Digital Procurement Takes Flight

New survey shows companies betting big on technology to transform function; results to be shared at SAP Ariba Live Amsterdam April 23-25

PALO ALTO, Calif., April 10, 2018 – For the last 20 years, procurement has slowly been transforming from a tactical, manual process to a strategic digital function. But things are about to take off. According to the results of a new global survey conducted by the University of Applied Sciences Würzburg-Schweinfurt with support from SAP Ariba, leading procurement organizations see digitization as the future. And they are investing heavily in technologies that beyond automating things and saving money, can help them drive business innovation and make a difference in the world. The results of the measure will be shared at SAP Ariba Live, the premier global commerce conference that kicks off April 23 at the RAI Amsterdam.

“The message is loud and clear,” said Prof. Dr. Karsten Machholz, Strategic Procurement & SCM, the University of Applied Sciences Würzburg-Schweinfurt, co-author of What’s the Next Big Thing in Procurement. “Procurement executives around the world believe digitization is more critical than ever. And they are taking steps to accelerate it within their organizations and increase the value they deliver.”

To understand their goals, Machholz joined forces with SAP Ariba to survey more than 450 procurement and supply chain executives across EMEA, North and South America and Asia Pacific. The study covered all major industries and included blue chip enterprises and mid-market companies alike and found that:

  • The journey is just beginning. While 83 percent of respondents believe digitization will profoundly impact their business, only five percent have highly automated processes in place.
  • Procurement has a conscience. Savings are still their number one priority. But 88 percent of procurement executives surveyed have higher objectives – such as eliminating forced labor, conflict minerals and poverty from their supply chains – and see the value in helping their companies both do good and do well.
  • Things will get smarter and faster. Robots won’t replace buyers, but alongside artificial intelligence and machine learning, they will make them more intelligent and efficient. And to this end, more than 60 percent of respondents plan investments in robotic process automation (20 percent), artificial intelligence/cognitive computing (17 percent), machine learning (15 percent) and chat bots (nine percent).

Digital transformation isn’t without its challenges. “Within many organizations, insufficient analytics, poor data quality, budget restrictions and lack of talent are creating roadblocks,” says What’s the Next Big Thing in Procurement co-author and SAP Ariba Chief Digital Officer Marcell Vollmer.  Among the actions that can be taken to remove them outlined in the study:

  1. Don’t just automate, innovate. Use digital technologies to redesign processes and make them work the way they should.
  2. Cleanse data and leverage intelligent technologies and predictive analytics to make smarter decisions.
  3. Look beyond savings to measure success. Find a purpose – and execute it.
  4. Recognize that companies are only as good as the people they keep. Develop a talent management strategy to advance roles, skills and knowledge.

“Over the next 10 years, companies will see more opportunity than they have in the past two decades combined,” Vollmer said. “In embracing digital technologies and strategies, procurement can take the lead in maximizing these opportunities and beyond delivering cost savings and process efficiencies, fuel innovation and market advantage.”

Thousands will gather to explore what lies ahead and imagine business the way it should work at SAP Ariba Live, the largest gathering of procurement and supply chain professionals in Europe. From dynamic general sessions and interactive breakouts to industry and role-specific networking opportunities and an exclusive Diversity and Leadership forum, there’s something for everyone at SAP Ariba Live. Registration for the can’t-miss event is open today. Click here to reserve your place.

About SAP Ariba

SAP Ariba is how companies connect to get business done. On the Ariba Network, buyers and suppliers from more than 3.3 million companies and 190 countries discover new opportunities, collaborate on transactions and grow their relationships. Buyers can manage the entire purchasing process, while controlling spending, finding new sources of savings and building a healthy supply chain. And suppliers can connect with profitable customers and efficiently scale existing relationships – simplifying sales cycles and improving cash control along the way. The result is a dynamic, digital marketplace, where over $1.6 trillion in commerce gets done every year.