Top 10 procurement trends that you need to know about in 2024

In today’s fast-paced business environment, staying ahead of the latest trends in procurement is essential for success. Global pressures on Supply Chain make it more important than ever to stay ahead of the procurement trends and adopt them quickly within your business.

Procurement is the hub of your business and is the area best positioned to build agility within your organization and resilience throughout, through effective inventory management techniques and robust cost management.

Here is a collection of ten key emerging trends within procurement.

1- AUTOMATION AND ARTIFICIAL INTELLIGENCE

Machine Learning and Robotic Process Automation (RPA) are two ways that automation is impacting procurement. Machine learning will learn from past behavior and automate certain tasks, like inventory management and spend analytics.

RPA is a form of automation where human behavior is learned and repeated allowing for manual tasks to be taken over by a machine. Examples here may be the automation of invoice processing as an example.

2- BLOCKCHAIN

The use of blockchain in procurement means all users throughout the supply chain will have visibility to the entire process, as well as a high degree of security throughout the process. Chain of custody and batch tracking are two applications within the blockchain that are especially important to procurement.

Building trust throughout the entire supply chain speaks to the emerging importance of the Blockchain and its importance to procurement.

3- CLOUD-BASED SOLUTIONS

The cloud offers many benefits for procurement, such as flexibility, scalability, and cost savings. Additionally, cloud-based procurement platforms offer a number of advantages over on-premise solutions, including scalability and easier integration.

Effective disaster-recovery protocols are another essential component to the move toward managing through a cloud solution.

4- COMPLIANCE

With increasing regulations and compliance requirements, the need for robust compliance capabilities within procurement is essential. Procurement Compliance allows companies to control spending and stick to a set of procurement standards within an approved framework. Compliance is an important part of an organization’s risk management strategy.

Shifting regulatory requirements throughout the supply chain means that business has to adapt to agile procurement policies and practices.

5- DIGITAL TOOLS

Digital tools are revolutionizing the way that organizations manage their supply chains, with innovations like automated sourcing platforms and predictive analytics improving efficiency and effectiveness across the value chain. Moving away from manual processes, to digital ones, allows teams to effectively manage procurement.

Within the procurement digital toolkit, there are tools to effectively manage supplier relationships, contract lifecycle, inventory levels, and cost management.

6- RISK MANAGEMENT

With today’s globalized supply chains, managing risk is more important than ever before. According to Atul Vashistha, the chairman of Supply Wisdom, organizations need to prioritize risk management as a fundamental way to stay resilient.

An investment in risk professionals will reap benefits within procurement as these individuals continue to monitor the process for risk throughout the supply chain.

7- INNOVATION

Innovation has become an important aspect of procurement, with organizations partnering with suppliers to develop new technologies and products that can improve their bottom line.  

In the past, procurement has been focused on traditional means of managing the business. Recently, with trends moving so quickly, our Supply Chain has adapted quickly and will continue to capitalize on the fast pace of innovation within this space.

8- COLLABORATIVE PLATFORMS

Collaborative platforms such as e-sourcing and reverse auctions are enabling organizations to find more efficient, cost-effective ways to source goods and services. Collaboration platforms within your organization and the tools you will have in place will govern how your procurement can be modernized.

Quick and easy internal communication, coupled with robust supplier communication is key to effective procurement practices. Collaboration tools allow you to partner with your suppliers and internal stakeholders alike to quickly execute robust negotiations, effective fulfillment, and comprehensive spend management & analysis.

9- INCREASED FOCUS ON SUSTAINABILITY

Organizations are increasingly focusing on sustainability, with procurement playing a key role in sourcing sustainable products and services. With the increased focus on Environmental, Social, and Governance (ESG) practices, by investors, it has become more important than ever for organizations to adopt sustainable procurement practices. Our procurement teams are an essential part of the value propositions from an investor perspective, as they build value for the entire organization.

10- AGILE SUPPLIER MANAGEMENT

With the ever-changing nature of business, it is important for organizations to have an agile approach to supplier management. This includes having a clear understanding of supplier capabilities and being able to quickly adapt to changes in the market.

While the concept of agile originates from software development, the concept applies to procurement, according to Forbes. The agile framework encourages projects that are more aligned with the consumer’s needs. Decisions made throughout the supply chain are structured with the customer in-mind. An alignment with suppliers who share this belief is crucial.

CONCLUSION

In order to stay ahead of the curve in today’s business environment, it is important to be aware of the latest trends in procurement. The ten procurement trends that we have outlined are a good place to start, as they represent some of the most important changes currently taking place within this field.  It is essential for organizations to embrace these e-procurement trends and adopt them quickly within their business in order to gain a competitive edge in today’s dynamic marketplace.  Whether you are looking to streamline your procurement process, better manage risk, or incorporate more sustainable practices, there is a trend here that can help you do just that.

Fast paced changes within procurement are here to stay and it will become more important than ever to keep ahead of the trends.

‍