procurement transformation and the digital workplace · the digital workplace •procurement needs...

Procurement Transformation and the Digital Workplace

GEP

Paul BlakeAssociate Director

1© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform

HOW PERFORMANCE-DRIVEN PROCUREMENT GETS RESULTS

THE INDUSTRY’S LEADING SOURCE-TO-PAY PLATFORM

Procurement Transformation and the Digital Workplace


Agenda

A Productivity Crisis? ①

Digital Transformation and Procurement’s Role in it ❷

Emerging Technologies andwhere they fit ③

Putting People in their Place❹

A Bit of a Case Study⑥

How to Think of the Future❼


2000 Q1 2002 Q4 2005 Q3 2008 Q2 2011 Q1 2013 Q4 2017 Q2

Output (GVA/GDP)

The Reality of Growth

Source: ONS.gov.uk

85

90

95

100

105

110

115

120

125


Is technology getting in the way?

"Technology can overload people and make them less productive because they get caught up in it rather than use it to deliver a service or a product.“

"Productivity comes from creative interchange, it does not come from people sitting in front of machines sending emails."

Sir Cary CooperProfessor of Organisational Psychology, Manchester Business School


Not all technology advancement is helpful

Non-spam, non-relevant email volume by quarter


“Technology is no longer a tool for

helping the procurement

process. It definesthe process and its

use determines success or failure.”

PEOPLE

PROCESS TECHNOLOGY

Everything has changed

PEOPLE

TECHNOLOGY

PROCESS


ERP

Software is no longer just a business toolkit

PLANNING

SOURCING

Supplier

Relations Purchasing

Contract

Software is now where business happens

Spreadsheet

Sourcing Tool


The Procurement Process

Utilise the contracts

according to the agreed terms to deliver realized

value

Manage the supplier

relationships and risks to ensure

contract compliance

Investigate spend history and

activity to identify opportunities for value, savings and

efficiency

Develop plans and strategies to deliver the

potential value and savings identified

Execute the plans through sourcing, negotiation and establishment of vehicles for value

Encapsulate the agreed terms and potential for value

in contracts

Increasing potential to realize savings and valueThis is where

the savings are realized


The Procurement Process

Operating business

unaware of contracts, prefer

local suppliers or taking a

“path of least resistance”

Supplier Relationships

left unmanaged, compliance to

contracts unmonitored

and negotiated terms lost



efficiency





in contracts

Despite the work to set up the value Value cannot become realized


The IT impact on Procurement

• Digital Transformation is a hot topic

• The Digital Workplace is planned

• Procurement plays an increasingly strategic role in the business

• Procurement and IT each need to understand the other’s agenda

• Procurement is not an afterthought- in fact IT can drive the Digital Workplace agenda forward by partnering with Procurement


Breakthrough Performance

Step Change in Productivity

Big Increases in Speed and Efficiency

Optimized Utilization

Radical Gains in Compliance

Substantial Cost Savings

Significant Risk Reduction

Whole Process Control and Visibility

RESULTS OF DIGITAL TRANSFORMATIONTECHNOLOGY DRIVERS

Unified Platform

User Experience

Mobility

Big Data & Analytics

Artificial Intelligence

Internet of Things

Digital Supply Chain

Blockchain

3-D Printing

Transformative Technologies for Procurement


• Connected and Integrated

• Information Boundaries blurring

• Sensitive and personal information is spreading

New Technology means New Risks

Information Security demands a new perspective


If Blockchain is so safe…

New Technology means New Risks


2014 2015 2016 2017 TODAY

Social Media Mentions of "Artificial Intelligence“ show 25% annual compound growth

AI – Hype or Here?

Source: Whit Andrews, Gartner


• AI is here to stay

• It will improve: progressively and in leaps

• It is a powerful tool in the professional’s kit

• AI can become an enabler

• But will we still be relevant?

AI – will we be replaced?


