New Workday Study Finds Organizations Upgrading Sourcing, Supplier Management

Workday and Harvard Business Review partner for a study that highlights the scope of procurement’s role in strengthening enterprise resilience and outlining the best practices and organizational standards necessary for success in "the next normal."

8ed89770 Aa93 4131 93d1 089bd913a5e7
momius

Workday, Inc. announced results from a global study done in partnership with Harvard Business Review Analytic Services, which found that 60 percent of organizations say the pandemic has fast-tracked plans to upgrade and automate sourcing and supplier management. The momentum to advance digital acceleration comes as 95 percent of surveyed executives report disruption to their company’s sourcing and supplier management process as a result of the pandemic and 92 percent classified the digital maturity of this process as less than best-in-class going into the global crisis.

The report, titled “Managing Procurement Risk: Enterprise Agility for a Changing World,” highlights the scope of procurement’s role in strengthening enterprise resilience and outlining the best practices and organizational standards necessary for business success in ‘the next normal.’ The survey of nearly 200 global business executives found that when it comes to procurement and supplier management processes, accelerating automation of procurement processes, digitizing more supplier information, and expanding data analysis capabilities of the supplier base are among the top initiatives companies will aim to support in the next 12 months. Additionally, the report reflects increased confidence in cloud platforms as the future of procurement technology, with 93 percent of respondents saying they already use such platforms, plan to use them, or are not yet but believe they should be using them.

Comments on the News

“Now more than ever, companies need a sophisticated, tech-enabled strategic sourcing function - highlighting the foundational importance of procurement in helping to enable critical cost-savings, mitigating supply chain disruptions, adapting business models, and achieving enterprise resilience,” said Alex Yakubovich, general manager, Spend Management, Workday. “Workday Strategic Sourcing has helped customers weather the pandemic, providing them with increased visibility, greater operational efficiencies, and automation - helping reduce risk. As the powerful association between procurement and business continuity comes into focus, we hope to help more organizations tap into strategic sourcing as an essential part of their success.”

Pandemic Impact

  • 95 percent report disruption to their company’s sourcing and supplier management process from the pandemic
  • 92 percent classify the digital maturity of this process as less than best-in-class going into the global crisis

Risks to Business Continuity

  • More than half (55%) say the pandemic will continue to be one of the most disruptive factors to their business continuity over the next 12 months, followed by geopolitical factors (43%) and changing market conditions apart from the pandemic (36%)

Existing Challenges

  • 76% say their company does not have strong visibility into the risk, compliance, and performance of individual suppliers, with 28% describing their capability in this area as weak
  • 28% noted weakness in their ability to segment suppliers and to analyze supplier data in general

The greatest challenges to achieving optimal visibility into supplier performance included:

  • Information on suppliers being siloed between business functions and/or lines of business (36%)
  • Procurement systems not being integrated with suppliers’ systems (36%)
  • Lack of centralized management systems for procurement (35%)
  • Fragmented info due to reliance on legacy technologies and inconsistent monitoring of suppliers (32%)
  • Lack of data analysis capabilities (26%)

2021 Agenda

  • Most companies (60%) say the pandemic has fast-tracked plans to upgrade and automate sourcing and supplier management
  • When it comes to procurement and supplier management processes, the top three initiatives companies will implement over the next 12 months are: Accelerating automation of procurement processes (45%), Digitizing more supplier information (43%), Expanding data analysis capabilities of the supplier base (37%)

Embracing Cloud Platforms

  • An overwhelming majority of respondents (93%) are either already using cloud platforms, plan to use them, or are not yet but believe they should be using them
  • Those already relying on cloud tools have seen the greatest benefits in data analysis of supplier information (46%), collaboration (43%), and onboarding of suppliers (41%)
  • 28% highlighted that cloud-based sourcing/supplier management tools gave them greater visibility into risk, compliance, and performance of individual suppliers

Latest