What Skills Will Procurement Need in the Future? Five Experts Predict How Procurement is Changing

Monday, December 17, 2018

Looking back over the procurement trends of 2018, there has been much talk about the digitisation of the procurement function and the possibility that machine learning, robotics and AI will gradually take over much of the operational side of procurement.  We asked a selection of CASME facilitators around the world for their views on whether this is just hype or reality, and what skills the procurement executives of the future will need.

 

David Natoff, CASME Facilitator, Europe
The impact of digital for procurement is enormous.  I am already seeing a significant transformation and this can be broken down into three areas: transactional, tactical and strategic. The transactional, procure-to-pay world is becoming completely automated and for organisations looking to embrace digital solutions the path has never been easier. Tactical work tends to require specialist knowledge and therefore may require limited decision-making. There is a lot of automation being introduced in this space and we are seeing chatbots becoming more prevalent, but it will take time before robots completely take over due to the financial investment required. In strategic areas such as category management and stakeholder/supplier relationship management, technology will augment our work including using big data and predictive analytics to get information quickly to our fingertips and support more informed decisions.

The skill sets we need in Procurement are changing but this is also because we are becoming more value focused. Procurement is transforming and I believe we have to focus on our stakeholders to achieve value as opposed to focusing on cost to achieve savings. Procurement needs a diverse team of many different skill sets. It needs people with high EQ as well as high IQ. It needs resources with strong analytical skills and you may see data scientists joining the team in the future.

 

Jeff Devon, CASME Facilitator, North America
I am very excited about the growth of machine learning and the prospect of AI taking over much of the transactional side of procurement! While the adoption is gradual for now, freeing up time from transactional tasks will allow Procurement professionals to elevate the value we provide for the enterprise. Having bandwidth to truly understand the business needs and how they operate will make us better partners with our stakeholders. Devoting time to studying our key suppliers such that we know when they are struggling and when they are having successes will help us better leverage and time our negotiating cycles.

Knowledge of the suppliers’ industry by staying informed of consolidations, expansions and evolution of the supply base presents opportunities to demonstrate that we are truly bringing value to our business partners. Moving our performance well beyond transactional buying and into developing supplier strategies in conjunction with our business partners will truly allow us to have a place in the executive suite.

 

Marie-Claire Marquis, CASME Facilitator, Australia
Digitalisation is very much a part of Procurement today and there is always intense interest at CASME RoundTables about technology advances in general and how organisations are using the technology to become more efficient.  This ranges from automating reporting and measuring supplier KPIs and is expanding to areas such as the automation of processes. 

Automation and robotics are being used in areas such as invoice validation, tender analysis, fraud detection and user set-ups. This move frees up Procurement to spend more time with the business and to understand how Procurement can support stakeholders and add value. It requires us to use more of our soft skills whilst also being open to managing and delivering change.

I have led many automation projects – the two that have realised the most benefits in my view were the automation of the Purchase Order creation and invoice validation process.  These automations have really given both the wider Procurement team and myself the time back to focus on the stakeholders and their needs. 

 

Bill Young, CASME Facilitator, Europe 
Digit-al-isation “They called me 'Al'.  

Procurement is up to speed on digitisation. It is not difficult: just follow suppliers and clients as they go paperless and use tools to streamline analysis, recording and reporting.

Digitalisation is a different matter.  Often confused with digitisation, digitalisation is more than streamlining existing processes, it is the creation of a new business model.   Nobody is yet applying machine learning to category management, which is a repeated process like many others.  If digitalisation can enable machines to drive cars in city traffic and outperform lawyers[ii], it can surely make category managers redundant. 

“It was 'Al' all the time. Say buddy, can you spare a dime?”

 

Brian Cunningham, CASME Facilitator, North America
My experiences while facilitating CASME RoundTables over the past year have validated the fact that, regardless of the category being discussed, the topic of automation and digitalisation is pervasive throughout. Collectively, the input shared emphasises the impact that digitalisation will have on procurement professionals and will signal dramatic change as the procurement function becomes digitally connected for complete, real-time visibility.

Predictive modelling and forecasting, advanced analytics, artificial intelligence and robotics amongst other technologies will provide automated data population regarding market intelligence and will enhance decision support-making favourably for Procurement projects and proposed solutions. It is essential that Procurement managers and executives recognise this impact and immerse themselves in the learning curve both personally and in preparing the selection criteria for incoming, technically competent talent.

In my opinion, Procurement has a unique opportunity to champion the change management process required to optimise digital improvements while maintaining the existing corporate culture. A digitally enhanced procurement workforce can significantly elevate the reputation and strategic importance of the function, offer critical value-added services and demonstrate consistent credibility to stakeholders, senior management and suppliers.

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CASME would like to thank all of our facilitators for their in-depth insights and contributions to our annual RoundTable and Virtual RoundTable programme. 

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