• Digital Brings New Challenges for IT Procurement

Life is tough for an IT procurement or category manager; it always has been. Over the last 25 years the pace of change has been greater than in any other period. Simply keeping up with product and supplier knowledge has been a huge task. The need to find successful ways of working with IT managers – the key internal stakeholder group – has added an additional challenge.  Something which frankly, only the best IT category managers were up to.

The “digital revolution” has brought even more complexity to the role. Previously, the internal stakeholders sat firmly within the IT department, now, every executive is potentially their own CTO. With the growth of cloud-based software and solutions, apps that can be downloaded in seconds. We also have far greater technology awareness and capability among the Millennials now rising up our organisations. These factors have combined to make life challenging.

Procurement professionals working

The business user now expects the software they use at work to be as intuitive and user-friendly as the platforms they use in their personal lives; such as Amazon, eBay, Facebook, YouTube.  They expect high functionality and resilience; but above all, greater usability. And if the IT department is not providing the right tools, the user of today will find, download and implement their own - and they probably won’t involve procurement.

Now this brings real issues for the wider organisation as well as for the procurement and IT functions. Security is an obvious area of concern, as is the potential loss of consistency. We are seeing this trend in our own core area of procurement-related software; imagine if every department or business unit in our organisation started using their own local ordering and invoicing systems. Maintaining control of expenditure would be virtually impossible, and deriving spend data across the whole entity could become almost impossible.

In that particular case, we would suggest that a key role for the Chief Procurement Officer of today and tomorrow is to define the procurement systems infrastructure that the organisation will adopt, and explain to senior management why a certain amount of governance is needed to implement and police it. However, it is vital that systems also meet the needs of the user – remember, our colleagues won’t accept technology that does not match up to their expectations in terms of usability and functionality.

As to the wider questions around what we might call the “user revolution”, IT category managers need to work closely with the IT function to put processes in place that allow users some flexibility and freedom. Procurement should understand and highlight the commercial risks of “spend anarchy” – but both functions need to recognise that the world of digital is different, and it has led to a more informed user community. So IT procurement professionals must work out how they can help users get the most out of the digital genie – not try to put him back into the bottle!