ADOPTION OF TECHNOLOGY
We do not believe that technology is a panacea. Neither do we believe that all technology solutions are suitable for all organisations or situations. We tend to refer to it as “enabling technology” that enables the adoption of a process, reduces administration and acts as a change agent in a transformation initiative. We recommend that companies are realistic about their needs for technological solutions and their reasons for using technology. A good system cannot correct a bad process; however, it can help to change it. Adoption of technology should be aligned to procurement strategy and used to support the procurement operating model.
Eight out of 10 have implemented a warehouse management system and 70.1% have implemented a procurement-to-pay system.
Figure 59: WHICH OF THE FOLLOWING SYSTEMS DO YOU USE IN YOUR ORGANISATION?
Spend analysis system Category management system Warehouse management system Procurement-to-Pay (P2P) system
80.5%
70.1%
54%
44.8%
Supplier management system
40.2%
Supplier performance management system
34.5%
Supplier segmentation system Supplier registration system eSourcing system Contracts management system
28.7%
21.8%
20.7%
20.7%
Product development / Innovation system Stakeholder management system
14.9%
9.2%
Risk management system
6.9%
0
10%
20% 30% 40% 50%
60%
90%
70% 80%
The adoption of technology is higher in the operational areas of procurement such as warehouse management, procurement-to-pay and spend analysis, rather than other equally important areas such as contracts management and performance management. The low adoption of risk management systems (6.9%) highlights what has been noted in other areas of this survey – that organisations have not yet put in place rigorous processes for managing supply chain risks, which is a risk in its own right, especially in this volatile environment. Start-up initiatives towards this direction could be internal risk registers or risks and issues logs, which could potentially be shared with the suppliers. We see value in all electronic systems that enable procurement processes and we would like to see more of these systems being implemented in the future. With the emergence and wide acceptance of software as a service (SaaS) platforms, technology investments have become more attractive than ever. Looking to the future, performance management and contracts management systems are the top priorities of organisations, with 48.8% and 41.5%, respectively expecting to implement these. We see this going hand in hand with the development of category management.
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