How to Stay Ahead of the Curve with Process Automation
Traditional supplier relationships are under scrutiny as organisations assess capabilities for the future. Could process automation help procurement teams stay ahead of the curve?
ProcureCon Europe 2016 is rapidly approaching! The ProcureCon team has been investigating some of the fast-moving issues which are affecting CPOs across Europe today.
Perhaps more than any other factor in the industry right now, process automation and advanced analytics are having a huge effect on the ability of Procurement teams to deliver improved cost performance.
This changing landscape calls into question traditional supplier relationships. Of the CPOs and Heads of Procurement we interviewed in advance of the event, 76 per cent told us that they are concerned about the ability of their existing supplier base to serve their business needs in future.
At the same time, more than half of our research participants think that implementing automated procurement is a high priority for their business. This raises questions about how best to manage your supplier network to make sure that you’re ahead of the curve when it comes to process automation.
We spoke to Kelly Babbit from jCatalog and the Opus Capita Group to find out more.
ProcureCon: How is digitisation and process automation affecting CPOs today?
Kelly Babbit: In the digitised, networked economy, companies find themselves in a changed competitive field. The game is no longer primarily based on unique business relationships.
The success of a corporation is premised on the performance of its network of supply chains – its entire business ecosystem. Corporations are looking to strengthen relationships, and create new forms of collaboration – and gain control and compliance over their extended business processes.
It is significant that more than half of respondents to this research gave high priority to the implementation of automated procurement processes. Furthermore, we expect a future adjustment to the demand drivers and criteria used for selecting P2P service providers.
This trend is due to a far-reaching shift in business priorities toward digitisation and automation.
What kind of processes are we talking about?
Progressive solutions cover the complete process from sourcing to payment – from managing the first request for quotations (RFQ) to optimised working capital management and supplier settlement.
This is where the traditional view of P2P processes needs to be expanded. Enterprises will no longer evaluate the quality of solutions with a sole focus on basic procurement functions. Solutions need to be part of a global strategy and based on pivotal interconnections between buyers and suppliers.
As a result, the responsibilities of the CPO and CFO functions will begin to converge. Cloud based SaaS solution providers will need to support this interconnection with a global perspective and inclusion of diverse company stakeholders.
Connecting and automating processes from sourcing through to payment will become the expectation of leading companies.
What features should CPOs / CFOs be looking out for in a source-to-pay solution?
Cloud-based business network solutions must support effective sourcing, procurement, invoice, and payment automation. This includes implementation and adoption across their global business. Some of the key features to look out for are:
- Complete transparency, real time control and compliance with full audit trails across the entire source to pay process.
- P2P automation and integration of the purchasing department with the accounts payables department. Plus full visibility to all purchasing and accounts payment data.
- Visibility to company spend with total cost monitoring and supplier performance tracking as well as contract improved contract compliance.
Thanks very much for your time, Kelly.
To read the full results of our research amongst 100 CPOs and senior procurement executives, download the Procurement Challenges report here.
ProcureCon Europe, now in its 17th year, is Europe’s most strategic procurement conference for CPOs and senior procurement executives. See the full range of topic and speakers at the event here.
