It’s tough times for procurement teams who stick with a few suppliers (and beat them down on price yearly), manage only a few spend types, obsess over dated measurements (like purchase price variance or PPV), and regard supplier management and accounts payable as distant entities. More ambitious counterparts in competing companies are breaking the mold to drive greater value.
Sadly, many organizations are stuck in the old mindset. Maybe that’s why many in the field want out or wonder how they got there in the first place. But it need not be that way, and we’ve been advocating for better technology that can change the work experience and make procurement more effective – even liked.
Before you make any decision to update your technology, remember that no solution is a silver bullet. You, your people, your culture, and your processes need to be ready (or at least willing) to change, too.
Here’s a quick and easy way to tell if you’re probably not ready yet for eProcurement from Tradeshift:
- You enjoy crafting nebulous goals that loosely connect your P2P processes with your overall procurement objectives and metrics.
- Your task is really just to ensure supply without slowing down the business – anything else should mean employee recognition.
- You deem basic technology usage as good enough, because “basic” is what your mission statement is all about.
- The UX of your procurement solution doesn’t match your buying process because it has an overly complex and ugly interface that only your CPO can love.
- Incumbent relationships and “the easy answer” drive your decisions because, well…you need to check the results of the Oscars office pool, so…
- Your CPO is more concerned about his golf swing than your ad-hoc visibility into spend.
- Your business users make buying decisions with limited information and everyone’s cool with it.
- You kick off your call with a potential vendor with, “Hi, is it Jeff?.. so $4.50 per unit is just too much for us, can we talk about that first? And what assurances can you provide that you will deliver on time?”
- Your suppliers control information flow so when you have incomplete or inaccurate data, you resort to a phone call or email to patch it up.
- Since you’ll never have all spend under management, why bother trying for the next 10%?
In all seriousness, if you’re interested in finding out what modern and business-enabling procurement looks like, check out this insightful 8-page report “Reframing Maturity Models: Empirical Perspectives On Radically Improving Procurement Performance” written by top dog at Spend Matters, Jason Busch.
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