Fact or Fiction: Procurement Myths & Truths You Should Know

Categories : Procurement Goals | Set Strategy Published on : May 18 2018

By: ProcurementIQ Staff Writer, Ashley McKay

Every day we log on to our computers or mobile devices and are bombarded with all kinds of headlines. Some are click-bait, some are opinion-based, some are true and some are speculation. In a recent article, “The Facts and Myths of Procurement,” supplier relationship management solution provider, Kodiak Rating, dissects some of the headlines that we hear in procurement and analyzes how much truth are actually in them.

Let’s dive into a couple of the facts and myths that were highlighted by Kodiak Rating:

Artificial Intelligence will Take Over the Procurement World

The discussion around has become a common one. We’ve all seen tons of headlines on this topic, mostly how it might disrupt several industries across the board and how it can and will eventually replace human workers.

Well, in regards to procurement, according to Kodiak Rating, this one’s a MYTH. “AI and artificially intelligent technologies will bring procurement cognitive capabilities, but that is a reality that is much further off than one may want to believe. Machine-to-machine capabilities have been realized, but tech vendors haven’t yet discovered AI’s full potential. Furthermore, there are only a handful of procurement teams that have deployed artificially intelligent solutions into their digital procurement strategy.”

Procurement Prioritizes Cost Above All

This is another we here often. In recent years, we’ve also heard and read about more departments wanting to move away from this. “Transformation” and “moving from a cost center to a profit center” has been a popular theme in some headlines.

Unfortunately, Kodiak Rating has listed this one as a FACT. While it is true that more departments are trying to follow more ethical business practices and are becoming more conscious of their corporate responsibility when purchasing goods and services, cost savings still seems to be at the top of the priority list for procurement. The article states, “While procurement remains a function driven by cost-reduction, market shifts have shown that procuring with responsible business practices in mind could very well be the cost-efficient choice.” However, “The 2018 CPO Survey by Deloitte shows contradictory feelings about CSR as a priority in procurement orgs.”

To read Kodiak Rating’s full article and see more insight from Deloitte’s 2018 CPO Survey, click here.

 

For more on trends impacting procurement, read
Top 5 Procurement Trends in 2018

 

Let us know which procurement trends you think are fact or myth on Twitter and tag us @ProcurementIQ!



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