Publication of our Supply Chain Confidence Index, quickly followed by riskmethod’s Risk Report has created a “perfect storm” of data to show that now, more than ever, we need to be vigilant and proactively address supply chain risk.

Aside from the obvious pandemic outbreak risk increase, which riskmethods reports is 34.7 times that of 2019, changes are impacting virtually every aspect of business. Some of which include:

  • A major increase in cyber security risk-related warnings, stemming from the transition to working from home
  • Substantial growth in risk associated with labor practices and human rights, as well as employee stability
  • A 26% increase in natural hazard risk

And with lack of visibility into supplier and geographic risk topping the list of lessons learned from COVID-19, it’s clear our job here is not done.

Putting out the fire  

The lack of visibility, data and agility acted as an accelerant, enabling the disruption to spread like wildfire from supplier to supplier. Procurious found that:

  • The hardest-hit companies were more than 50% likely to have multiple key suppliers go out of business due to COVID-19  
  • 30% of CEOs had a supplier declare Force Majeure
  • 65% of organisations were forced to source alternative suppliers for affected categories

Consider all the ‘prepare for the second wave’ and ‘the worst is yet to come’ talk a storm warning. The weatherman may not be 100% accurate, but it’s almost always a matter of when and to what extent, then whether it will happen at all. We need to keep supply chain risk on our radar.

Not only did our research indicate supply chain and procurement leaders are still bracing for peak impact, the riskmethods 2020 Risk Report predicts more damage to come, as supplier financial distress risk was 105% higher in May than the beginning of the crisis.

Most economists expect a second wave of bankruptcies – with one recognised expert predicting the amount of large bankruptcies (at least $100 million) will challenge the record set after the 2008 financial crisis.

So, how do we avoid another disaster? This year, riskmethods reported a 34% increase in early supply chain disruption warnings compared to the same time period in 2019, including: 

  • A 151% increase in disasters at partner sites
  • A 100% increase in disasters at location
  • A 45% increase in instability in key employee positions

This urgency placed around supply chain risk management should not be viewed as negative. The newfound spotlight gives our profession the spotlight we need to expedite critical decision making and drive real change.

While the extent of the impact of COVID on our supply chains is no longer surprising, the disruption offers a clear and urgent call-to-action for global organisations to rethink and rebuild supply chain risk management strategies from the ground floor.

Our Index showed that failing to invest in SCRM was the No. 1 technology regret during COVID-19. The majority of respondents (73%) are planning significant procurement and supply chain strategy shifts. For many, this means increased investments in supply chain and procurement technology. The emerging and Industry 4.0 technologies that show the most promise for mitigating future supply disruptions include:

  • Predictive analytics
  • Machine learning
  • Robotic process automation
  •  Internet of Things
  • Additive manufacturing and 3D printing
  • Blockchain

We still have a long way to go before we even determine what ‘business-as-usual’ will look like—never mind reach it again. And when that happens, remember: the worst thing to do when it comes to supply chain risk management is nothing at all.

Join us and riskmethods on Tuesday, July 28 as we reflect on lessons learned and continue crowdsourcing confidence with fresh data from the frontlines. Register now.

What Are The Most Valuable Tech Skills In Procurement Right Now?

The future of procurement is digital. Experts share the tech skills you need to thrive in that future.


The future of procurement is digital. How can you make sure you’re part of that future? By understanding what your company needs from procurement, then using the right digital tools to meet those needs.

Here are the most valuable tech skills in procurement:

Supplier risk management

Companies want better supplier risk management, especially in the wake of COVID-19.

Our recent Supply Chain Confidence Index showed 27% of respondents didn’t have the tools they needed to act quickly in the crisis.

That’s why supplier risk management technology is top of procurement leaders’ list of digital priorities.

Employers now expect procurement teams to move faster and mitigate risk long before another crisis hits.

End-to-end supply chain visibility

A by-product of proper supplier risk management is increased visibility, according to Hau Lee, Professor of Operations, Information and Technology at the Stanford Graduate School of Business.

“You need end-to-end visibility about your supply network (capacity, inventory, disruptions, production yields, lead time, bottlenecks, social and environmental performances, their financial conditions, etc.), and your demand network (orders, demand forecasts, backlogs, channel inventory, promotion plans, and disruptions),” Lee says. 

There are a host of tools out there to improve visibility. One is IBM Sterling Inventory Visibility, which is a cloud-based Software as a Service (SaaS). It compiles all of your inventory information from different platforms so you can see available product in real-time.

That’s just one example. Lee recommends educating yourself about other available tools that improve visibility. These harness technology like the Internet of Things (IoT), machine learning, and deep data analytics.

