Homework not done

In its survey ,,Trendgeflüster 2016/17", Onventis, with the support of the German Association of Materials Management, Purchasing and Logistics (BME), asked 240 companies about their strategic planning and investments in purchasing and procurement.

As the survey results clearly show, there are still a number of question marks regarding digitalization in purchasing and procurement.

sums up Onventis CEO Frank Schmidt.

Overall, 98 percent say that digitization is an important issue for them, but the willingness to invest is by no means evidence of this high priority in all areas.

If 99 percent of procurers consider supplier networking to be relatively important, but 38 percent have not yet budgeted for it at all, there is a huge gap.

Accordingly, the reaction time in purchasing is often anything but agile, which is particularly evident in the case of market changes. More than half (52%) can only react to changes in the company within weeks and only 26 percent within a few days.

Essentially, the slow response times are caused by inadequate digital process support.

If the supply chain is not supported digitally from end to end, this will have an impact on all areas.

knows the Onventis CEO.

In the future, no procurement will be able to get by without integrated supplier collaboration.

What is saved today on the budget for networking will be reflected tomorrow in the procurement costs".

predicts Frank Schmidt. At the end of the day, you pay more for your purchases.

Spend Analysis

The situation is hardly any different for the other electronically supported procurement processes. For many, Spend Analysis is still a blank slate:

Although 83 percent of respondents consider the topic important, just under half (49 percent) do not yet have a sufficient budget for it.

As a result, companies miss out on the opportunity to use intelligent supplier analyses to identify potential and risks in a targeted manner.

Supplier relationship management (SRM) is also important to very important to a large proportion (85 percent) of the survey participants, yet 20 percent still do not invest at all or only insufficiently in SRM.

In recent years, a lot has been done for relationship management, but mainly with a focus on the customer, i.e. CRM and sales support - the supplier relationship was sometimes neglected.

Anyone who maintains a supplier relationship based on partnership considers his suppliers to be just as important as his customers".

emphasizes the Onventis CEO.

The situation is almost identical for sourcing and contract management. Both areas are considered important to very important by 85 percent of the 240 companies surveyed, but here too the willingness to invest is limited:

For sourcing, 42 percent of procurers have only a partial budget or no budget at all, and for contract management, more than half (55 percent) do not have sufficient funds at hand.

There is still a lot of catching up to do in the digitization of purchasing.

is the conclusion drawn by Frank Schmidt.

Only those who have a precise knowledge of their suppliers and purchasing processes can reduce risks, identify bottlenecks at an early stage, and take targeted countermeasures if necessary."