It is not just the pandemic hit that has drastically blown the minds of procurement and sourcing experts of the era. It has been consistently undergoing a revolution since the financial crisis of 2008. The difference being, leaders found out new survival strategies after the 2008 hit and got accustomed with the change. Since then, procurement and sourcing have adapted digital technologies to become capable of handling a broad spectrum of organizational world, have been talked about interchangeably, and much like a set of twins, worked interdependently. Also, global procurement service leaders started taking this interdependency for granted, thinking time won’t change! Least they could sense, the world would undergo another economic hit, but this time, in a greater force, reaping through whatever was sown beforehand.
Everywhere you see, sourcing and procurement operations have been distorted, leaving everything in the hands of uncertainty. And, when uncertainty is in the air, leaders are trying to ‘adapt’ to the new normal. While organizational heads will think about stepping out from the interdependency between various lines of procurement and sourcing, they will initiate partnering with purchasing organizations to survive in the long run.
Here, in this context, you will learn about seven such survival trends that will rule the sourcing and procurement industry beyond 2021.
Coming from a digitally improvised generation, you can either be sad over the split milk or update yourself with the new normal sourcing and procurement trends. Since it will be better to go with the second option, you can read through this context to thrive in the competitive market.
Enhance Procurement And Sourcing Flexibility
With an increased interdependency among the procurement and sourcing operations, that became more global with time, organizations are dealing with enhanced climatic changes, risk of geopolitics and health issues, and the establishment of multi-polar financial system. The pandemic has also exposed the vulnerability of the complicated supply chain network, specifically of the technological and automotive manufacturing organizations.
At such times of difficulty, companies are focusing to uphold the resiliency of sourcing and procurement operations by conducting a thorough assessment of the risks associated with the related operations and now they are trying to manage them thoughtfully more than ever before. They are trying to renegotiate with their existing suppliers in terms of how their upstream chain value will adapt to the changes, in order to create better transparency between buyers and suppliers.
This will aid in a consistently running business operation, help in gaining more information about the new as well as already existing supply chain operations, and design contingencies for every supplier plant working remotely and countries that are still inaccessible.
The second most important thing procurement and sourcing operational teams need to focus on is streamlining their requirement from the suppliers. They need to find out the exact quality as well as quantity they require to serve the ever-changing needs of the customers and talk it out with their suppliers. This will majorly help the vendor selection team of every organization to find suitable suppliers who can understand their requirement and deliver the required products on time. The team can make a compiled list of vendors who can work effortlessly and efficiently and select vendors in a comprehend way from the existing list as all vendors would not meet their requirements.
After carrying out suitable research and interviews on the vendor’s existence and workmanship capabilities, the vendor selection team can send request information to the selected vendor and shortlist the final vendor after evaluating the response from their end. After making the final selection, the buyer and the vendor can, finally, proceed with their contracts.
Digitization And Automation Of Existing Procedures
With the world heading towards adaptability of new process and solutions, it will be very obvious for global procurement services to undertake e-market places to make sure on-time deliveries of products and services. The already existing artificial intelligence and Natural Language Processing technologies have underwent a radical change in their usages. This has positively impacted how procurement and sourcing activities have increased their performance resulting in shorter work cycle and fulfilment of operations as compared with the speed a few years back.
Another key aspect to visualize a positive sourcing and procurement trend is to make space for user-driven digitization and artificial intelligence. In the recent days, most of the procurement and sourcing operations are completed with the help of intelligent bots, running the procurement tasks and minimizing the human intervention. Finally, the new-age technologies is, taking up all the activities, thereby putting an ample amount of task on auto-pilot mode.
Procurement Will Partner Directly With Business Units
The entire procurement system will be reduced to a smaller and centralized space. This will help create a more agile functioning system for the procurement leaders where they will be reaching out to more people geographically but, in a virtual center. This will also allow the procurement and sourcing experts to meet the increased collaboration.
In this way, business owners can pair up with the category managers so that they can focus on the category and procurement needs of the business. The gig economy will be leveraged upon to have specialist expertise and knowledge on and as-needed basis.
Integration With Supply Chains
One of the newest trend coming into action will be the adaption of the circular supply chain model. This will be an incredible adaption for organizations across the world that will soon take the position of linear supply chain operations. The main and valid reason behind organizations adapting this stand will be to decrease impact, cost, and waste that might impact the environment in the long run.
Whenever this trend will be widely accepted by organizations, the leaders of the respective organization will require to opt for stricter regulations when it comes to disposal of waste and recycling of junk. Long-lasting efforts should also be made on giving valuable insights on the disposal of waste.
These are some of the trends global procurement services should follow to cope with the upcoming dangers. This will not only bring insights to their table, but will also make their business units stronger than ever before.