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Supply Chain Mgmt. Review

Digital Procurement: The Benefits Go Far Beyond Efficiency

Digital Procurement: The Benefits Go Far Beyond Efficiency

The economic and strategic benefits of digitizing procurement are real, but the proliferation of competing technologies has made it difficult for companies to figure out where to start.

  • 2019년3월6일
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Article

Digital Procurement: The Benefits Go Far Beyond Efficiency

This article originally appeared in Supply Chain Mgmt. Review.

After months of making her case, the chief procurement officer (CPO) of a major multinational walked out of the executive team meeting with a big win—approval for a customized manufacturing process to help speed a new product to market. Her procurement team not only identified the emerging technology, it developed an innovative partnership agreement with two suppliers to codevelop it.

It all began six months earlier, when a business unit leader invited the CPO to brainstorm with his team on how to get a new product to market rapidly. The CPO knew two suppliers, one of which was breaking ground on an innovative production process for rapid prototyping and another using advanced analytics to accelerate design. She proposed co-developing a customized manufacturing solution with the two suppliers. Procurement would orchestrate an agile team to test the process and, if successful, make the case for investing in the new technique. The business unit leader was thrilled.

Leaving the meeting, the CPO mused that five years before, she wouldn’t have even known about the suppliers’ innovations—or dared to propose that her team help develop a customized manufacturing solution. Most of procurement’s time back then was spent on tactical activities and buying products that the business units ordered. The rapid emergence of shared data platforms and emerging technologies created an opportunity for procurement to speed innovation.

Read the full article at Supply Chain Mgmt. Review.

Coleman Radell is a partner in Bain & Company’s Performance Improvement practice in the firm’s Los Angeles office. David Schannon is a partner in Bain’s Performance Improvement practice and is based in the company’s Silicon Valley office.

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