Procurement Is Going Digital, But Not Overnight

Mark Brohan

While many companies are accelerating e-procurement, businesses are still dealing with such roadblocks as limited technology budgets and lack of expertise in data management.

Web procurement remains a top priority for many manufacturers, but there remain roadblocks to how quickly companies are rolling out more e-procurement initiatives. Those are two of the main conclusions from a forthcoming report from procurement services provider SAP Ariba.

The survey, which includes responses from 466 procurement and logistics managers from diverse industries, including automotive, financial services, discrete manufacturing, consumer products and retail, chemicals, and life sciences, finds that 83.9% of chief procurement officers consider the implementation of digital technologies such as artificial intelligence and others as “important to improve procurement performance.”

Shifting to automated purchasing

Nearly two-thirds of chief procurement officers are leveraging cloud computing to accelerate e-procurement, and more than three-fourths of respondents—78%—see their use of digital procurement technology, or their level of “maturity,” as similar or better than that of their competitors.

Digital technology is changing how manufacturers at all levels are doing business as supply chain management and the purchasing cycle become even more automated and transparent, says SAP Ariba chief digital officer Marcell Vollmer. That trend is reflected in the survey findings: “82% of participants believe digital transformation will affect procurement more in 2019 than 2018,” Vollmer says.

Digital roadblocks

Despite the fact that more chief procurement officers do see the rollout of more digital procurement applications as a priority, there are still barriers to overcome, according to the SAP Ariba survey.

The main roadblocks include:

  • Budget restrictions (46%)
  • Analytics and data insights (43%)
  • Internal talent shortage and lack of “know how” (43%)
  • Master data management (40%)

“Chief procurement officers are seeing a sense of urgency to go more digital,” Vollmer says. “But to make that happen, companies will need to free up more resources.”

Vollmer will deliver more detailed findings from SAP Ariba’s annual survey of chief procurement officers on April 2 at SAP Ariba’s annual event in Austin, Texas

This article originally appeared on B2B E-Commerce World and is republished by permission. Follow Mark Brohan on Twitter @markbrohan.

Mark Brohan

About Mark Brohan

Mark Brohan is editor and publisher at and director of B2B e-commerce research. Follow Mark on Twitter @markbrohan.