From analog to digital procurement. Simple? Not quite.

I can still remember being called into a meeting to listen to a presentation from 'Freemarkets'. It was the year 2000. Reverse auctioning was going to change how we buy. Every allocation would flow to the best provider as their best offer combined with data on their performance would optimise the sourcing decision. It would be that simple. Our jobs - young and ambitious Purchasing Managers - would be orchestrators. Manual tasks of collecting and combining data would be something of the past. Buyers would hold ultimate power over sellers. Sourcing decisions will be fair and unbiased. Good companies will grow and bad companies will disappear. The world will be a better place.

Now fast forward 20 years to todays reality: Purchases Managers spend their time collecting and combining data from a myriads of systems. Supplier data is everywhere. Excel and outlook are the most used tools and data flows manually between the different procurement stakeholders. Sourcing decisions are argued over as it is not clear why certain suppliers have been selected or what data has been used. Talent from the procurement department is moving elsewhere as procurement just seems not to get it.

How come that the reality for so many is so different to the promise that was made 20 years ago? The technology is there: Cloud Computing, AI, Community Intelligence....all have made massive progress over those 20 years. Technology companies have focussed on Procurement...... Why is procurement not where we need to be?

The reality is that digital transformation is hard. Really hard. Only 40% of digital transformation projects meet their targets. Most procurement professionals don't understand technology. Most technology professionals don't understand procurement. While this is true, I would like to offer 3 simple steps on how you can get started on your digital procurement transformation:

1) Form a team with IT, Finance and Procurement and determine a few well articulated objectives and goals.

2) Keep it simple: Procurement has many stakeholders and while everything is important, some things are more important than others.

3) People, process, technology. Yes, people, process, technology. And again......

You simply have to do many things right to progress on this digital journey. But why not start? Aren't the biggest challenges the most interesting ones at the same time? The technology out there is so interesting, can we simply afford not to use it? The future of procurement is digital. It's for everyone and the future is now!