Learn how to enable best-of-breed ProcureTech featuring Supply Chain & Procurement experts, Dr. Elouise Epstein, Partner at Kearney, & Costas Xyloyiannis, CEO at HICX
Digital technologies drive path to strategic procurement
Technology and data will have a crucial role in enabling business strategies in 2022. Increasingly, companies are looking to build agile, flexible and stakeholder friendly ProcureTech landscapes. Digital technology drives gains in efficiency, experience and enables a greater focus on strategic procurement.
This invariably leads to a mix of best-of-breed and suite solutions co-existing, bringing together different best-in-class capabilities.
This creates a challenge. How do you bring data and workflows together to connect the solutions within the ProcureTech landscape efficiently – and enable best-in-class user experiences?
An exciting time for Procurement
Dr. Epstein opens the conversation with some positive words for Procurement. “I often say that now is the greatest time to be in Procurement. It’s because technology has arrived, digital has arrived for Procurement – and it’s driving this path to the strategic procurement we all dreamed about for the last decade or two.”
Her statement comes with a warning, though, as she continues, “However, traditional technology is wholly inadequate to support the digital evolution. There is a mountain, an overwhelming amount of evidence, to say that the way we’ve done it in the past doesn’t work. Kearney is one of the most expensive management consulting firms in the world. You don’t hire us to implement one of the traditional providers. You only hire us when there’s either a huge opportunity or a huge problem. And I’ve built my career coming in off the back of failed implementations. So, I have seen this, it’s abundantly clear that we have to do something different.”
Recent events also serve as a wake-up call. “We find ourselves stuck in the old paradigm, the old upstream-downstream construct, and this no longer works. It took the pandemic to really blow this out of the water, although we saw it already with the trade wars, at least in North America, the America-China trade wars,” Dr. Epstein adds.
It is this, Dr. Epstein claims, that is driving her vision of the best-of-breed ProcureTech landscape as she presents it, which she describes as a technology architecture consisting of an ecosystem of connected micro-services, offering value creating point solutions. This architecture comprises a central hub or platform, into which a wide range of services are connected – everything from supplier performance through to contract lifecycle management (CLM), smart contracts, advanced sourcing, process intelligence, spend analytics and so forth. It is, in Dr. Epstein’s words, “the procurement value chain deconstructed.” New services are being added all the time as requirements quickly evolve.
She adds, “We’re in 2021 and going into 2022. We need to bring procurement technology to where the user is. We need to use that intelligence to make the user experience much better. The point is, we need a new architecture which means as you think about your digital strategies going into 2022, you need to look at this in terms of capabilities.”
Time to value
Dr. Epstein stresses the importance of time to value, which she views as the single most important outcome of a well-executed best-of-breed ProcureTech strategy.
Again, she compares this to the traditional approach to illustrate the difference, as she explains, “Typically, historically, consultants will come in and tell you, you have to do CLM, you have to do the repository, you have to do workflows, rerouting, approvals – and these are all really good things. But if you spend 18 months and several millions of dollars on consultants to define all this and all the code, after 18 months you have delivered zero value to the business.”
She adds, “You’ve gone through an intellectual exercise for Procurement, a good governance exercise, but nothing to help the business. Whereas, if we flip the paradigm and say, ‘let’s get all of our contracts together (it doesn’t even have to be a single repository) and we put some analytics on top of it, guess what? – All of a sudden, we can start to extract insights from our contracts in terms of how complex they are, where we have risk, where we have pricing mismatches – and start to enable our categories managers and the business itself.’”
“When we talk about best-of-breed ProcureTech, the time to value should be three to six weeks, not three to five years, and this is a critical takeaway. So, if we take nothing else away – time to value measured in three to six weeks,” she continues.
Full article here: https://www.hicx.com/webinars/learn-how-enable-best-of-breed-procuretech/
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