It's no secret that Procurement's role and responsibilities are evolving. It's equally well-known that many Procurement leaders see emerging digital solutions as the fuel that'll drive further evolution. In 2017, a Hackett Group report suggested that 84% or organizations aren't just pursuing digital transformation, but also fully expect to realize one within the next five years.
You can't blame organizations for expecting a lot of emerging technologies. The providers know their audience. They know that Procurement leaders are eager to stand set their function and their organization apart with cutting-edge solutions to everyday problems. Leveraging buzzy keywords and promising world-class results, they're often too effective in selling the benefits of their solution. Coupled with Procurement's urgency, this salesmanship can easily lead Procurement down the wrong digital roads.
Before Procurement looks out into the market, the function should look inward and make an unbiased assessment of its current needs and capabilities. What's more, this process of soul searching and honest questioning should continue throughout the selection and implementation process. Procurement cannot hope to find the answers its looking for without first asking the right collection of questions.
Where do we stand?
Too often, Procurement pursues a digital transformation without reaching an understanding of its current state. Failing to take stock, they enter into initiatives with poor visibility into what their team actually wants and needs in a new solution.
To effectively shop for a new tool, Procurement needs to understand how its current solution is performing. Surveying your internal team will provide a sense of what's working well and where your team is hoping to observe improvements. These short conversations will keep you from chasing a tool that's poorly suited to your organization's needs.
Take care to interview everyone who will come in contact with the tool - particularly those who will participate in implementation. It's entirely likely that many of the options out there won't prove compatible with your existing systems. By engaging with IT and other internal stakeholders, you'll better understand how compatibility should play into your decision making. You will also gain an idea of your team's capacity for change. This will provide for a manageable timeline and reasonable expectations.
Why are we pursing a digital transformation?
The list of popular wrong answers to this question is a mile long. Procurement should never pursue a digital transformation because it's what their competition is doing, because a salesperson told them to, because a blog suggested it, or for lack of anything better to do.
Procurement organizations tend to take a short-sighted approach to developing their digital transformation goals. New technologies are so enticing, their implementation so potentially arduous, that introducing a tool often feels like a worthy goal in itself. This should never be the case. Treating digital transformation as an accomplishment to be ticked off a list is the absolute wrong way to go about evolving Procurement. Digital transformation is an ongoing process. It's characterized by consistent effort, regular assessments, and measured pacing. If you're not prepared to work hard for an extended period, you're not truly prepared for a digital Procurement transformation.
The answer to this question should coincide with your previous answer. Your technological investment should serve your organization's future goals and objectives and play a role in a broader change management program. However your organization defines 'change,' ensure you select a tool capable of promoting it. That way, you won't find yourselves struggling with an outdated tool five years down the road.
Taking the opportunity to level-set across the organization and discuss the future won't just make it easier to select a tool. The extra effort will have added benefits across your various change management initiatives. Your team will better employ your new technology and - more importantly - they'll understand your company's vision and their part in seeing it through.
Procurement solutions are a big investment. Depending on the tool, it's entirely possible you could be making a once-in-a-career purchase. Don't make that decision lightly. Reach out to Source One's Procurement Technology advisers today. We know that even making sense of the market is often overwhelming. We'll support you in assessing, selecting, and implementing the tools you need to transform Procurement and realize world-class results.