Reduce complexity in global sourcing

Professor Lee says understanding the intricacies of global trade, and how technology can reduce complexity, can make you an extremely valuable asset.  

“Today, you need to be aware of the tens of thousands of bilateral trade agreements that exist between some key trading countries for products and components that may affect you,” Lee says. 

And not just for minimising disruption. Where and how you source products can have a major impact on your bottom line.

Lee uses the example of breaking up a product and sourcing parts from different countries, like sourcing frames from Cambodia while the other parts from China. That way, you can use Cambodia as the country of origin instead of China, which can save you a great deal in taxes and custom duties. 

“As countries start to gradually recover from COVID-19, attention will be shifted back (it has already started) to trade wars, tariff frictions, and protectionism,” Lee says. “Databases from WTO, for example, should be useful. Some experts call this “tariff engineering,” and there can be big differences.”

Conduct due diligence on suppliers for complete transparency

Ethical sourcing is already a hot topic, and it’s even more scrutinised now. Your company’s reputation is on the line, and you are held accountable for how and where you source materials.

It’s certainly a top concern for your company’s executives. They desperately want assurance that suppliers are reputable. Luckily there are digital tools that help you do your due diligence for potential suppliers, Professor Lee says.

“For example, many big brands have already been using IPE, the Chinese website that captures environmental violations in China, as a source of data to do due diligence of their prospective suppliers,” Lee says.

In fact, companies like Nike use apps to connect with the factory workers and educate them, Lee says. “[That] allows them to have better visibility of the conditions of the factories (instead of just relying on imperfect factory audits to monitor), and at the same time help to improve productivity there.”

Interpret data in a meaningful way

Being able to understand and interpret data is sorely needed in procurement.

This is especially true before you bring in new tech systems, says Susan Walsh, Founder of The Classification Guru.

“An area that’s often neglected is data preparation or cleansing before the implementation of any new software or systems,” Walsh wrote in a recent blog. “By the time it’s discovered there are errors in the data, staff have lost faith in using the software and are disengaged, claiming it doesn’t work, or they don’t trust it because it’s wrong.” 

Research from Deloitte shows CPOs struggle with an organisation’s data complexity. If you can untangle data and whip it into something meaningful, you’ll have a job for life.

Step away from the admin

The beauty of procurement technology is cutting out admin and simplifying processes.

The ugly side of that same technology is displacing people who currently handle that admin. That’s why you need to gain useful skills beyond manual data processing if you want a future in procurement.

But where do you start, especially if new technology seems overwhelming?

Craig Carter, Professor of Supply Chain Management in the W. P. Carey School of Business at Arizona State University, says start with the basics.

“Supply management professionals need to have a general understanding of all of the technologies that are being adopted or are on the horizon – AI, blockchain, descriptive analytics, and predictive analytics,” Carter says.

But don’t panic, as Carter adds that understanding does not mean mastery. You don’t need to become an expert overnight.

Technology is coming

Don’t be surprised if this future tech is on your desk a lot sooner than you think. The pandemic has only accelerated the adoption of technology, as shown by our Supply Chain Confidence Index.

When asked which technologies show the most promise for helping to mitigate future pandemics and supply disruptions, 49% said predictive analytics and 38% said AI/ machine learning.

Ultimately, companies will do anything they can to minimise risk. Which is why procurement is so perfectly placed to contribute.

All you need to do is prove you have the answers they need, says Professor Carter.

“What is necessary is a demonstration of a procurement professional’s strategic value,” Carter says. 

“Procurement professionals who can critically analyse, think strategically, and build relationships will continue to be in demand.”

Join Procurious to connect with 40,000 other ambitious procurement professionals and get free access to networking, industry news, training and much more. 

Five Steps To Become A Procurement Tech Champion

Upgrading your team’s procurement processes is daunting. This guide will help you choose the right tech solution and make your project a raving success


So you’ve had the same procurement system for years. Or Covid-19 may have exposed just how unsustainable paper and manual processes can be?  Is the status-quo no longer enough?

Maybe you’re thinking this is your chance.  Supply Chain is now front-page news and the talk of your C-Suite. Within this new climate, leaders are questioning whether they have the right people, the right tools, the right processes and the right model for success.   How many of the shortcomings of your group would have been mitigated or eliminated if you had the right tools? 

Is it time for a small refresh, like a new Source-to-Contract platform?  Or maybe you’re after something bigger – like a complete Source-to-Pay system.

No matter the scale of change, more organisations are choosing to mitigate their risk and ensure success with completing a Success Blueprint prior to going to contract with their new tech.

