Efficio Panel Debate: Good Banter, Robot Jokes and 3 Points About the Future of Procurement
Last week in London I participated in one of the livelier and more spirited panel debates on the future of procurement (skills, technology and more) in recent memory. The event, held at Efficio’s offices Thursday to mark the release of its latest report, “Procurement 2025: Is Digital Transformation Driving More Effective Procurement,” included not only a handful of esteemed panelists and facilitators from the procurement/CPO, consulting and academic ranks, but also a robot — which led to many robotic process automation jokes throughout the discourse.
The standing-room-only event was a real hit with a great cross-section of senior folks from different types of organizations (from CPOs at high growth firms to procurement executives at some of the biggest names in global finance and other industries) with great side discussions throughout.
If Efficio does something like this again, ask them for an invitation — you won’t be disappointed!
Here are three points that stuck in my mind from the different panel discussions and chats that I had:
- From a discussion with a battle-scarred CPO (and former A.T. Kearney consultant): Indirect procurement is incredibly hard to mine for savings — given all the supplier, finance/budgeting and other games that different actors can play in it (not to mention stakeholders). Identifying savings is not the main issue (nor will it be in the future) — it is how technology might enable us to finally implement and realize indirect savings effectively in the future. This is not a procure-to-pay, e-sourcing or other question. Rather, it is how we impact budgets and the profit-and-loss statements through actual cost reduction rather than what is “booked” in procurement systems or identified through sourcing efforts. As we look to how to better leverage technology to create the digital procurement function of the future, we can’t forget how past efforts have failed us here. And that it’s not the technology alone that creates results!
- From a number of panelists: Those who started their careers in sourcing, consulting or procurement (in senior ranks) 20 years ago remember the days of TI calculators and graphics assistants — and less powerful versions of Excel. These were the “literacy” tools we all needed to do our jobs at that time. The evolution of this tool belt was fluency in Excel, PowerPoint and basic procurement technologies. In the future (and already today), knowing the Microsoft productivity suite (including Access) will just meet the ante. Essential procurement technology literacy tools (for everyone on a team from analysts to CPOs) going forward will include core business intelligence applications (e.g., Tableau, Power BI), basic coding/scripting like macros, and a working knowledge of how to employ advanced capabilities like artificial intelligence to both augment/improve and replace humans. And of course, knowing how to take advantage of the nuances of source-to-pay technology will go without saying!
- From discussions with the Efficio team before and after the panel debate: Suppliers are key to more effective technology engagement in the future. We can’t forget this! In fact, the above-linked study that Efficio released on the date of the event (based on a sample size of 225 procurement/finance organization team members equally split geographically in the U.S., UK and Germany) found that 64% of respondents believe that suppliers will play a “crucial” role in helping them meet procurement objectives. But supplier engagement and innovation is not a one-way street, as 69% of those surveyed believe that procurement must look to make “longer-term” commitments with strategic suppliers.
Let me close by noting that as the one “Innocent Abroad” or the “ugly American” as I like to say participating in the event, I found it fascinating to speak to a number of folks from across the Atlantic both in industry and consulting who are open to using disruptive procurement technologies to leapfrog ahead. While some people like to stereotype that the U.S. is ahead of the UK and Europe in procurement technology adoption, when it comes to actual use cases and those taking advantage of more advanced initiatives and technology features (vs. letting them sit on the shelf), I think the reality is quite a bit more complex — with some of the biggest risk-takers and innovators coming from regions that have historically adopted technology more conservatively.
Article written by Jason Busch, Founder at Spend Matters, originally published on Spend Matters