Continuing our series of procurement and supply predictions, today let’s look at what global provider of research and analytics solutions The Smart Cube has to say.
With thanks to Omer Abdullah, co-Founder and Managing Director.
Responding to COVID-19 has brought the need to be highly agile higher up the agenda for procurement. Category playbooks can no longer be developed annually and put in a drawer, as has perhaps been assumed for many years — rightly or wrongly. Resources, skills and capabilities need to be more available, more quickly and flexibly, to help procurement respond in times of crisis or high demand. Process flexibility is paramount and being able to react quickly to strategic shifts or changes is a core skill and will be in even greater demand as we look to the year ahead.
2. Supplier risk management
As a result of an incredibly turbulent 2020, supplier risk is back on the C-suite radar with a vengeance for 2021. The nature of risk management is also changing, with the emphasis moving beyond Tier 1 suppliers and beyond purely financial risk to cover performance, operations, competition, governance, and more. An effective supplier risk management solution is needed to support not just organizational risk responsiveness but also ESG, reporting, regulatory requirements and so on. It can also help to build and maintain corporate reputation in an environment where competition only continues to increase, and following a year where sustainability has not dropped off the agenda as many assumed it would.
3. Intelligence-led procurement
Procurement professionals are moving more rapidly towards becoming truly intelligence-led, which is driving a greater shift in where their time is spent. Armed with not just data but with analysis and insights, they can understand the internal customer’s business more deeply, assess the implications of changes more clearly, and make more informed decisions to support their partners. In other words, the procurement professional is becoming a more trusted advisor, using analytics and insights to tangibly help move the business forward. And with the pandemic having really shone a light on the procurement function, I expect this trend to accelerate next year.
And continuing our coverage we heard from strategic and tactical procurement services provider Capita Procurement Solutions.
With thanks to Kieran Sullivan, Client Services Director.
1. Social Value
The focus on social value will continue to increase and this will be reflected in the procurement strategy of both public and private sector companies. Some of our clients are asking for the development of Social Value Frameworks to be used in future procurements to support them on this topic, not only at the buy stage where we see their appetite reflected in a minimum of 10% weighting in tenders but also the realization of commitments through the contract lifecycle. Social value comes in various forms and will positively impact both buyers, suppliers and the wider community in 2021.
2. Risk Management
In light of COVID-19 and the EU Exit, supply chain risk management will also be a key focus as companies endeavor to mitigate the varying risks in their supply chains. We observe with our clients an increasing requirement for granular supply chain reviews, the need to keep abreast of supplier financial health and proactive risk identification with actions to minimize potential negative impact. Companies will continue to embed technology solutions from core providers to increase efficiencies and visibility within their supply chains.
Of course given the current economic challenges we see savings delivery being key to all procurement activities!
Thanks to The Smart Cube and Capita Procurement Solutions, and look out for more solution provider predictions over the next few days, with an overall take on the series from our analysts at the end. See all of the 2021 vendor predictions here.
*Please note that the order of vendor predictions in this series is based entirely on the order in which they dropped onto our digital doorstep, nothing more.