B2B Payments

Procurement Professionals Unhappy With Tech Options

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Procurement professionals aren’t happy with the technology available to them, finds a new report from Consero Group.

The firm’s 2017 Procurement and Strategic Sourcing report, released this month, identified significant gaps in the technology and resources available to procurement professionals today and found common ways these executives are looking to improve their own experiences. For instance, more than half (54 percent) said they plan to invest in spend analytics technology this year, and nearly half (46 percent) said they will increase their use of eProcurement solutions.

Two-thirds say they already increased their use of data metrics to evaluate procurement processes last year, but 82 percent said they are still unhappy with the level of visibility their current data analytic solutions provide them.

“The procurement department requires a strong technology foundation in order to control costs, manage supplier relations and generally execute the function effectively,” said Paul Mandell, cofounder and CEO of Consero, in a recent interview with SCMR. “To that end, chief procurement officers should consider spending more time and energy in the coming months to identify and close technology gaps, as well as improve data management and analytics within their departments.”

Their overall dissatisfaction with the data technologies at their fingertips is revealed at a critical moment for enterprises everywhere as cybersecurity concerns continue to grow. Procurement officials, Consero found, are similarly worried about cybersecurity, with nearly half (49 percent) citing the issue as their top area of risk this year. Cybersecurity topped the list and was followed by third-party contracts and regulatory compliance.

Procurement executives said their vendor partners aren’t helping in this area, either.

Researchers found 86 percent of these professionals say they do not believe their suppliers are paying enough attention to risk mitigation. According to reports, this concern could be why only 15 percent of procurement executives say they plan to outsource more of their operations this year.

But these executives have to juggle other concerns, too: According to Consero, cost control is their top priority for 2017, with more than three-quarters of those surveyed identifying this challenge; Consero noted this focus may contribute to procurement officials’ increasing interest in spend analytics technology.

There is another issue, too: Procurement executives say there is a skill gap in their industry.

“As to particular skill gaps,” said Mandell, “only 22 percent of CPOs noted that their teams lack technical experience, while 44 percent identified relationship management skills as a departmental need. This provides a good reminder of the importance of staying focused on soft skills in an area of increasing technology.”

More than half (51 percent) of the procurement professionals surveyed said their field lacks a sufficient talent pool of trained procurement talent.

The eProcurement space is evolving, as separate research has shown. Reports late last year from Intershop Communications AG found procurement officials’ rising use of digital, online and mobile platforms to research products, with increasing demand for flexible and custom payment options and a more B2C-like buying experience. But while corporate buyers’ demands are forcing suppliers and vendors to shift the way they meet their clients’ needs, the data from Consero suggests internally that the procurement function is also struggling to keep up with changing times.

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NEW PYMNTS DATA: HOW WE SHOP – SEPTEMBER 2020 

The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

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