Procurement executives in Ireland and the UK are more concerned than their global peers about rising inflation, cost pressure, global supply shortages, and their ability to contain those pressure, according to a report by PwC.
PwC’s 2022 Global Digital Procurement survey of more than 800 procurement executives in 64 countries, including Ireland, gives an overview of the digital trends, investment, concerns and opportunities in procurement functions. Procurement executives are responsible for evaluating suppliers, products and services, negotiating contracts and ensuring that approved purchases are cost-efficient and of high quality.
The survey suggests talent retention and upskilling are also of greater concern in Ireland and the UK compared to global counterparts.
Ireland and UK procurement functions have “ambitious digitalisation targets”. More than eight out of 10 (84 per cent) Irish and UK companies reported having technology platform solutions already in place for their key payment processes, which was 7 per cent higher than global counterparts.
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Involving internal stakeholders and being conscious of the corporate culture were seen as the key success factors for driving digital transformation.
The survey shows there is significant focus on data analytics in procurement functions in Ireland and the UK, with 76 per cent ranking this as the top technology in the years ahead.
Two-thirds of UK/Ireland respondents scored a carbon emission tracker tool to improve the sustainability of their future supply chains as critical for providing value.
PwC Ireland procurement director Mark McKeever said: “Advanced analytics is a key enabler to drive more responsive and informed decisions and will play a more critical role in the future.
“With significant digital investment plans afoot, the survey suggests that procurement functions are well placed to seize the opportunities and play a greater strategic role within their organisations into the future.”
More generally, the report said investment in digital procurement in companies around the world is set to increase by at least 33 per cent by the end of 2022 compared to 2020 levels.
Key emerging digital tools, according to procurement executives, are supply chain traceability and supplier carbon emissions monitoring.
The report shows carbon emission tracking tools are expected to become a game-changer for procurement functions, with 27 per cent of companies surveyed already using this emerging technology within their organisation.
PwC Ireland consulting partner Garrett Cronin said: “We are seeing digital transformation within global and Irish procurement functions ramp up. Digital technologies are becoming critical, not only in payments processes, but also in terms of measuring carbon emissions within supply chains.
“However, greater focus will be needed in the future on data accuracy and availability as well as retaining key people.”
The report also says 90 per cent of survey respondents already use digital procurement solutions such as source-to-contract or procure-to-pay tools.
More than half (55 per cent) of respondents admitted to having difficulties in leveraging their procurement data.
Nine out of 10 procurement executives are concerned about cyber threats, with more than a quarter (27 per cent) having experienced an intrusion.
Digital transformation is also motivated by risk management and compliance, in addition to traditional objectives of cost reduction and process simplification.
