The procurement landscape has dramatically changed in the last decade, with new technology, trends and extraneous variables all playing parts. This blog will focus on three emerging trends that are significantly impacting the procurement function and profession.
1) A renewed interest in developing local and ethical sources
A leading procurement trend is a renewed interest in the development of local and ethical sources. This has stemmed from a couple of different origins, the first of which being the global political landscape.
Talks involving Brexit, the United States position on international trade agreements, and uncertainty from overseas partners and suppliers over future trade agreements, have resulted in people changing their perspectives. There is a sentiment that the growth of home-grown supply may lead to a small reduction in international dependency, and therefore less exposure to exchange global instability.
The second origin of the local vs global trend, is consumer pressure and social media. Governments are signing up for an increased amount of environmental commitments, and consumers favour socially responsible brands. Consumers want to be able to trace the origin of their goods, and the impact producing them had on the environment. This creates pressure for transparency, and social media has transformed customer service and accountability indefinitely. Although this trend is even more true in Europe, it is being felt in North America.
Procurement needs to understand these changes and be ready to address them. Supply chain professionals will be under enormous pressure to ensure that their products are ethical, safe, environmentally friendly, and perhaps sourced locally.
With technological advancements (such as Cloud based services), increasing mobile empowerment, and increasing public scrutiny, this trend will be close to the top of most procurement department’s risk agendas.
As a result, procurement teams will invest in technologies that provide greater visibility into their suppliers. These technologies include blockchain, which has tremendous potential for not only enhancing supply chain transparency, but eliminating cybersecurity threats as well.
HCMWorks’ MSP programs support these trends by ensuringsuppliers are both transparent and compliant and risks are being identified and mitigated. If you have any questions about how these trends will impact your Vendor Management practices, let us know and we’d be pleased to discuss it with you.
2) Procurement Will Gain More Influence By Providing More Information
Procurement needs to progress towards empowering business with analytics, that allow local and calculated decisions.
Procurement professionals are privy to a copious amount of business critical information, and with this knowledge, procurement teams will begin to harness information to advance both their careers and their organizations. This trend comes hand-in-hand with the rise of information management. Supply chain professionals will go from managing products and services, to managing insight itself - becoming a central hub of information for business.
This trend will lead to two outcomes, the first being a more critical function for procurement in organizations. As a result, supply chain professionals will play an even more vital and central role in their organization’s success.
The second outcome is the leveraging of online marketplaces, as online platforms continuing to grow in popularity. Access to these marketplaces will lead to greater efficiencies, identifying hidden cost savings across wider business areas, and the potential reduction of geographical limitations in favour of access to global pools. As online platforms grow, they will streamline purchasing capabilities, helping get faster access to high quality suppliers while also ensuring in-house compliance.
HCMWorks uses Vendor Management System(s) (VMS) to support our clients. A VMS is a web-based software that can manage and procure contingent workforce talent via staffing agencies. It makes calculated decisions based on your business’ culture, goals and needs, when making suggestions and recommendations. If you are looking for a Vendor Management solution we’d like to help you explore the best option for your organization.