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 Helio Alcantara of IBM, procurement consulting and outsourcing services.
Balancing the digital buyers and sellers ecosystem
For many years, one of the biggest challenges for procurement organizations has been managing tail and tactical spend in an effective way. Most organizations dedicate a higher-than-optimal number of resources that generate minimal savings, expose themselves to higher risks and provide a less than acceptable user experience. These smaller purchases generate numerous transactions with low value. Over the last few decades, the only disruption in that space was the adoption of catalogs, but they still require attention to set up and register suppliers as well as regular maintenance — an effort that is multiplied by the number of organizations that have their own isolated catalogs.
To address this in recent years, a newer trend that has hit the market is utilizing a digital marketplace network where multiple buyers and sellers transact within a shared infrastructure. But, as in any shared environment, strong governance is required to manage the ecosystem, to set up and maintain the content and all of the available options, and to curate the transactions. There are excellent options available and constantly evolving to support buying organizations’ procurement and finance controls. Their focus is on matching buyers’ needs with sellers’ offers, vetting sellers following rules, regulations and strategic directions to be adhered to by buyers, providing options for which categories and sellers can be accessed by users and applying exponential technologies to guide decisions.
What we can expect to see in 2023 is an emergence of buyer and seller ecosystems that enable both seller content management and buyer business controls. This type of solution would reduce the amount of resources required for managing tail and tactical spend while enabling additional savings through real-time competitive pricing in the ecosystem, and a superior user experience. The technologies currently available, combined with experienced procurement service providers and transaction handling operators already allow for the possibility of tail and tactical spend ecosystems that are compliant with procurement requirements.
Thanks to IBM 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” and TechMatch can help.
For granular analysis and comparisons of procurement technology solutions, subscribe to Spend Matters PRO.
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.