2024 GLOBAL SRM RESEARCH REPORT
TECHNOLOGY
72
73
A connected supplier management technology can profoundly impact the effectiveness of an organisation’s supplier management programme. It not only streamlines and standardises processes but also enhances the consistency and accessibility of data, which improves the ability to monitor and assess metrics. Although there is a recognised appreciation for the importance and benefits of the right dedicated technologies, this recognition has not yet fully translated into the adoption of a comprehensive digital strategy this year, with organisations reporting mixed satisfaction levels with their technology stacks. Many companies continue to depend heavily on basic office tools for managing supplier activities, focusing on early procurement activities rather than assuring and releasing contract value. Only isolated solutions are in place for contract and enterprise risk. Consequently, risk activities are often limited to one-off exercises, as opposed to continuous risk management. Additionally, performance and relationship management often lack a unified platform that can seamlessly consolidate activities. Two key insights are raised in this year’s research. Firstly, it appears that supplier management technology is still in the process of expanding away from traditional procurement and pre-contract award activities. Organisations (particularly Leaders) use dedicated systems for sourcing and contract management, but this has not yet spread widely into performance and relationship management – the key activities which unlock additional value in relationships and deliver return on relationships. Instead, across all maturity levels, organisations still see office tools as the go-to solution. These solutions are not adept at tracking initiatives, actions and value, and their manual nature can also take up a significant amount of time to manage (with increased risk of errors), taking valuable time away from analysing results and driving collaboration and innovation. Secondly, the isolated data silos across an organisation’s tech stack complicate decision-making regarding investments in new systems, particularly in AI and automation. Despite market hype around these technologies, only a small percentage of companies can clearly identify or fully utilise the benefits they offer in the supplier management space. This indicates a gap in understanding how AI and automation can effectively support their operations. The key opportunities in technology are: • Define a business case for technology that meets the needs of the business while also aligning with supplier management processes and strategy. • Review the current state of supporting technology against the organisation’s supplier management needs. • Align any technology investment with the long-term vision for supplier management.
“It is crucial for an organisation to first understand the benefits of supplier management technology. It can be game-changing to facilitate and support key activities, and provide better collaboration and transparency, but it should be pursued in collaboration with the other pillars of supplier management.”
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