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Driving the digital shift in procurement: invest or postpone?
Over 1,500 procurement leaders including Centrica, American Express, KWS, ISS, the United States Air Force, Telefonica, the Academies Enterprise Trust and the American International School in Vienna joined Amazon Business Exchange 2020
on 08 October, 2020
As Procurement Leaders research1 shows, 25% of procurement leaders have recently accelerated their digitisation process, while 27% have opted to postpone. Some organisations are thriving in this new, rapidly changing environment and using digital procurement to capitalise on shifting buying trends and supply chains.
Digital procurement enables a decentralised workforce to quickly get what they need, within visibility and control. Some organisations have been able to quickly transition from paper-based processes to digital, and automate tasks to create more agile environments. They demonstrate procurement value that goes beyond cost control, improving their business resilience and increasing operational efficiency.
Invest or postpone? Decentralise or centralise? Deploy new technologies now, or wait? This year’s Amazon Business Exchange (ABX) focused on the stories and best practices from those who are either staying the course or even ramping up and accelerating digitalisation processes to successfully manage business challenges in ‘the new normal’.
Digitalising procurement to respond in an agile, rapid way
Peter Sowrey, Chief Procurement Officer & REFM at Centrica UK, spoke about how COVID-19 has provided opportunities for his team to accelerate their thinking on how to make their processes quicker. He discussed how Centrica partnered with Amazon Business to reduce their process steps in order to create a more efficient and nimble system. By eliminating inter-mediaries, and "driving from complexity to simplicity”, the organisation could respond more quickly to customers whose heating had failed in winter and needed an engineer to fit a replacement heater.
Helen Baker, Procurement Director at the University of the West of England, Bristol, discussed how the institution’s online procurement system was critical to responding to the challenges created by the pandemic. With 4,000 students normally living on campus, and at least 1,000 unable to return to any other property when the UK lockdown was introduced in March, the university had to deliver laptops, food and materials for student projects. With 150 employees with purchasing cards, the university could quickly and simply adjust their category and spend thresholds so they could buy the items needed by students and staff working from home, thanks to a flexible digital procurement system. As the process was moving increasingly online, Helen’s team was able to learn from the experience during the pandemic and ‘take forward some of the sourcing opportunities and ways of behavior for the future, emphasising the importance of supplier relations.’
The importance of flexibility and range in an online procurement system
With clients including Barclays, Heinz and Leonardo, it was important for Danish organisation ISS to have a flexible online procurement system to enable the team to adapt to the changes produced by the pandemic. Gemma Lindley, Procurement Business Partner at ISS, talked about the importance of achieving a “balance between flexibility and control.” As the organi-sation’s priorities changed due to COVID-19, it was critical to be able to change the restrictions in their procurement system to respond to the shift in priorities. “Ensuring you have that flexibility and a process whereby you can adapt the end solution is really key,” she said.
Tom Fuchs, Purchasing Officer at the American International School in Vienna, discussed the importance of choosing an online procurement system, which offers a wide range of products. Access to a vast selection of textbooks, world maps and similar academic materials, with fast, free delivery, gives teachers the supplies they need to deliver high-quality education. Tom also talked about the value of a digital procurement system with strong invoicing capabilities; those available through Business Prime allowed Tom’s team to reduce processing time from up to five days to less than one.
The Academies Enterprise Trust was another organisation demonstrating an agile response to change. Deputy Finance Direc-tor Kyush Modesai spoke about how the COVID-19 pandemic led the team to fast track their procurement strategy, generating cost savings, which they used to buy over 12,000 laptops and 3,000 Wi-Fi dongles. These enabled the Trust’s most vul-nerable children to access remote learning during the lockdown period.
The vital role of procurement in solving strategic organisational challenges was demonstrated by numerous speakers at the ABX conference. Company leaders and procurement experts from small businesses, schools and universities, as well as large enterprises with tens of thousands of employees joined the conference, which took place from 6 to 7 October online.
The event is available on-demand at events.amazonbusiness.eu until 7 November.
1Procurement Leaders’ Leading Through COVID-19 Report