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CIOInsider India Magazine


The Need to Focus on Digital Technologies and Supplier Synergies

Rajat Arora, Director IT & Global Head - Network & Telecom, Services at Diebold Nixdorf

As Director of IT & Global Head for Networks, I’ve been closely engaged with the Procurement function as we look to invest in future technologies that would change the way we do IT and our core business. I see them as a critical function towards our cost saving efforts, negotiating and strategizing our IT Infrastructure spends in 2019 with vendors and keeping a tab on the supply chain dynamics. The world of procurement has undergone vast changes in the past couple of years. I’ll be touching on some of these trends that Procurement would carry forward from 2018 and continue to operate on in 2019.

Aligned with the organization’s Digital Strategy: For long, the rise of digital technologies and its positive impact on procurement has been projected as a procurement trend. We continue to stay invested in 2019 in transitioning towards cloud and our software defined IT strategy. This lays a solid foundation towards our digital strategy. From automating redundant procurement tasks to empowering C-Suite in decision making, from better market visibility through product innovation to increased profitability, the benefits of digital technologies are enormous, and so is the importance of digital procurement.To realize the maximum value, organizations need to invest in the right infrastructure, processes, and resources with a vision that aligns with their objectives in the long term.

Building Talent Pool to Embrace Digital Technologies: Procurement function has to move from delivering mere cost savings to providing a strategic edge to the organization. It’s quite essential to build a holistic supply chain and to drive enterprise wide cost reductions, for which procurement function has to utilize the maximum

value out of digital technologies such as AI, Robotic Automation and Blockchain in their day to day work.In 2019, the IT organizations especially the procurement functions is going to focus on finding the right talent and at the same time grooming the inhouse resources through specially designed training and skill development programs to stay relevant in the coming times.

Supplier Engagement: With the growing levels of collaboration between procurement and suppliers due to the advent of technology and its changing dynamics buyers cannot just afford to communicate with suppliers over the price. They need to have them engaged on strategic decisions during the initial planning phase. In 2019, more focus would be given in improving work synergies with suppliers. Managing risk becomes more effective and transparency increases which empowers the suppliers and promotes healthy competition amongst them eventually benefiting the organization.

With the increasing expectations from procurement, we’ll continue to see it deliver on traditional cost savings while focusing heavily on digital technologies and supplier synergies

Risk Management: From Brexit to trade wars (the US imposing tariff sanctions on China)to fluctuating oil prices, major world economies are continuously thriving to be prepared for the unexpected. With these uncertainties, procurement function would be at the forefront of an organization for risk minimization. Procurement in 2019 will have to remain at the top when it comes to minimizing the supply chain costs. It will require bringing in innovation and technology interference to save costs wherever necessary. Moreover, organizations are always struggling from internal risks arising due to lack of transparency. Being compliant with legal standards is just not enough these days. With

Effective Change Management: Procurement leaders have time and again agreed change management being the biggest roadblocks in achieving the outlined procurement goals. With the advent of digital technologies, the transactional work in a procurement function is becoming automated. As a result, the extra time available due to automation can be deployed by resources in more strategic activities that a business needs. But the transition to change management is not easy, as it brings a sense of insecurity about the end state and hence resistance to undertake new initiatives. In 2019, more organizations will focus on a smooth change management plan through increased focus on regular communication with the employees; engage them through the process and by providing adequate training and support.

So to conclude, with the increasing expectations from procurement, we’ll continue to see it deliver on traditional cost savings while focusing heavily on digital technologies and supplier synergies. Overall, 2019 seems like a promising year full of challenges and opportunities for procurement to undertake.

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