Procurement's Five Steps for Achieving True Digital Workplace Benefits
Introduction
Companies across industries are investing in digitalization to achieve one common goal: increased productivity. The search is on for connected software tools that can help to either produce the same output with less input or increase output with the same level of input. This digitalization trend is being fueled by widespread distribution of low-cost smart sensors that gather and forward data, increased connectivity, and new-generation data analysis tools and software.
Why such a push on productivity improvement? Recent data shows that business productivity is currently stuck in neutral. According to the US Department of Labor Bureau of Labor Statistics, labor productivity, during the current business cycle (which started in the fourth quarter of 2007), has grown at an annualized rate of only 1.1 percent. This growth rate is notably low compared with the rates of the 10 completed business cycles since 1947.1 Figure 1 illustrates some shorter trend data from the UK Office of National Statistics that seems to support the longer-term view.
Productivity numbers have reached this plateau because the technology in use today is imposing fundamental limits on how effectively workers can perform their jobs in the workplace. Most organizations have reached a productivity limit that will require a different fundamental set of work tools and new, more collaborative work approaches to achieve true digital workplace benefits.
Step 1: Pursue better data acquisition and data control
To achieve true digital workplace benefits, procurement must pursue better data acquisition and data control. This involves collecting data from various sources, such as sensors, IoT devices, and enterprise systems, and ensuring that the data is accurate, complete, and secure. By doing so, procurement can gain a better understanding of the business and make more informed decisions.
Step 2: Execute the conversion of data into business value
Once procurement has collected and controlled data, the next step is to convert it into business value. This involves analyzing the data to identify patterns, trends, and insights that can be used to improve processes, reduce costs, and increase revenue. By doing so, procurement can help the organization achieve its goals and objectives.
Step 3: Reinvent contract curation and facilitate contract compliance
Procurement must also reinvent contract curation and facilitate contract compliance. This involves streamlining the contract management process and ensuring that contracts are properly executed and managed. By doing so, procurement can reduce the risk of disputes, minimize legal costs, and improve the overall efficiency of the procurement process.
Step 4: Automate the invoicing