The entire landscape of procurement is changing, and it will be completely a raw system a few years from now. Various factors having an ever-increasing impact on organizational operations are artificial intelligence, machine learning, and the Internet of things. These factors have been playing major roles in shaping the future of procurement. But, the question is how these factors will actually influence the procurement’s future. This context will exactly focus on answering this question.
Read on to know the four trends observed by global procurement service providers that will define the future of procurement in the years to come.
Internet Of Things And Cloud-Based Technology
The twenty-first century’s second decade witnessed a drastic transformation in the collection and management of data. The owner of several organizations was able to assemble, stockpile, and assess a greater amount of data than ever before with the help of Big data assessment. It was only after such advantages that organizations received by utilizing the Big data that they realized how crucial it was for them to make the use of cloud-based technology, specifically when it was as important a matter as turning Bid data into useful insights. Cloud-based data’s main aim was to tie every possible data in the environment with the thread of unity. Cloud-based management which is considered as a redundant, decentralized, integration-friendly, and scalable management system turned out to be extremely beneficial for the organizations as owners of such organizations could seamlessly connect both hardware and software with each other.
As for procurement, cloud-based technology has benefitted it in a number of ways since its emergence. Now, various functions of procurement can be smoothly and conveniently integrated with the available software packages from production, accounting, and customer service. And, it was possible to make such improvisations in technology only because of the advent of artificial intelligence and process automation. Together with process automation and artificial intelligence tools, integrated procurement functions could bring the entire organization as a part of the supply chain management. This, in turn, allowed the global procurement service providers to efficiently collect and analyze the data that procurement teams could use to upgrade the comprehensive competitive performance of the business.
As more and more devices will get connected with the Internet, a greater amount of Big data will be fed to the system, thereby making it more convenient for cloud-based technology to play its roles in procurement for 2020 and beyond.
With the passage of time, the Internet is becoming thoroughly entangled with increased cybercrimes. With such levels of risk, procurement leaders will certainly continue to set their priority on the protection of cyber information and prioritize it as the core element of their digital conversion strategies. Artificial intelligence tools, driven by the automated systems in organizations will make it easier for procurement leaders to establish fortuity to shield every aspect from the optimization of the supply chain to approve the workflows to the management of assets and logistics. But with the ever-increasing dependency of procurement teams on the cyber world related technologies to enhance the savings quantity and extract value from supply chain management and actionable insights, the need to guard these systems from corruption, outright destruction, and tampering becomes crucial than ever.
In 2020 and the upcoming years, global procurement service providers will have to face an array of emerging cybersecurity risks. From hurling back the malware and ransomware to shielding the target customers from every possible theft to avoiding the shutdown of production, and exploitation of personal data, cybersecurity is one such trend whose priority will increase in the upcoming years.
Analysis of Big Data
The supply chain has several parts and forces to play- from the production of the raw materials by drawing them from the trusted vendors to managing the payable accounts which include processing the invoices and paying back to the vendors as accurately and efficiently possible. And, an interconnection between these forces means giving way to the rich data sources that can turn data into insights for driving value creation and cost reduction. The major technology that is assumed to hit the various functions of procurement is Big data. Big data is supposed to retaliate the procurement functions in the following ways:
- To reposition the procurement processes
- Enable clear and accurate data analysis to improvise the supplier relationship with buyers, to improve the decision-making processes, to properly manage risks, and a lot more
- To effectively support the analysis and assemblage of data from external and internal sources
With such massive influences on the way of the procurement system, Big data will continue to take the lead role in several procurement organizations. And, this will only happen because strategic sourcing and process optimization will heavily depend on having precise and real-time data to assess.
Change From Savings To Value
The role of procurement was already transformed with the advent of artificial intelligence tools, cloud-based management of data, and automated process optimization. It is a change that was witnessed by the procurement world as soon as there was a shift from paper-based procurement to a completely digital-based procurement process that created an effective ripple:
- Free the employees of procurement companies from tasks of low value
- Improving business efficacy and speed by maximizing the cost reduction throughout the supply chain management
- Aligning supply chain management and spend to reposition procurement as an operator of smarter spending, opportunities to form a strategic relationship, reduce exposure to risk to achieve the overall goal of the organization
In this way, modern procurement function associated with the other technologies and tools has become the beating heart of various business procedures. And, in this way itself, procurement functions have been optimizing and interlinking business units to reduce expense and waste while enhancing the profit margin and associated value. These transformations will continue to remain the heart of procurement organizations in the upcoming years.
While the future is full of uncertainty, becoming protective against the loss can be the smartest move you could take. Investing your capital in the current procurement innovations and including value creation will ensure that you enjoy a flexible and powerful procurement strategy. In this way, the global procurement service providers will be seamlessly able to incorporate whatever technological trends in their procurement functions in the upcoming years.