Member Article

Procurement heads reveal the reasons why technology doesn’t always deliver promised benefits

An eProcurement benefits gap – highlighting where and why procurement systems sometimes don’t deliver fully on their promises – has been uncovered by an independent survey of over 200 senior procurement professionals in the UK.

The research, conducted by Sapio and commissioned by Wax Digital, reported that while procurement technology is giving many businesses a strong advantage, there are critical barriers to overcome if it is to achieve its full potential. IT support, resistance to change and budget are just some of the areas respondents claim are holding them back from achieving their full eProcurement goals.

However, the outlook is good; of the 97% who still have benefits to achieve, 42% say they will achieve these fully and 57% said they will generate more benefits, even though they probably won’t realise every advantage. Only 1% said they couldn’t achieve any more benefits at all.

All survey respondents use eProcurement, and they said that on average they were realising 52% of the full range of eProcurement benefits they thought they could achieve.

Overall, the survey found a 23% gap between the benefits being achieved to a large extent today and those expected to be realised over the full lifecycle of their eProcurement system. Affecting 37% of respondents, personal productivity was the largest benefits gap, suggesting that some eProcurement systems may not be very intuitive to use and don’t make life simpler or easier for people using them.

Other significant benefits gaps include lack of more accurate processes, felt by 32%; lack of process efficiencies, for 29%; little customer satisfaction impact, for 28%; limited cost savings, expressed by 28%; low impact of spend reduction, for 26% and; lack of improved spend visibility for 26%.

Organisations can help to bridge these benefits gaps by dealing with the following eProcurement implementation barriers highlighted by the research: • Barrier 1 ‘complexity’ – occurs when procurement processes are too manual or complex for organisations’ current eProcurement systems to handle • Barrier 2 ‘budget’ – refers to procurement systems that are needed but there is not enough budget to proceed with implementation. • Barrier 3 ‘analytics’ – when there’s no ability to analyse eProcurement data and clearly measure outcomes and benefits achieved as a result. • Barrier 4 ‘IT support’ – results from a lack of support for eProcurement initiatives from within the organisations wider IT strategy and infrastructure. • Barrier 5 ‘reluctance to change’ - is due to internal resistance to new systems among procurement teams and users.

Daniel Ball, director at Wax Digital, comments: “These research findings show that there is a real appetite to improve the performance and effectiveness of procurement through technology and there are many strong solutions on the market to help them do this. However, if the wrong technology choice is made or the conditions for implementation are not carefully planned, organisations may only achieve some of the potential benefits.

“Procurement professionals clearly know what stands in the way of them extracting the most from eProcurement. Now they need to focus on how to successfully minimise these barriers and increase their project outcomes.”

This was posted in Bdaily's Members' News section by Alex Brown .