Technology isn’t always a silver bullet

3 minute read, posted on 05/13/2019, by James Jarrett


Again and again, I’m hearing this same thing from procurement professionals about the state of RFP processes today. As one client succinctly outlined their frustration:

“It’s madness. We do this same thing year on year, spending hours running the RFP vendor selection process – expecting a different outcome. It’s like Einstein’s definition of insanity – doing the same thing repeatedly, yet expecting different results.”

We all want to drive more value – but tweaking the edges of an antiquated system won’t drive positive change. Having worked in operations, client services, and sales for many years, here’s what I’ve seen forward thinking procurement professionals doing.

While the RFP process remains stagnant – everything else is changing. The RFP templates that were once the saviors of productivity have ironically driven out the magic just when organizations need it the most. Everyone says they’re looking for new ways of adding value, bottom up innovation and vendor-led insight, but in reality the standardized RFP process today is suffocating any morsel of innovation looking to present itself as valuable opportunity.

Here’s the really worrying part. Just 5% of procurement professionals agree that they already have “highly automated” technology processes – despite 63% of procurement leaders identifying digitization as a high priority – signaling that change is inevitable. McKinsey is also predicting that over half of today’s work activities could be automated by 2055. So what happens as AI technology and cognitive procurement continue to automate the most mundane and repetitive processes? What happens when the procurement team itself becomes the cost savings, as the business realizes that this repetitive process indeed, is madness?

I believe that procurement is one of the most valuable departments in organizations today. Yet I think the time is coming where savvy procurement teams need to step up, and look to broaden their definition of value beyond that of cost, or they risk being swallowed by the rapid change engulfing the industry. It’s a shocking fact that 51% of CPO’s believe that their current teams’ capabilities are not sufficient to deliver their procurement and business strategy.

As a senior executive for the last two decades – Here’s my two cents as to what you should be considering in RFPs going forward:

  • Consider the impact of cultural fit – you’re not just hiring a supplier, but more or less an extension of your firm. Highly strategic supplier relationships often have significant co-dependency and can mean the difference between success and failure of key business initiatives.
  • Ensure you seek out vendors that approach things differently from your current network – creating an injection of fresh ideas and better ways of working
  • Verify the measurement of value focuses on more than just cost and innovation.

We need to be doing this differently. If we do the same things we’ve always done, we’ll get the same results we always have.

The time bomb is ticking. And with the customer care space in a rapid resurgence of change, procurement professionals are in the perfect place to be agile, adapt, and deliver sustainable value to their organizations in the future. Please join me in a conversation to talk about ways to drive change in your organization.

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