Increasingly, purchasing and supply chain operations are being recognized as strategic functions within forward-thinking OEMs. Now, those same departments are starting to invest in the technology solutions that support procurement.
A recent survey called the "Pulse of Procurement Research Report 2014," sponsored by procurement performance solution vendor Zycus, points to findings that these types of investments pay off.
"The correlation between higher levels of technology adoption and greater procurement savings is compelling," said Richard Waugh, vice president, corporate development at Zycus, in an interview with EBN.
The survey polled 300 procurement practitioners, with three-quarters holding senior executive positions at $2 billion-plus companies in North America.
Top purchasing organizations are more likely to have investments in a fully integrated procurement suite, Waugh told us. "[With] all organizations, whether top-performing or also-rans, there's a unanimity that they will be moving way from ERP or home-grown systems to best-of-breed suites."
Organizations are focusing on implementing solutions that offer supplier management and collaboration capabilities. "These top areas of focus are driven by a need for a more collaborative environment with suppliers," said Waugh.
Other key findings of the study:
- The rate at which organizations are creating enterprise strategic procurement groups has come to a standstill.
- Although procurement organizations continue to move ahead in placing additional spend under management, getting suppliers to adhere to preferred supply contracts, and capturing savings, cumulative cost savings still aren't being maximized by most organizations.
- Organizations continue to invest in process automation and IT solutions for procurement, but there's still plenty of room for advancement.
Procurement professionals have big goals in terms of achieving better results through technology. When asked how they want to improve procurement information over the next five years, respondents answered:
We've invited Waugh to talk about his company's recently released study and to share his thoughts on technology's place in the supply chain. Come by for our EBN Live Chat at 2:00 p.m. EDT (11:00 a.m. PDT) on Thursday, March 27, with your questions and comments.