Advanced Guided Buying

Automatic Approval / Routing

Auto Payables

Risk Alerts

Error Discovery

Utilization Prediction

IoT-Mediated Action

Bot-Mediated Bidding

Automated Bid Analysis

Automated Strategy Definition

PredictiveAnalytics

Compliance Alerts

Where AI may live in the Source-to-Pay Process

Utilise the contracts

according to the agreed terms to deliver realized

value

Manage the supplier

relationships and risks to ensure

contract compliance



efficiency





in contracts

Enhanced User Experience – Comfort-Zone-Centric Workspace


Technology can drive the change that’s needed

“Use Simplicity to Fight Complexity”Prof. Julian Birkinshaw, London Business School

$$

Speed• Increased cadence• Reduced cycle times

User Satisfaction• Optimum Adoption• Maximum Usage

Simplicity• Promotes compliance• Improves productivity

Scalability• Ease Drives Global Roll-Out• Future Changes Adopted Quickly

Revenue and Value• Fast, Efficient Processes Increase Output• Users Free to Explore New Value Sources

Savings• Compliance and Utilization• Adoption Directly Drives Savings


The expectations users have of their technology ultimately affects success

Why do users’ opinions (and consumer demand) count?

$$User

ExpectationsUser

AssessmentUsage andAdoption

BusinessImpact

Return onInvestment

If the software presents the right USER EXPERIENCE the ROI is maximised

User Experience (UX) combines product aesthetics, behaviour and functionality – it is not “look and feel”


Why is User Experience important?

Encourages adoption…and thus ROI

(utilisation)

Competes in B2B spacewith B2C expectations

(engagement)

Aligned with yourstrategic aims(compliance)

Procurement can lead business transformation

(success)

The User Matters


• Technology Influences our behavior and expectations

• Technology has changed…• How we play

• How we work

• How we behave

Changing Our Behavior


• Through enforcement: No PO, No Pay” • Does enforcement work?

• Correct behavior = a smooth process. An easy process = correct behavior

• BUT processes are hardly ever easy• Not because people don’t want to follow them!

• Process and tools can be too hard, too difficult to follow, or hidden

• Technology can be that enabler

• User experience can change user behavior

• Ease of use and clarity drive compliance.

Changing Our Behavior


• Bricks & Mortar Retail Giant• High(er) staff turnover

• Business Focus is Revenue (not indirect procurement)

• Workforce used to mobile phones,

ordering online and the B2C experience

“Ordering for the store should be no different”• Long or purchasing processes will impact store performance

• …and be ignored

The case of B2B with a B2C flavor


• User Experience Matters• 10 screens or fewer

• “Invisible” change

• Procurement owned, controlled and driven

• Improved visibility, better accountability and a significant boost to savings initiatives

• This is far from unique to Retail

Companies today are basing their decisions on UX and not on feature and function alone.

The case of B2B with a B2C flavor


The Digital Workplace

• Procurement needs connected processes and greater speed to value

• That is driven by UX, unification of technology and innovation

• IT can help and guide Procurement as part of a global Digital Strategy


Dan HuttenlocherDean and Vice Provost, Cornell Tech

Technology WILL change the workplace


Predicting the future… ...from 1953

“The average working week was now about twenty

hours - but those twenty hours were no sinecure.

There was little work left of a routine, mechanical

nature.

Men's minds were too valuable to waste on tasks

that a few thousand transistors, some photoelectric

cells, and a cubic metre of printed circuits could

perform.

There were factories that ran for weeks without

being visited by a single human being.

Men were needed for trouble-shooting, for making

decisions, for planning new enterprises. The robots

did the rest.

The existence of so much leisure would have created

tremendous problems a century before. Education had

overcome most of these, for a well-stocked mind is

safe from boredom.”


Everything has to change. So…which way forward?

The most dangerous phrase in the language is:

"We've always done it that way“

Grace Hopper


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procurement transformation and the digital workplace · the digital workplace •procurement needs...

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