Think big with strategy at the forefront
Procurement leaders see strategy trailing structure and technology as barriers to future readiness. Even so, investing in a bold strategy from the start is important to truly transform operations in a sustainable way. Too often, organizations—procurement included—make incremental changes in pockets. They get stuck in the details of building the perfect business case, limited by organizational silos, or impatient for a fast return on investment. This creates a big risk of missed opportunity, and often, underwhelming results.
Emphasizing strategy at the enterprise-level is critical. For many CPOs, operational change in their own areas has traditionally been about cost savings. This is understandable, but it’s only part of the story.
This North Star is value beyond cost savings—it is holistic value that impacts all stakeholders—the enterprise, suppliers, customers and even society. With a holistic view, procurement can create end-to-end value, such as trusted supplier networks, thread sustainability into all procurement activities, provide next-level experiences for employees and suppliers, prepare procurement teams for the future of work and build responsible sourcing practices grounded in diversity, ethics and fair labor practices.
Collaborate across business and technology
Organizations today can’t expect to realize the full value of their strategy without effective collaboration between business and technology. After all, technology fuels business in the digital age. Innovative, strategic companies know this well and emphasize breaking down barriers between IT and other departments. Most future-ready organizations (86%) expect business and technology to collaborate fully by 2023, up from 55% today.
To make progress with their own technology agendas, CPOs need to continue to strengthen their relationships with CIOs and build the business case for technology investments such as new spend management tools and AI-driven procurement solutions. Given the fact that procurement is rarely a high investment priority for CIOs and CPOs typically have to manage with lean budgets, this could be a challenging undertaking.
While closing this gap takes both operational and cultural change, procurement is in a unique position to help build bridges because every person in the company uses procurement systems regularly. For example, by providing a simple, user-friendly experience in its buyer portal, procurement can show the enterprise the value of business and technology collaboration in tangible terms.
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