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Procurement Process Technology: 3 Keys To Adding Clarity Post Covid-19

Here are three keys to conceiving, deploying and using technology to elevate the performance of your procurement process operations from IBM’s Chander Vashistha


Procurement organisations depend on technology to manage their source-to-pay (procurement) functions most efficiently and effectively. Technology also provides exceptional services experience to their requestors, buyers and suppliers. However, organisations often find the process of selecting, implementing and using technology platforms and applications challenging. While procurement technology provides many benefits, organisations that do not select the right technology, integrate the technology to create a connected ecosystem and create processes to use the technology often do not realise the full benefits.  

Clarity is the cornerstone of successful procurement practices, and procurement technology must support and enable clarity between both parties. When organisations do not receive full value from technology systems, the issue often comes down to clarity. However, it’s essential that clarity exist before adding in the technology. Technology doesn’t create clarity, but improves and enhances clarity already present in the process.

Organisations with good clarity in their procurement practice see significant competitive advantages, business continuity, resilience and digital transformation. While these aspects are essential for a successful business, the COVID-19 pandemic and resulting business disruption significantly increases their importance.

Here are three keys to conceiving, deploying and using technology to elevate the performance of your procurement process operations:

1) Align the purchasing strategy with operations and vision

When organisations lay technology on top of disconnected strategy and vision, the new platforms and systems often magnify the misalignments. Before focusing on technology, organisations should review their current strategies to ensure alignment. A well-connected procurement strategy and vision drives implementation of a frictionless technology ecosystem rather than a patchwork collection of discrete point solutions.

The purchasing process works within both your procurement process and overall company operations. On an even more granular level, the purchasing strategy tightly connects with procurement operations’ vision and procurement operations strategy. Before making changes, especially in processes and technology, practitioners must step back and consider strategic alignment.

After understanding your organisation’s purchasing strategy, procurement vision and procurement operating strategy, the next step is ensuring they all align with one another. After making any necessary changes, your organization will have the foundation to begin looking for technology that supports all three.

2) Understand the four types of procurement technology

Procurement professionals often assume — incorrectly — that all procurement platforms and systems fall into a single category. By understanding the different types, organisations can ensure they are researching and purchasing the best type of technology for their needs. Without clear understanding of the different types of procurement technology, organisations may purchase multiple technologies performing very similar functions, which creates waste and redundancies, not to mention wastes funds.

Procurement organisations use the following four types of technology:

  • ERP software and blockchain equivalents – SAP-MM, SAP-FICO, TYS blockchain, IBM Temp labor blockchain and RSBN blockchain
  • Commodity or process-neutral procurement technology – SAP Ariba Solutions, Coupa, Tradeshift, Sourcematrix and IBM SpendIQ
  • Commodity or process-specific procurement technology – IBM Oniqua, SAP Concur, SAP Fieldglass, Amazon Business, Alibaba 1688, Uber for Business, Service Now and JIRA
  • Cognitive e-procurement applications with intelligent workflow platforms – IBM Procurement Service Desk, IBM Watson Virtual Buying Assistant, IBM B2B Marketplace and IBM Direct Spend IQ

Organisations often invest in one or two types of procurement technology, which does not typically enable achieving their procurement strategy and vision. Often these organisations assume they fell short due to the technology implemented. By deploying relevant technology from each of the four types, organisations achieve the clarity needed to meet their goals.

3) Focus on cognitive e-procurement applications

Organisations find a wide range of choices in technologies, especially in cognitive e-procurement applications, which use artificial intelligence to open procurement transformation processes. This type of technology helps organizations transform the procurement process experience for buyers in direct, indirect, MRO and capital purchasing.

Because cognitive e-procurement applications are relatively new and come with a large amount of hype and innovation, organisations should fully understand what features they need as well as the features offered by each solution. By selecting the right application for your specific needs instead of the most feature-rich product, you’ll significantly increase your ROI and strategy improvements.

For example, Trust Your Supplier blockchain, which came to market in 2019, helps procurement professionals automate and digitize supplier information like a “digital passport.” The application also provides the immutability and trust that comes with processing transactions through blockchain. Because the application shifts the process out of procurement operations, the technology reduces cycle time, lowers transaction costs and improves reliability of supplier information management operations. Additionally, suppliers streamline their process by only submitting information to a customer once and can share the same information to other customers using a digital key for record access.

