For several years now, Spend Matters has been collecting and publishing a series of articles about predictions and insights on procurement, supply and services trends for the year ahead from expert tech and service providers in the market.
This year is no different as we’ve framed the subject around “insights,” highlighting providers’ observations from the year they’ve left behind and how they see these observations shaping the year ahead.
This series will run from mid-December to mid-January, then our analyst Bertrand Maltaverne will wrap up with his own take on the key themes that emerge.
In no order of preference, other than by the date they dropped into our digital letterbox, today let’s hear from Ali Cohen, Brand Manager at Archlet, a user-first sourcing software service.
Is procurement leaving sustainability behind in 2023?
The dialogue around sustainability has changed over the past decade. No longer do we ask ourselves whether or why we need to change, rather, we ask ourselves how we can engage in meaningful action.
While savings, operational efficiency and security of supply have been constant priorities for procurement over time, sustainability has grown in importance every year — 2022 being no exception. Supply constraints, consumer preferences and governmental regulations are all putting pressure on businesses to effectively manage their environmental impact. Procurement is uniquely well-positioned to help businesses achieve this objective and the world is taking notice. Procurement leaders have been confronted with the true environmental cost of supply chains and are being called on to move from making pledges to taking action.
Nevertheless, given the looming economic uncertainty, the question arises, will long-term sustainability agendas give way to short-term pressures? Will procurement continue to view sustainability as a strategic priority?
Sustainability is undergoing one of its most significant tests, but even with a recession being virtually inevitable in the coming year, our answer is that sustainability isn’t going anywhere. Today, business and procurement leaders largely agree that sustainability is integral to long-term business success. A thoughtful sustainable sourcing strategy can be a competitive advantage — helping businesses ensure resilience, attract and retain talent, and generate new sources of value. Moreover, governments are taking swift action to ensure companies no longer have the option of bypassing sustainability. For example, Germany’s Supply Chain Due Diligence Act, which will go into effect January 2023, holds large corporations accountable for responsible supply chain management.
“Even as economic uncertainty threatens resources, sustainability will continue to be a strategic priority for procurement. In fact, we believe it’s more critical than ever. Companies that prioritize sustainability during downturns often fare better than those that focus solely on cost optimization.” shares Tim Grunow, Co-Founder of Archlet.
No matter what the economic climate is like, embedding sustainability within procurement is not an easy task. The problem is that many procurement organizations don’t have the right strategy, skills and digital solutions to enable them to consistently consider sustainability when making decisions.
Using technology, like Archlet, strategic sourcing managers can evaluate and demonstrate competing strategic alternatives and their respective opportunity costs to their stakeholders. This allows the business to have fact-based discussions and enable transparent decision-making.
We believe a not-so-distant future exists where sustainability is a consideration in every sourcing decision. Getting there will take prioritization, commitment and the right technology.
Thanks to Archlet for being a part of the series and look out for more Spend Matters Insights for the year ahead over the coming weeks.
If you need to find the right procurement technology and provider for your business needs next year, Spend Matters “Procurement Technology Buyer’s Guide” TechMatch can help.
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And if you are looking for procurement services providers to help you with your 2023 decisions, look no further than our Procurement Services Market Landscape Directory.