5 Themes That Can Help Procurement Shape The Next Normal
Procurement leader’s priority: Re-imagination
1. Re-calibrate cost-saving targets by zero-based category and value-creation strategies
To achieve the earnings improvements many organizations are looking for, procurement leaders will want to examine new ways to create value. Applying zero-basing to spend categories can reveal previously hidden resources which can prove critical in responding to significant changes in demand-supply dynamics.
2. Unlock new opportunities by investing in supplier partnerships and joint innovations
By establishing joint ventures with suppliers offering leading-edge technologies, the company managed not only to reduce parts costs but also to bolster supply-chain stability while extending new technologies into its product-development arsenal.
3. Accelerate value capture, leveraging digitization and spend analytics
As organizations re-imagine for the next normal, procurement functions can use this time to create a digital roadmap laying out the route to a procurement function of the future. Beginning with an assessment of the digital and analytics capabilities required along the end-to-end source-to-pay process, procurement leaders can identify the points most requiring enhancement and then prioritize the most relevant use cases.
4. Enable remote-working models by transforming them into a future-ready operating model
Procurement organizations that can reimagine their operating model across six
enablers process, digital, data, organization, governance, capabilities, and culture will be best equipped to realize improved employee morale and productivity in the post-pandemic environment.
5. Help employees with new working models by reinvigorating both the core and new capabilities
To help address these concerns, procurement organizations will want to define the best-practice processes and the capabilities needed for their execution both within and outside the procurement team. Procurement functions can start a capability-building journey by the bench-marking organization and individual capabilities, defining the gaps in core and new skills, and adopting a structured approach to capability development that addresses key skill gaps.