The global procurement software (digital) market is expected to grow at a compound annual growth rate of 10.2% by 2025.
With advances in technology, CPOs are accelerating digital transformations in their organizations to meet new business needs.
Procurement process and performance management digitalisation is becoming an imperative as procurement teams look to improve the user experience at the same time as optimising the performance of the function.
In a recent report from Per Angusta and Procurement Leaders, Dr Elouise Epstein, Partner at Kearney highlights that the experience with most procurement technology has been horrible and ROI has been inadequate, where
“many organisations have been severely impaired having overpaid for technology that has vastly under-delivered”.
“People are still reinventing the wheel” says Pierre Laprée, CEO and Founder of Per Angusta. He believes “many organisations’ Procurement functions are less mature and often lag behind in terms of their strategic technology deployments”. Procurement departments are the worst equipped functions and are having to play catch-up as they are unable to fulfil successful digital transformations.
For example, sales teams benefit from tools such as Salesforce and CRM systems and HR uses well defined KPIs and tracking systems – so why can’t procurement have access to tools and systems that are just as vital for elevating its function?
Procurement is an under resourced function, however, the digital procurement solutions market is growing and seeing major investments in startups fulfilling major needs. This is supported by Dr Elouise Epstein, who says digital tools and technologies can increase the strategic value procurement functions are able to deliver to the wider organisations in which they operate.
For procurement performance management digital solutions there are some clear objectives to satisfy which include information sharing, collaboration, agility and operational efficiencies.
Per Angusta recommend 6 steps for procurement leaders to optimise procurement performance management.
1. Identify opportunities.
2. Prioritise projects.
3. Forecast outcomes.
4. Collaborate cross-functionally.
5. Measure progress.