Find answers, ask experts and talk with the procurement community
Do you want to deliver savings faster, reduce risks and transform functional performance?
Inspirational thinkers and innovators share their vision, providing unique opportunities to network and share best practice
Procurement technology has the potential to radically transform your procurement organisation. But technology availability and technology adoption are not the same thing. You may covet – or even own – the most sophisticated, space-age pair of running shoes on the market. But if you never put them on, lace them up, and get moving, they won’t help you get in shape. CPOs may want their teams to be less mired in administrative tasks, more invested in strategic collaboration with suppliers, and more in tune with the needs of the lines of business. Having the right technology won’t help them do any of those things. They have to use it, which is not as simple as it sounds.
Before you think about undergoing a procurement transformation, be prepared to tackle the enemies of technology adoption.
Enemy #1: Fear
Fear makes it difficult to adopt new procurement technology. Fear of enterprise software. Fear of having to re-train people. Fear of making a purchasing decision, only to find that nobody uses or likes the new solution.
To combat these fears, understand that the payoffs of greater technology adoption are tangible. Edward Cone of Oxford Economics, referring to Oxford’s research on the future of procurement, writes: “Our surveys indicate that technology adoption is linked to superior financial performance. Companies with higher rates of growth and fatter profit margins tend to be more aggressive in their use of technology. [Procurement] execs at high-profit firms are more likely to emphasise the importance of business networks, Internet of Things, and mobile.”
Plus, enterprise software no longer has to be complex. We live and operate in a Software-as-a-Service (SaaS) world, in which enterprise technology gets easier to use with every new release and the release cycle is frequent. At SAP Ariba, where I’m the chief design officer, we talk about a total user experience that’s “consumer-simple, business-strong”.
Even if you’re just beginning to consider adopting new technology, don’t limit the decision-making process to a select few stakeholders. Modern source-to-pay solutions will benefit colleagues far beyond your department, so invite those stakeholders to the table from the beginning: finance, IT, end users from the lines of business, key suppliers. Solutions such as SAP Ariba are meant to eliminate fragmented processes, so don’t fragment the evaluation process. Let users test it and tell you whether they like it, so you can get validation and buy-in from your organisation up front and make a purchase decision with confidence.
Enemy #2: Control
Inflexibility can hamper technology adoption. Until recently, control over software decisions and usage traditionally belonged to a handful of the highest-ranking people in the company. As software becomes easier to use, more people have access to it and more people can use it, which organically shifts the pendulum of control from the few to the many. The enemy here isn’t so much loss of control, as it is holding on too tightly to control.
To combat inflexibility, procurement organisations can realise that technology adoption gives procurement the opportunity to not just retain control, but to gain greater control while giving users a sense of knowledge and freedom. Consider this: technology can make your policies easier to learn, follow, rethink, and re-invent. With the demographic changes of the workforce, Millennials are your users. And younger generations that grew up with technology have much less tolerance for complicated products and learning curves. You’ll be more successful if they want to use your software than if you force it on them. When people enjoy doing something, they learn how to do it naturally.
And all that goes along with getting users to follow policy. CPOs are recognising that they mustn’t be seen as gatekeepers and controllers in order to get people to go along with their policies. They have to make their policies very doable and attainable. Making solutions intuitive, with no training required, encourages users to do things the right way – your way.
Asad Zaidi, director of procurement and performance improvement at the Al-Futtaim Automotive Group comments, “SAP Ariba solutions offer flexibility and ease of use while still supporting robust policies. We were able to emphasise transparency and fairness, which is very much appreciated by our vendors.”
At the same time, perhaps your approach to rules and regulations needs to be reinvented. You’re not going to send users to read a 20-page document. The key is to set up your procurement system with the policies built-in, your catalogues with category-based approval thresholds, and your sourcing event workflow so that no steps are skipped. With your internal rules built into your system, your end users can get their jobs done, and the procurement and finance people can have the oversight and control they need.
Enemy #3: Complexity
A complex user experience can sabotage technology adoption. User experience (UX) encompasses every touchpoint that a person has with your procurement organisation. Your training materials, your policies, your people, and your software are all touchpoints. You can address many of the fear and control issues discussed here by modernising your technology users’ experience. Even so, complexity can still be a problem if you, as the technology decision-maker, don’t think about your software from the user’s perspective.
When users are faced with complex technology, they bypass the system to accomplish their goal, then figure out a workaround to get their data back into the system. They spend more time on tasks without ever knowing if they were successful in completing them. And they may even feel inept. When offered a simple, friendly and delightful user experience, employees enjoy the benefits of saving time and achieving their goals. They feel smart, encouraged, and eager to engage with the software.
Here’s a deeper dive into how to recognise simplicity in procurement software when you see it.
Mobile-first, global-first mindset: Let users work everywhere, on any device. Don’t expect a user that’s primarily in the field to use a laptop. Think about the various roles of your users, the tasks they need to accomplish, and the places they may be when they need to get their job done.
Intuitive workflow processes: Don’t make your users wonder if their work is being saved, if your system will time them out, or if they’ve failed or succeeded. Make sure your workflow steps are designed and labeled with the user – not the backend system – in mind.
Personalised for the individual user: A category manager has different needs than an occasional user from marketing. User experience is role-specific, so your software provider must understand each user, know their goals, and provide an experience that’s customised and intuitive for them.
Validation and feedback: Users of corporate technology want to know what’s in it for them – how the technology makes their life easier. They want to see evidence of their successes early on in their process, and they want to feel that the technology has helped them achieve their goals – not hindered them. Zaidi comments, “Change management was essential. It’s key that both internal employees and external suppliers understand the benefits of a closed-loop value chain. They need to know what’s in it for them.”
Flexible, guided buying: With an ecommerce site like Amazon, you know exactly what to do at the very beginning of the buying process, and you feel confident in your ability to complete your purchase. Business buying must be consumer-simple. Look for software features such as guided buying and off-catalogue purchasing, which give the end users freedom and independence while allowing procurement excellent control over processes and vendor management.
Community learning: Sourcing and procurement technology can provide frictionless access to community-based insights, where users learn from each other within the same platform they already use. Instead of going off-line, your users can stay focused and on task while tapping into the expertise of others in their industry or role around the world. Plus, the sense of camaraderie they get by learning from their community sure beats looking things up in manuals and training materials.
Drive technology adoption by driving simplicity. With more users on a single, simple source-to-pay system, the procurement organisation at large reaps the benefits of streamlined end-to-end processes, better data and visibility, and greater control. If we make procurement systems and policies easier to use, then not just the CPO but all the end users will adopt them more readily.
This article has been commissioned by Procurement Leaders. It is part of a sponsored editorial product, published in partnership with SAP Ariba. Commissioned by Procurement Leaders.