Procurement Technology, Procurement Strategy, and a Path to the Future
At the end of September, Arkestro hosted a webinar covering the topic of predictive procurement. The focus was on how procurement technology and procurement strategy align with the digital transformation goals of many procurement teams; reducing manual work to free up time for delivering on strategic objectives around value creation and cost reduction.
You can view the entire webinar here if you’re interested in learning more. If you’re short on time or want to see the discussion distilled into its key points, read on…
Procurement Strategy and Our Expert Guests
This webinar included the involvement of two guests in addition to Arkestro’s CEO and Founder Edmund Zagorin. Duncan Jones is a Vice President and Principal Analyst with leading global market research and consulting company Forrester. His expertise includes over 15 years of maximizing the value from strategic software partners for sourcing and vendor management professionals. Mathieu Pappalardo is the Vice President of global sourcing and procurement at multinational food production company Materne Industries (best known in the U.S. market for its GoGo squeeZ brand). In addition to his professional background, Mathieu has first-hand experience in implementing Arkestro.
Between the three of them, there was an incredible amount of procurement experience and tech industry know-how participating in this webinar.
Concerns of the Procurement Team of the Future
The future of procurement is becoming clearer than ever. Big events like the global pandemic and its impact on product demand and the supply chain, the shift to environmentally-friendly government policies, and societal change are profoundly impacting procurement and procurement strategy. The demand is being driven at all levels of the organization, as well as by customers.
Forrester’s Duncan Jones sums up the challenges facing the industry:
“… they’re looking for innovation in the products and services that you deliver, that you get from your supplier ecosystem. They want reliable, sustainable ethical suppliers. And that matters to them in the brands that they pick. They want you as procurement professionals to empower employees so that they can buy the stuff that they need quickly and safely. And they need business agility, so when stuff happens in the wider market when there are supply interruptions and so on, that you can react quickly to those and continue to supply them with the products and services they need. And of course, we need to do all of that without forgetting the basic part of the job, which is ensuring value for money in everything that we buy. So how do we do that? Well, we need good software to do that because we’ve got all these conflicting priorities.”
Too Many Data Sources to Process Manually
Modern procurement teams are required to process data from a wide range of sources. And the sheer amount of data that’s captured today is mind-boggling. That vast collection of data is a significant advantage if you can take advantage of it, but it’s increasingly overwhelming for those who have not embraced technology.
As Duncan Jones puts it:
“We search through it. We drill down, and we double-click, and we double-click, and hopefully, after several hours we find something interesting.”
The days of analyzing the data in a single spreadsheet and double-clicking are long behind us. Today’s sourcing professionals frequently find themselves in the position of processing data from multiple internal systems. In addition, they must process data being generated from external sources, such as suppliers and social media. To make smart, strategic business decisions, massive amounts of data generated by different systems must be analyzed. It must also be done quickly.
It’s impossible to do this manually. That’s where technology comes in.
Modern Smart Software Delivers Three Types of Insight
At a high level, modern procurement software is delivering three types of insights that are simply not available when using manual processes or outdated solutions.
- Automation: entry-level tasks such as extracting data from invoices, plus automation of semi-skilled tasks that free up procurement professionals for more strategic priorities.
- Automated alerts: where the software is trained to know what the procurement team is looking for (such as a supplier that is a risk for not delivering on time or duplicate invoices) and highlights the issue for the team to take action.
- Future level learning: where the AI driving procurement software is so advanced after learning from experts that it can eventually outperform sourcing professionals.
Arkestro Delivers the Technology to Support Predictive Procurement
Arkestro CEO Edmund Zagorin makes the point that Arkestro is at the intersection of the technology landscape and the needs of procurement leaders. It’s innovation that is available now, not at some point in the future.
“Arkestro predictive analytics is driven by artificial intelligence and helps leading procurement teams win faster savings, primarily using an AI technology called anomaly detection. Anomaly detection is an automated way of saying does this price look right given similar prices that you might expect to have seen for a specific item.”
Designed to leverage the power of AI, machine learning, and data science, Arkestro delivers on the promise of predictive procurement—now.
Materne Proves the Value of Arkestro
Materne Industries implemented Arkestro for its procurement team a year ago. The company has been dealing with the same issues that so many others have recently, including inflation, sustainability, and supply shortages. At the same time, the procurement organization continues to face pressure to deliver savings.
Mathieu Pappalardo reports that adopting Arkestro allowed his company to achieve its sourcing priorities while reducing the time required for the bidding cycle. Suppliers were cut down to a strategic group. And the company saved money across not just the big spend categories, but also smaller categories that were only made practical through the use of Arkestro.
“We did bids on categories that we touched before and we got better results, but also on categories that we actually never touched because it was too small, or we thought it was too small, or the data was too scattered and we didn’t know how to put that in the same system.”
Take the Next Step and Book a Demo
After reading about the critical importance of automation to deal with an increasingly complex supply chain and the ability of Arkestro to deliver on predictive procurement, now is the time to see this user-friendly, AI-powered software in action for yourself. Book a free demo to experience the Arkestro advantage and see how companies like Materne Industries are adopting Arkestro to drive faster savings.