10. Make vs. buy
“With the emergence of new technologies, such as 3D printers, and the need to drive competitive advantage, the current status quo around make vs. buy will be challenged,” commented EY.
The firm stated that organisations will need to understand the tradeoffs when it comes to reducing producing downtime and costs, snd improving sustainable practices by making products vs. buying
“There will be some hesitation on implementing private blockchain networks due to the costs of development and deployment. Blockchain use will most likely be limited to scenarios where there is a regulatory track-and-trace requirement, high levels of counterfeiting or a clear business case for operational integrity.”
8. Voice-activated and bot-purchasing experiences
EY predicts that 2021 will see voice-activated and bot-purchasing experiences become the norm.
Future buyers will have access to “seamless and intuitive purchasing experiences, regardless of underlying technology systems already in place. What could this look like? Think voice-activated purchasing experiences for goods and services, supported by natural-language search and virtual assistants,” stated .
7. Commercial off-the-shelf solution providers
EY predicts that 2021 will be the year that commercial off-the-shelf solution providers open up their architecture allowing third parties to develop and sell apps and software.
“The mobile phone app store experience will be available to the business world with COTS providers, allowing access to third-party apps and software. We are already starting to see this happen, but this trend will become more widespread,” highlighted .
6. Robotic process automation
Robotic process automation (RPA) – EY sees this technology becoming an integral part of anyany commercial off-the-shelf (COTS) solution deployment to reduce the impact of ongoing wholesale software upgrades.
“By 2020, leading procurement functions will have fully enabled end-to-end procurement, where manual intervention for high-volume repeatable tasks is removed (e.g., purchase requisition to purchase order conversion and invoice processing). Manual reporting will be a thing of the past, and employees will get the opportunity to focus on business-critical work instead of shuffling paperwork,” noted .
5. Organisations will leverage internal and external data sources
To better assess supplier risks, EY predicts that organisations will leverage internal and external data sources to provide a 360 view of suppliers.
“This will not only provide historical data about supplier performance but will also enable organizations to accurately and holistically establish supplier risk profiles and to predict risk events,” stated .
4. Integrated data ecosystems
EY expects 2021 to bring integrated data ecosystems that enhance visibility of patterns across the organisation.
“The data captured from the Internet of Things (IoT) will enable real-time tracking and monitoring of outcomes through continuous feedback loops across assets. Asset-intensive industries will effectively link this data across the enterprise and connect to suppliers, enabling touchless procurement in the next 24 months,” said .
3. Machines will clean and curate their own data
EY predicts that the future will bring data that is continuously cleansed and improved by machine learning, leveraging process outcomes to automatically identify and remedy data anomalies within systems.
“For example, the vendor master will be continually maintained using data from contracts as well as those used in pay runs. Similarly, maintenance work orders, which drive purchase orders, will be informed by the actual usage of materials in completed jobs. This will create a ‘virtual cycle of digital’, where data will continually improve, and organizations will mostly use machines for periodic data cleansing,” commented .
2. Smaller, more agile functions partnering directly with business units
As we look to 2021, EY expects to see procurement become much smaller and increasingly agile functions that partner directly with business units.
“Procurement will be a smaller, centralised function, with more happening in a virtual center and with people geographically embedded within business units, meeting the need for increased collaboration,” commented .
Who also highlights that category managers will become business partners “focusing on all procurement and category needs of a business unit. Specialist knowledge and expertise will be obtained by leveraging the “gig economy” on an as-needed basis,” added .
1. Procurement’s contribution to the overall organisation strategy
First up on EY’s trend list is – procurement’s contribution to the overall organisation strategy. The consultant firm expects this to be a key driver for competitive advantage.
“Leading procurement functions will become part of an organisation’s value stream and will be more influential in contributing to the overall business strategy, growth agenda and competitive advantage. Procurement leaders will be expanding their remit from a focus on cost leadership to enabling innovation, agility and supply certainty,” commented .