After all, you don’t want to be part of the 33% of IT software projects that overrun on time, or the 66% that overrun on budget.

Luckily, we’ve got advice from expert Matt Stewart, Founder of RiseNow. He’s helped over 200 companies implement procurement systems, so he knows exactly how to make your change a success.

Here are your five steps to conquering an upgrade in your procurement tech.

1. Decide if it’s time to replace your existing system

If your users and suppliers have turned against your platform and are refusing to adopt due to usability and/or its inability to address their most important use cases, it may be time to move on.  For other organisations it may not be as bad as it appears.  If that is the case, don’t get caught into thinking the grass may be greener if it is possible to make some tweaks to configuration, redesign some processes, and reinvigorate your end-users with some proper training and change management. 

Be careful who you listen to as you seek advice and counsel on what you should do.  Make sure you align with a true advocate that isn’t trying to just sell you more software that you don’t need.  Also make sure they know your industry, use cases,  and are experts in the S2P/P2P space.  

We will be going into much more detail later in our Major Tech Fails series on how you to know when it is time to replace vs. Optimize what you have in “How To Know When It Is Time To Replace Your Tech.” 

2. Build a blueprint

You’ve compiled a list of absolute requirements, extensively searched the market and gathered feedback from key staff and stakeholders.  You feel confident that you’ve landed on the best solution for your business… right?  Maybe not.

Success stories start early on, well before contracts are signed and implementation begins.  Too often, organisations are lured in by the solution that provided the best demo, had the most eye-catching features, or offered the lowest price-tag, as we talked about during “How To Avoid the 5 Most Common Tech Mistakes”.  The trick to avoiding these obstacles?  Knowing about them in the first place. 

A RiseNow Success Blueprint accomplishes just that.  A success blueprint, or what others called a Pre-Engineering Study or Phase 0, is our proven process that brings alignment between all parties before you hit the ground running  It gives you the ability to anticipate issues that are likely to occur in the implementation and allows you to plan in advance to prevent delays and cost over-run situations.

By actively managing risk, you can set your project up for success.

3. Justify your case for change

Investment in a new tech solution is not something an organisation takes lightly.  To make your tech solution attractive to your CEO you’ll need a compelling business case.  But if you’re relying on the post-implementation phase to demonstrate that efficiency is actually being achieved, it’s probably too late.

You need to be clear from the start about what your organisation needs in terms of return on investment and decide exactly how you will report on the measurements that will demonstrate positive ROI.  Measure what matters.

Begin with knowing and owning every number in your business case.  Take time upfront to fully identify realistic savings opportunities by critical area and to quantify costs, both during the implementation and post go-live operating costs that may require more research to confirm. 

Follow these steps, plan to measure what matters, and when the time comes to defend your case for investment you can more easily defend it.  Your executive team will have the detail behind the numbers to fully buy-in, and you’ll have built an implementation plan that is realistic, predictable and achievable. 

4. Put it to work

You’ve secured the resources you need, built your blueprint, selected your perfect tech and proven your business case.  Ready to put your new solution to the test? 

Remember that implementations are ongoing projects, not just business as usual.  Implementations are all about people, decisions, and level of commitment.  Whether it’s end-users, suppliers or partners in the business, new tech has an impact on their everyday functions.  You want stakeholders engaged, informed and excited.  Make sure to weave your “why” into every stage of implementation.

Don’t underestimate an investment in change management.  A tailored communication strategy, understanding of stakeholder impacts, and a solid training approach can drive effective adoption.  Getting in front of detractors and people with concerns is one of the most effective ways to reduce resistance and concerns.  Focus on continuous improvement and keep in mind that no tech solution will be 100% perfect. 

Change happens because of people – not despite them.

5. Prove it

It’s finally time to prove the value of your new procurement tech and report back on your ROI.  Refer back to your criteria for success.  Through these previously identified KPIs and value targets, create dashboards and reports that are easy to visualize.  Note how your organisation has clearly benefitted, archive deliverables and adjust.

Retaining buy-in is critical to the ongoing success of your implementation.  Bear in mind that some pain points and aspects of your business process will always remain, no matter your tech.  Having a realistic approach to what and when you’ll deliver will put you on the path to success.

We cannot ignore the current climate; Covid-19 has forced risk avoidance to the forefront of KPI tracking.  The agility of your supply-chain will become an increasingly important measurement.

Times of crisis create opportunities for growth.  Organisations that capitalise on these opportunities, using them to invest in their people, processes and technology, will stand out. 

So once more, maybe this is your chance.  What kind of leader will you be?

