I read an interesting research report from SAP (other software vendors are available 😉) and Oxford Economics this week.

Focused on challenges and successes of both the “Best” and “The Rest” in Procurement Transformation, it raises issues that span far wider than this function alone.

The researchers surveyed 1,000 global executives to understand how they address the combined challenges of managing spend, controlling costs, enabling suppliers and navigating a changing risk landscape.

Here’s why the findings apply to us all, irrespective of the function, process or organization unit you represent;

• Organizations are having mixed success with process automation – 37% report that most of their processes are still manual. 71% of leaders, compared to 56% in general, confirm that digital transformation has improved automation of routine tasks. This, however, hides a key “Quick Win” addressed by leaders, which is to treat “elimination as the best form of automation”. 

• Only 54% feel able to make “data driven decisions”. Leaders are further ahead than others in overcoming barriers to data-driven decision-making. However, they are still struggling to source the right skills and break down data siloes. 40% of leaders and 60% of others struggle with the ability to “make sense” of their data.

• Leaders are having greater success in driving adoption of new processes and technologies which, upon reflection, is self evident! This does speak to the critical need for effective change management, to engage all stakeholder groups, understand human behaviours and the “WIIFM”. Leaders are more adept in this crucial area.

• End-to-end process alignment is key. 41% of executives state that low adoption of new process and technologies within their own function is a barrier for end-to-end transformation. This makes perfect sense, but without end-to-end process alignment, a broad stakeholder coalition with an agreed case for action, this will always be the case.

• Despite transformation successes, 9% of leaders and 24% of others are still experiencing “maverick”, uncontrolled spend (a behavioural, change management challenge). Whether leader or laggard, at least 1 in 4 leaders are still experiencing overcharges and duplicate payments. 

There is one topic in the report that I remain cautious on. I am sceptical that executives should know whether the technologies in use are employing AI/Machine Learning techniques. We all use technology every day that use these capabilities without our knowledge. I would prefer we focus on outcomes rather than focus on ticking a technology “box”. This may indeed prove to be one of the barriers to progress!

You can read the full report from SAP and Oxford Economics here . . .

There is much to dig into, whatever your function.

Thanks for reading . . .