Every year, The Hackett Group conducts an in-depth key issues study. The latest study focuses on Procurement’s transformation journey including the goals and obstacles limiting progress. Further, to bridge the digital transformation gap, the report digs into technologies that an increasing number of Procurement organizations are planning to adopt over the next 1-2 years. The report also provides a view into Procurement resources in 2019 and projected business risk that CPOs should be aware of.
We know that Procurement is going through a huge transformation, and we know that some departments are charging ahead while others are just getting started, but this is what The Hackett Group says Procurement teams are evolving into in 2019 and in the years to come.
Procurement Departments are going to have less budget (1.3%, versus 2.7% last year) with focus on these areas as a priority:
- Improve analytical capabilities
- Align skills and talent with business needs
- Leverage supplier relationship management (SRM)
- Improve procurement function agility
- Improve customer-centricity
Nothing new or shocking there – although what is new is that “doing more with less” is not quite the annoying mantra it used to be. What is clear is that Procurement teams see Digital Transformation as key to success in 2019 and beyond, and this is because the technologies exist, or are rapidly being developed to provide the tools that Procurement needs.
Procurement teams not only need to recruit new job profiles to handle real-time Spend Analysis and develop new skills in Customer Service they need a first class set of Digital tools to deliver way and beyond what Procurement has been capable of to date.
Procurement teams in 2019 are investing in are Data Visualization tools 59% this year, 73% over the next 1 -2 years but also Master Data Management, 77% over the next 1-2 years and technologies like RPA and Advanced Analytics score high. On the side of Procurement-specific technologies, eProcurement, Supplier Relationship Management and Spend Analyses and Optimization score in the 90s over the next 1 – 2 years, although eProcurement is clearly a priority for most Procurement Departments now.
The report concludes with a set of recommendations to get Procurement Teams on the right course with recommendations in talent acquisition to collaborate with HR organizations to create comprehensive talent development programs to remedy known deficiencies through to Customer Relationship Management.
To read the report in full, please click on the link Group “Leveraging Digital Tools in 2019 to Expand Procurement’s Capabilities” (published January 2019)
To attend the upcoming Webinar Procurement Key Issues 2019, 26th March, Register here