Taking stock of procurement priorities as 2018 begins

The procurement department and supply chain in general have had a tumultuous few years, with new technology allowing leaders in these fields to automate many of their traditional tasks and move into higher-level, more strategic work. The brief respite as 2017 turns into 2018 is a great time to take stock of how much has changed - and where the industry appears to be headed next. While the industry is somewhat unsettled now, a clearer picture is emerging.

What do supply pros care about?
In an end-of-year reflection, EBN Editor in Chief Hailey Lynne McKeefry explained that the expanding strategic role of the supply chain became visible in the media in 2017. Companies working on ambitious, new product launches have to ensure their procurement approaches are sound, with every detail worked out at the risk of losing business during key moments.

Of course, even supply chains that are solid when times are good can fall apart due to natural or manmade disasters. McKeefry therefore emphasized the importance of risk mitigation strategies. Extreme weather made its presence felt this year, serving as a constant reminder that unless a procurement strategy has enough redundancy to survive a fire, earthquake or other catastrophe, it is seriously flawed.

"Business leaders who want immediate value from improved solutions can launch pilot programs in the sourcing department."

Not only was tech adoption a major supply chain theme in 2017, but also McKeefry sees the use of new systems and concepts as an area where procurement can lead organizations. Business leaders who want to derive immediate value from improved solutions such as analytics or artificial intelligence can launch pilot programs in the sourcing department. Because the supply chain touches all other areas of business, efficiency and decision-making improvements affecting supply processes can positively impact organizations.

Basic considerations still ring true
While a number of new trends are giving procurement leaders directions to explore in 2018, many supply chain professionals are still aiming for easy-to-understand goals. According to Deloitte's latest research on chief procurement officers, cost advantages and cash flow improvements are still the bread and butter of the supply chain. Traditional efforts to improve contracts and advanced, tech-driven strategies can deliver favorable costs to companies.

Deloitte noted that procurement leaders can make use of the support they are likely receiving from corporate executives to further improve their own ability to contribute value. Better collaboration with suppliers, efforts to develop a new generation of procurement talent and the march toward better analytical systems are all possible areas for development and expansion in 2018.

As their role in decision-making increases and the tools available to them improve, procurement leaders have the potential to solidify their place as major members of any company's executive team. The year ahead may be a turning point in this ongoing engagement with overall corporate strategy as technology becomes more effective and ingrained roles shift.