Making the move to integrate technology

As organisations continue to manage change and disruption due to the pandemic, creating clarity in your procurement cycle remains a high priority. Through using cognitive technology driven by intelligent workflow platforms, in conjunction with the three other types of technologies, organisations can create the most effective and efficient processes that drive business value. By aligning strategies, understanding the types of technology and implementing cognitive e-procurement applications inclusive of the technology ecosystem, organisations can improve performance, maturity and outcomes.

Chander Vashistha is the source-to-pay practice leader at IBM.

How To Create A Procurement Service Desk

How can you centralise disparate tools and requests to receive, triage and manage work across the source-to-pay process without replacing your applications? It’s not as impossible as it sounds.

Photo credit: @proxyclick | Unsplash

Are your stakeholders frustrated with finding their way through the procurement maze? As a procurement practitioner are you overwhelmed with navigating your way through a variety of disparate tools and requests, such as procurement, accounting and reporting, to get your work done?

Many organisations are increasingly improving the efficiency of the procurement process by implementing a “Procurement Service Desk,” which is a single, centralised user portal for stakeholder requests, routing, communication and PR/PO status reporting.

One-stop shop for “all things procurement”

By using one portal instead of multiple systems, the Procurement Service Desk provides seamless engagement for procurement and its stakeholders, which helps procurement organisations receive, triage and manage work across the source-to-pay (S2P) process. The single portal improves the overall user experience and outcomes with procurement for stakeholders, including requestors, legal, finance and operations.

With a Procurement Service Desk, stakeholders no longer have to spend days trying to figure out where to go, who to call, and what information is required to engage procurement. The platform provides procurement stakeholders with a simple user experience to submit procurement requests. A dashboard provides full visibility to requests and statuses throughout the end-to-end procurement process. Stakeholders and procurement now collaborate directly in the centralised portal instead of through numerous emails, files and phone calls.

Procurement organisations typically realise these value-based outcomes after implementing a Procurement Service Desk:

  • Automated triage of work to appropriate practitioners through intelligent routing
  • Improved user experience for clients, supplier and S2P practitioners
  • Workflow data captured in a structured manner for utilisation to improve processes, deliver efficiencies and provide an improved experience
  • Enablement of metrics that matter
  • Intuitive, easy-to-use platform
  • E2E flow supported by a single platform

Shortening the process through intelligent triage

Through the Procurement Service Desk, stakeholders submit requests covering the full S2P process, including sourcing, contracts, supplier onboarding, purchase orders and invoices. By using standardised processes and forms, the Procurement Service Desk ensures compliance and gathers required data from stakeholders.

Requests are based on standardised processes and forms, ensuring compliance and that required data is received upfront from the stakeholders. Because procurement professionals don’t have to chase down additional information from stakeholders, the Procurement Service Desk enables a more efficient process and quick turnaround times.

When a request is submitted through the Procurement Service Desk, the platform triages the request through intelligent routing rules to the appropriate procurement practitioner for no-touch handling.

Triage rules based on commodity, request value, country and supplier match the request with the most appropriate procurement practitioner. This automated triage ensures work gets to the right team quicker and more accurately, improving stakeholder customer satisfaction.

The Procurement Service Desk provides procurement with full visibility to the types of requests coming into the organisation through an executive dashboard, helping managers measure and address workload balance and required skills. The platform also provides improved data-driven insights based on the volume and types of requests received from stakeholders.

Integrating processes and systems

Because the Procurement Service Desk sits on top of an integration layer, the intake request process connects with the back-end disparate tools and micro services. Procurement manages their full workload in a single platform regardless of the back-end transactional systems. By sharing data from the intake process bi-directionally with the back-end transactional applications, the Procurement Service Desk eliminates data re-entry, improving process efficiencies and analytics.

The Procurement Service Desk also easily connects to other services, such as Marketplace and Analytics, making them easily accessible. Previously disparate tools and services, they now easily scale and function as a fully integrated platform.

After making the decision to move to a services desk, procurement organisations should begin looking for a system platform to manage the Procurement Service Desk and integrate their key systems. By working with a company with specific procurement experience, organisations reduce business disruptions and speed up implementation.

Learn how IBM Procurement Services can help to reduce business costs and meet the challenges of complex global enterprises through effective data-driven source-to-pay operations by visiting www.ibm.com/services/procurement