Join us for our upcoming webinar – Major Tech Wins – where we joining forces with RiseNow’s Matt Stewart to chat with CEO of Supply Chain Sherpas, Joe Walsh, Director of Digital Procurement at PPG Industries, Michelle Welch, and Procurious’ Helen Mackenzie. Register here for your free digital ticket.

A Rare Opportunity To Reset And Accelerate

Will businesses go backwards due to necessity and survival or will they step up and push forward to go further and faster to achieve the right balance?


Many of us are in a post-covid state of mind, I most certainly am. But will you and your organisations come out of this stronger, weaker or just different? Of course, the crisis is still very much real, affecting many people and businesses with long-lasting effects.  Perhaps there are slight signs of a slow down in certain parts of the world but who really knows how things will fare without a vaccine. Either way, we have to overcome this and look towards the new normal, which I believe can be a better one.

The pandemic is surely one of the greatest affecting the world and for many it has or will be a pivotal turning point. On the personal side, it may bring focus back to the things that really matter, be it family and friends or health and lifestyle. Or, it may send you down a new path. On the business side, it may question the raison d’être and bring focus to finding the right balance between society, the environment and the economy. From certain perspectives, the pandemic presents businesses a rare opportunity to accelerate on digital transformation initiatives that have been dragging over the last few years. Not for the sake of digital transformation but rather to rapidly ensure more resiliency and hone in on or further develop competitive advantages.

Who better to bring balance, build resilience and solidify competitive advantages than Procurement and Supply Chain.

Balancing the Imbalanced

Until recently it would have been fair to say that most businesses operated in an imbalanced manner with regard to society, the environment and the economy. With the main focus being on economic development, too often at the cost of society and the environment. Of course, there have been big strides made in recent years to balance this out but the big question is – What Happens Next?

This is a pivotal point. Will businesses go backwards due to necessity and survival or will they step up and push forward to go further and faster to achieve the right balance? I do hope it’s the latter and guess what, I believe Procurement is a key player in this. How you spend can transform your business and beyond. Where a business directs its spend can make the difference between an unsustainable imbalance and a sustainable balance to develop society, the environment and the economy equally. I strongly believe (and hope) we’ll see more and more organizations taking a stronger stance on this issue. Be it stronger support or stricter policies around supplier management for sustainability and diversity or more efforts to improve the communities involved in and around a business. Overall, Procurement organisations can influence entire ecosystems of suppliers to develop with this balance in mind.

Building Resilience

Resiliency has always been an important business strength but naturally during times of crises, there is more focus on this. For Procurement and Supply Chain leaders, while this is very likely not a foreign concept, it is likely that they have not had the opportunity to fully execute on a strategy to be more resilient to external events. This is the opportunity to show real business value. Now is the time to show the business how Procurement can add value around supplier risk management, new sources of supply, changes to contractual arrangements and much more.

Building resiliency begins with suppliers but must involve collaboration with the business. How much information do you have on your suppliers? How well connected are you to your suppliers? Are you monitoring risk across your suppliers? Do you have a mechanism to communicate and collaborate with suppliers in times of crisis? Do you have a clear view of supplier hierarchy to understand parent / child relationships? Do you know who your suppliers subcontract to? The list of questions that need answering is long. Needless to say that Procurement must accelerate on its plans to digitally connect to its suppliers to get better information, better assessment of risk (and performance) and overall infuse the multitude of Procurement and Supply Chain processes with better supplier information to improve decisions.

Solidify A Competitive Advantage

Lastly, the opportunity to establish or further develop a competitive advantage is too great to ignore. Some may ask, how can Procurement help here? We have seen first hand from our customers that Procurement does, in fact, have a lot to contribute in developing a competitive advantage. There isn’t an easy answer, however, as it really depends on the business and industry. We have a leading telecom customer where procurement was instrumental in generating significant revenue. Another where Procurement impacted the financial performance of the company by launching more new products, faster and more profitably.

Procurement is a gateway to probably the most significant source of innovation that any company has, its suppliers. By harnessing this rich resource companies can build great competitive advantages but they also need the people, processes and technology to take full advantage.

Technologies such as strategic sourcing, procure-to-pay or full source-to-pay that are instrumental in managing spend must empower versus limit. Often however, software solutions are designed in a way that forces organizations to compromise due to the limitations and restrictions presented. For those organizations that are ready to develop a competitive advantage (and many won’t be, as they still need to attain a level of maturity), technology must empower the skills and ideas that people have to be implemented and executed. Technology must empower creativity, this is how a competitive advantage is both born and executed.