Every day, we hear news about disruptive technology. Blockchain, artificial intelligence, the Internet of Things. These innovations have the potential to change the way we work at an unprecedented speed and scale. We live in a data-driven world enabled by complex global supply chains. Though B2B technology is slower to adapt than B2C, change is a matter of when, not if.
Leading a software company in the procurement industry, I try to keep a balance of 70% innovation and 30% business functions when thinking about our execution. As a startup, we’re familiar with the concept of “working in” versus “working on” a business. We have to support and maintain fully-fledged solutions for our clients (“working in” our wheelhouse, so to speak). But we also need to think ahead to stay relevant in the industry (“working on” our evolving business model and product development).
This analogy is similar to the way technology enables procurement professionals. Digital solutions like e-procurement and rote automation frees up resources (money, time, and expertise) for procurement leaders to concentrate on tasks such as supplier development and sustainable sourcing. Implementing these new strategies can foster competitive advantage with your organization’s supply chain and its key stakeholders.
So how can you optimize technology to “work in” your business while you “work on” your supply chain? The most important first step is establishing your baseline of where you are, before mapping out where you want to go. Assess the market and analyze your spend data. Most buying organizations have information scattered across various departments and silos, held by legacy ERP systems that weren’t designed for this type of relational data. A key place for many firms to begin automation is within their supplier data enrichment and reporting process.
Third party platforms that specialize in supplier diversity and management have access to databases that clean up and match vendor data with a high percentage accuracy. We can view real-time, in-depth information in a centralized location and make better business decisions as a result. Automation is also useful in reporting requirements because it fills the need for multi-tier spend tracking, which is a growing concern for many corporate buyers. Multi-tier reporting fulfills government regulations, audits, and the corporate responsibility measured by social and economic impact of spend.
Ultimately, it’s important to be intentional with the way you use technology. The key to being nimble and mighty is to embrace innovation with a keen eye on how it affects performance. If digital solutions are applied strategically, they can improve ROI and a firm’s bottom line.
Daryl Hammett is the COO and co-owner of ConnXus, a SaaS-based global supplier management platform. He previously founded the Peabody Executive Coaching Group and led Luxottica’s Sears Optical North America as senior VP and general manager.