How Your Procurement Team Compares with Peers in 2021
800+ procurement pros say outdated processes hinder business
In the last year, procurement teams have had to address a lot of changes. As a link between internal lines of business and external vendors, procurement is critical to the way organizations maintain continuity through disruption. The new demands placed on procurement teams were both a test of their agility and proof of their importance to a business.
To take a pulse of the modern procurement landscape, DocuSign surveyed more than 800 professionals from around the globe, studying their top priorities, the way they work, and the changes they made in the past year. The study even explores key differences between businesses that were prepared for the challenges of 2020 and those that were unprepared. The comprehensive survey results can be found in the free Global Procurement Trends and Priorities report.
Here’s a short overview of the key findings.
Controlling cost above everything else
By a clear margin, cost savings—identified by 47% of respondents as a critical team goal—stood out as the most important procurement priority. Looking five years into the future, cost savings is predicted to still be the top priority, by an even wider gap.
However, 2020 ushered in a new range of unexpected disruptions to make cost reduction difficult: supply chains were disrupted, delivery logistics grew far more complex, regulations changed and remote work prevailed. These new challenges made it extremely important for procurement teams to examine their contracts and clarify relationships with external parties.
The teams that succeeded in that task shared a common trait: flexible contracting workflows that opened the door for fast adaptation. Teams that stuck to outdated manual contracting processes were far more likely to see increased costs and contracting bottlenecks in the new work environment.
Collaboration with other teams is challenging
Ideally, procurement teams work effectively with other departments to identify purchases that move the business forward. Unfortunately, these internal partnerships are often troublesome. Respondents describe contract collaboration as “challenging” with almost every internal team. There’s a long list of reasons why that work is challenging, but burdensome manual contract work is at the heart of the problem. In particular, there are issues collecting signatures and analyzing language on incoming contracts.
For procurement teams to increase their organizational value, it’s important to develop smooth contracting processes for efficient internal partnerships. The teams that simplify this work run into fewer barriers and delays when working with other teams and positioning themselves as cross-functional leaders rather than simply tactical executors.
Technology helps adapt to remote work
As COVID-19 impacted workflows across all lines of business, procurement had to adapt quickly to continue working with both internal colleagues and external suppliers. These teams had to successfully manage the move to remote work while also navigating the complications of global supply chain disruption.
Once procurement teams made necessary immediate reactions, they doubled down on existing priorities: maintain business continuity and control costs. The most common action taken in response to the pandemic is investment in technology; also common is to change supplier strategies and workflows.
Success was a race to adopt new technology. The biggest differentiator between procurement teams that were able to successfully navigate the pandemic and those that weren’t was investment in modern technology. The winners had forward-looking leadership and robust support for remote workers. The organizations that were unprepared cited insufficient technology, manual processes and slow-moving leadership as common points of failure.
A well-integrated technology stack is critical
Today’s procurement teams have taken the initial steps to modernize their contract workflows, but aren’t seeing a significant return on that investment yet. Only 1 in 20 procurement professionals thinks they’re taking advantage of the full technological capabilities of their procurement tooling.
There are a range of issues that contribute to this unfulfilled potential, but the most significant problem is a stack of point solutions that manage individual agreement processes, but do not integrate with each other. As forward-looking procurement teams develop a blueprint for the future, it’s imperative to consider the end-to-end agreement workflow and build a process full of tools that are intended to work together.
The most important solutions to include in that stack are most frequently: procurement management, electronic signature and contract lifecycle management. Looking five years into the future, the same tools are projected to be critical. Teams looking to invest in technology to digitize procurement contracts should look for a suite of agreement tools that includes integrations at each important step in the process.
The best way for modern procurement teams to control costs, increase contracting efficiency and improve the experience for all collaborators is to choose an automated end-to-end solution.