There’s a lot of talk regarding all the ways technology is going to revolutionize procurement. Blockchain can increase supply chain visibility, the Internet of Things (IoT) can change the way our business devices communicate with each other, etc…But what type of innovations are available at the sourcing level?
From paper RFPs to conferences, it seems the way we source business has largely remained the same. Procurement teams are limited to siloed, outdated supplier databases and incomplete business information when attempting to make business decisions. It’s expensive and time-consuming to get a holistic picture of a supplier’s business health and mitigate third-party risk. How can we adapt today’s technology for tomorrow’s sourcing needs? Here are a few innovative ways that your organization can source business:
1. Mobilize Your Supply Chain
I believe the key to sourcing success lies in mobilizing supply chains. Right now, supplier data is locked down in many different places that don’t communicate with each other. A large organization may have supplier data separately located throughout their ERP and CRM systems, accounting and legal departments, and Excel files floating around from supplier diversity programs, in addition to their procurement arm. Teams are often tasked with managing legacy Electronic Data Interchange (EDI) systems with high overhead cost and systems that are unable to effectively manage the dynamic nature and sheer abundance of today’s business data. Traditionally, supplier information has been limited to line items such as name, tax ID, quantity and price of sourced product, and remit-to-pay. For buyers, it’s difficult to maintain an accurate source of visible supplier information. And for suppliers, it’s difficult to constantly keep track of the portals they’re in and maintain so many up-to-date profiles. Suppliers often aren’t incentivized to keep their information up-to-date, as many enter their profiles without callbacks or tangible business return. By making your supplier data more accessible, you can mobilize your supply chain to better respond to factors that might affect your daily business operation.
2. Utilize Procurement Technology
We can use technology to fill in the gaps between buyer and supplier connections, doing more with less. Buyers are pressed to manage their supply chains quickly and efficiently. In today’s rapid-paced market, success requires strong collaboration with suppliers and innovative new processes. To support meaningful two-way conversations, buyers and suppliers can interact with centralized, real-time business data. Cloud-powered solutions reduce sourcing time and costs while maximizing business growth and business data accuracy. Blockchain technology may soon be implemented in supply chains around the world, increasing supply chain transparency and accountability. Intelligent automation can decrease repetitive and routine tasks, freeing up procurement professionals to focus on more nuanced and complex problems that provide high value-add. With the rate that today’s technology is progressing, technical solutions are virtually limitless. However, it requires creativity and careful execution to properly implement.
3. Focus on Velocity
Mobilizing your supply chain makes it easier to respond to any issues or changes that you may face in your day-to-day business operations. Today’s industry headlines seem to repeatedly cite supply chain nightmares happening to businesses all around us: data breaches enabled through a weakness in a vendor’s security system, business continuity failing because a primary supplier faced a natural disaster, and so on. Security, social responsibility, and business ethics are all tied to vendor risk factors facing your supply chain. The ability to quickly respond to today’s changing global landscape is vital. Does your organization have an adaptive sourcing framework? Consider adding velocity to your supply chain with technology and maximizing your sourcing impact today. Diverse and inclusive procurement can mitigate many risk factors and lead to cost savings, labor reduction and increased innovation.
Continue the conversation on supply chain management with Daryl at SIG's Fall Global Executive Summit in Rancho Mirage, California. On Tuesday, Oct. 16, Darly will host a two-part lab on Sourcing a Supplier Eco-System Built to Last: Approaches to Supplier Risk. Click below for more information and to see who's presenting at this Fall's Summit.
Daryl joined ConnXus as General Manager/Chief Operating Officer in 2014. After retiring as Senior Vice President/General Manager of Sears Optical, N.A., Daryl founded Peabody Executive Coaching in 2012. With over 20 years of experience coaching c-suite levels in organizations large and small, Daryl leads a diverse, cross-functional team and manages day-to-day operations.