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Procurement Transformation and the Digital Workplace
GEP
Paul BlakeAssociate Director
1© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
HOW PERFORMANCE-DRIVEN PROCUREMENT GETS RESULTS
THE INDUSTRY’S LEADING SOURCE-TO-PAY PLATFORM
Procurement Transformation and the Digital Workplace
2© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
Agenda
A Productivity Crisis? ①
Digital Transformation and Procurement’s Role in it ❷
Emerging Technologies andwhere they fit ③
Putting People in their Place❹
A Bit of a Case Study⑥
How to Think of the Future❼
3© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
2000 Q1 2002 Q4 2005 Q3 2008 Q2 2011 Q1 2013 Q4 2017 Q2
Output (GVA/GDP)
The Reality of Growth
Source: ONS.gov.uk
85
90
95
100
105
110
115
120
125
4© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
Is technology getting in the way?
"Technology can overload people and make them less productive because they get caught up in it rather than use it to deliver a service or a product.“
"Productivity comes from creative interchange, it does not come from people sitting in front of machines sending emails."
Sir Cary CooperProfessor of Organisational Psychology, Manchester Business School
5© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
Not all technology advancement is helpful
Non-spam, non-relevant email volume by quarter
6© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
“Technology is no longer a tool for
helping the procurement
process. It definesthe process and its
use determines success or failure.”
PEOPLE
PROCESS TECHNOLOGY
Everything has changed
PEOPLE
TECHNOLOGY
PROCESS
7© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
ERP
Software is no longer just a business toolkit
PLANNING
SOURCING
Supplier
Relations Purchasing
Contract
Software is now where business happens
Spreadsheet
Sourcing Tool
8© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
The Procurement Process
Utilise the contracts
according to the agreed terms to deliver realized
value
Manage the supplier
relationships and risks to ensure
contract compliance
Investigate spend history and
activity to identify opportunities for value, savings and
efficiency
Develop plans and strategies to deliver the
potential value and savings identified
Execute the plans through sourcing, negotiation and establishment of vehicles for value
Encapsulate the agreed terms and potential for value
in contracts
Increasing potential to realize savings and valueThis is where
the savings are realized
9© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
The Procurement Process
Operating business
unaware of contracts, prefer
local suppliers or taking a
“path of least resistance”
Supplier Relationships
left unmanaged, compliance to
contracts unmonitored
and negotiated terms lost
Investigate spend history and
activity to identify opportunities for value, savings and
efficiency
Develop plans and strategies to deliver the
potential value and savings identified
Execute the plans through sourcing, negotiation and establishment of vehicles for value
Encapsulate the agreed terms and potential for value
in contracts
Despite the work to set up the value Value cannot become realized
10© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
The IT impact on Procurement
• Digital Transformation is a hot topic
• The Digital Workplace is planned
• Procurement plays an increasingly strategic role in the business
• Procurement and IT each need to understand the other’s agenda
• Procurement is not an afterthought- in fact IT can drive the Digital Workplace agenda forward by partnering with Procurement
11© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
Breakthrough Performance
Step Change in Productivity
Big Increases in Speed and Efficiency
Optimized Utilization
Radical Gains in Compliance
Substantial Cost Savings
Significant Risk Reduction
Whole Process Control and Visibility
RESULTS OF DIGITAL TRANSFORMATIONTECHNOLOGY DRIVERS
Unified Platform
User Experience
Mobility
Big Data & Analytics
Artificial Intelligence
Internet of Things
Digital Supply Chain
Blockchain
3-D Printing
Transformative Technologies for Procurement
12© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
• Connected and Integrated
• Information Boundaries blurring
• Sensitive and personal information is spreading
New Technology means New Risks
Information Security demands a new perspective
13© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
If Blockchain is so safe…
New Technology means New Risks
14© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
2014 2015 2016 2017 TODAY
Social Media Mentions of "Artificial Intelligence“ show 25% annual compound growth
AI – Hype or Here?
Source: Whit Andrews, Gartner
15© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
• AI is here to stay
• It will improve: progressively and in leaps
• It is a powerful tool in the professional’s kit
• AI can become an enabler
• But will we still be relevant?
AI – will we be replaced?
16© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
Advanced Guided Buying
Automatic Approval / Routing
Auto Payables
Risk Alerts
Error Discovery
Utilization Prediction
IoT-Mediated Action
Bot-Mediated Bidding
Automated Bid Analysis
Automated Strategy Definition
PredictiveAnalytics
Compliance Alerts
Where AI may live in the Source-to-Pay Process
Utilise the contracts
according to the agreed terms to deliver realized
value
Manage the supplier
relationships and risks to ensure
contract compliance
Investigate spend history and
activity to identify opportunities for value, savings and
efficiency
Develop plans and strategies to deliver the
potential value and savings identified
Execute the plans through sourcing, negotiation and establishment of vehicles for value
Encapsulate the agreed terms and potential for value
in contracts
Enhanced User Experience – Comfort-Zone-Centric Workspace
17© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
Technology can drive the change that’s needed
“Use Simplicity to Fight Complexity”Prof. Julian Birkinshaw, London Business School
$$
Speed• Increased cadence• Reduced cycle times
User Satisfaction• Optimum Adoption• Maximum Usage
Simplicity• Promotes compliance• Improves productivity
Scalability• Ease Drives Global Roll-Out• Future Changes Adopted Quickly
Revenue and Value• Fast, Efficient Processes Increase Output• Users Free to Explore New Value Sources
Savings• Compliance and Utilization• Adoption Directly Drives Savings
18© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
The expectations users have of their technology ultimately affects success
Why do users’ opinions (and consumer demand) count?
$$User
ExpectationsUser
AssessmentUsage andAdoption
BusinessImpact
Return onInvestment
If the software presents the right USER EXPERIENCE the ROI is maximised
User Experience (UX) combines product aesthetics, behaviour and functionality – it is not “look and feel”
19© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
Why is User Experience important?
Encourages adoption…and thus ROI
(utilisation)
Competes in B2B spacewith B2C expectations
(engagement)
Aligned with yourstrategic aims(compliance)
Procurement can lead business transformation
(success)
The User Matters
20© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
• Technology Influences our behavior and expectations
• Technology has changed…• How we play
• How we work
• How we behave
Changing Our Behavior
21© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
• Through enforcement: No PO, No Pay” • Does enforcement work?
• Correct behavior = a smooth process. An easy process = correct behavior
• BUT processes are hardly ever easy• Not because people don’t want to follow them!
• Process and tools can be too hard, too difficult to follow, or hidden
• Technology can be that enabler
• User experience can change user behavior
• Ease of use and clarity drive compliance.
Changing Our Behavior
22© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
• Bricks & Mortar Retail Giant• High(er) staff turnover
• Business Focus is Revenue (not indirect procurement)
• Workforce used to mobile phones,
ordering online and the B2C experience
“Ordering for the store should be no different”• Long or purchasing processes will impact store performance
• …and be ignored
The case of B2B with a B2C flavor
23© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
• User Experience Matters• 10 screens or fewer
• “Invisible” change
• Procurement owned, controlled and driven
• Improved visibility, better accountability and a significant boost to savings initiatives
• This is far from unique to Retail
Companies today are basing their decisions on UX and not on feature and function alone.
The case of B2B with a B2C flavor
24© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
The Digital Workplace
• Procurement needs connected processes and greater speed to value
• That is driven by UX, unification of technology and innovation
• IT can help and guide Procurement as part of a global Digital Strategy
25© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
Dan HuttenlocherDean and Vice Provost, Cornell Tech
Technology WILL change the workplace
26© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
Predicting the future… ...from 1953
“The average working week was now about twenty
hours - but those twenty hours were no sinecure.
There was little work left of a routine, mechanical
nature.
Men's minds were too valuable to waste on tasks
that a few thousand transistors, some photoelectric
cells, and a cubic metre of printed circuits could
perform.
There were factories that ran for weeks without
being visited by a single human being.
Men were needed for trouble-shooting, for making
decisions, for planning new enterprises. The robots
did the rest.
The existence of so much leisure would have created
tremendous problems a century before. Education had
overcome most of these, for a well-stocked mind is
safe from boredom.”
27© 2018, GEP. All Rights Reserved. The Source-to-Pay Software Platform
Everything has to change. So…which way forward?
The most dangerous phrase in the language is:
"We've always done it that way“
Grace Hopper
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Workshop # 5
Paul Blake
GEP
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Procurement Transformation and the Digital
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