Risks in the Supply Chain are Causing Purchasing Departments to Rethink Excel
Purchasing Departments are accelerating Digital Transformation efforts in 2022 to mitigate geographic, economic, part shortages, and supplier risks in the supply chain. Digital Transformation in purchasing has become a hot topic, however in 2022 there’s a new twist: Purchasing Departments are not seeking quantum transformational leaps, rather they are opting for a rapid evolution of their Digital Transformation. Why?
Driver 1: Purchasing Departments are Overwhelmed
Covid-19 related supply chain challenges have resulted in unprecedented amounts of work for the purchasing team. A buyer’s day is filled with chasing parts, managing supplier price increases, responding to sales, and other transactional activities that provides limited value to the organization. As a result, purchasing spends most of their day managing critical issues while losing sight of strategic initiatives like cost savings.
Driver 2: All Encompassing Supply Chain Solutions Do Not Deliver Immediate ROI
All-encompassing supply chain solutions are powerful, but the amount of work necessary to properly implement the tool across an organization takes time and money – both enemies to delivering a reasonable payback to the company in a timely manner. It may take as long as 12-18 months for the company to truly see value from the implementation.
Driver 3: Scope Creep
Activities of the Purchasing Department effect every other department in the company. So, when it comes time to implementing a supply chain system, other departments get involved with specific wants and needs that complicate the matter. The system becomes too complex and expensive which results in a delay and in many cases, companies choose not to move forward.
Companies need immediate relief for critical supply chain issues now. Most of these issues are time consuming and transactional in nature but can be resolved by deploying targeted technology to solve a specific issue. This a step-by-step approach delivers incremental value to the organization and builds the foundation for an all-encompassing Digital Transformation in purchasing – one that can be evolved over time.
To learn more, please feel free to setup a meetings with an APD Executive by clicking here: Meeting with Mike Betz.