Top Five Procurement Trends 2019: Cloud, Blockchain and AI to Dominate
Procurement Trends 2019: Technology and digitalisation are dramatically changing customer experiences and expectations. Within the rapidly changing and increasingly computerised world, procurement has evolved from an operative, administrative system to a more strategic function. To match the pace of continuous evolution, the purpose of procurement has changed from cost-cutting to value generation.
1. Supplier Rationalisation
Owing to GST compliance, managing ‘tail end’ of the spend effectively will become a priority and therefore, companies will strategically partner with aggregators who can act as a one stop solution for all their indirect spend requirements. As a result, upcoming year will see organisations moving towards supplier rationalisation to ensure GST complianceand for effective supplier relationship management.
Blockchain will be used across multiple applications to transform procurement– from enhanced contract management to tracking of goods to payment processing. With its enigmatic features of secure collaboration for contracts, digitisation, synchronised information management, integrating this emerging technology into e-procurement systems could provide greater security, trust and transparency. Blockchain will enable enhanced contract management, e-sourcing and e-auctions by enabling the adoption of mobile e-auction apps through both public and private keys. Application of Blockchain will provide detailed specifications and lead times update in catalogues on a real time basis. As a secure network, it will provide safe access to suppliers to register and update banking information for payments and also has the ability to integrate treasury with banking for electronic payments. Adoption of Blockchain will also help to provide confirmation of price and delivery using smart contracts will enables supplier-triggered payment.
3. Cloud-based collaboration
Moreover, procurement trends 2019 will witness cloud-based platforms being used to streamline buying as well as selling of complex services and products by integrating P2P (procure-to-pay) solutions with online marketplaces and online catalogues of external suppliers.
Overall, this will enable all the users in the supply chain to have real time access of data independent of location and time. Increased collaboration will allow buyers to have a holistic view of prices and products, which, will help sourcing managers to make an informed decision on supplier and product selection. While suppliers will be able to plan their inventory and production, accordingly, helping in achieving cost savings and efficiencies while simultaneously reducing risk and waste.
4. Data based decision making
Data is the new oil that provides us with deep insights to help us make decisions that drive profit and ensure growth. 2019 will be year of using emerging technologies to convert data into information to improve purchasing power, improve spend management and help mitigate risks. Data will not only provide actionable insights to category and sourcing managers but also facilitate in decision making. Natural language processing combined with machine learning will be used to classify data and draw insights; offer suggestions unique to the user as well as the situation the user is in. Further, 2019 will see rapid adoption of chatbots and virtual assistants for guided buying on a long-term basis.
5. Next-gen technologies and automation
Despite the procurement trends 2019 predictions as discussed above, the primary and critical functions of procurement of helping reduce costs by getting best prices for quality goods and services will however remain unchanged. The upcoming year will be more about emerging technologies driving transformation in procurement function. In 2019, technological trends like machine learning will augment existing solutions and deliver smarter insights to procurement.
Source: https://techobserver.in/2018/12/25/five-top-procurement-trends-2019-cloud-blockchain-and-ai-to-dominate/ (As appeared on Tech Observer)