Building Procurement Influence Series:
Part 2 - Technology & Procurement Influence

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Transcript

Dan F: What role does technology play in improving Procurement’s influence? 

John P: Well, it’s one of the main categories we see when we do our work. It’s the driver to the functionality and the operations that businesses are trying to get to. 

The challenge that we often have in this is that, we’ve got non-technical people trying to understand technology and how it influences their operations. It’s really important that we understand what’s happening in the market, and particularly, having that literacy around what is happening and what you’re able to do to improve your operations and supply chain functions, or going from on-premise to cloud technologies. All these things are moving quite rapidly. 

And we’re seeing real influence on AI technologies and how that can be done to improve functionality. But I think the challenge with this is – and I think this makes people nervous – that there’s this functionality that’s out there, this utopian idea that this is going to fix everything. It might create efficiencies in areas, but we want to make sure that people aren’t going over too much around introducing AI when the organisation’s not ready. So, the challenge with this is making sure that you can use AI in the areas that you want, and making sure that business people understand that. And it’s not about choosing the technology, it’s about choosing the time to introduce technology. 

I think the biggest challenge that we have to influence our business is to help educate technical people to take the right opportunities at the right time, and to pick the business moment to introduce technology, not pick the technology. 

There’s a lot of technology out there, but I think it’s really important that we influence in ways that make sure people take the right risks around technology, and that they don’t take risks that are too high for their organisation. 

Dan F: So, data is really a subset of technology, and we often say that it’s really hard to be strategic about procurement if you don’t have good visibility of spend data. What role does data play in procurement’s influence? 

Dan R: Absolutely. And I think going back to the point on AI that’s helping us clean the data a lot quicker, there’s still the issue with mountains of data, and there’s more data available now than ever. But I think procurement is an early adopter of AI technology in this space and what it’s helping us do is put some credibility and science behind our cost savings programs. Better quality data is getting us to focus more on the right areas to deliver savings for a business. So, that’s how we’re creating more influence through, say, the CFOs in an organisation, by more credibility around what we’re proposing on these savings programs.