Having been involved in organization change management for over 10 years across multiple industries, I wanted to share my experiences to assist fellow change managers in the never-ending fight for change.
The procurement function is undergoing a digital transformation that promises to enhance efficiency, transparency, and value creation. However, adopting new technologies also brings significant changes and challenges that require careful planning and management.
How can procurement leaders and professionals navigate the complex and dynamic landscape of digital procurement and ensure a smooth and successful transition?
Here are some key steps and strategies to consider.
Assess the current state and the desired state
Before implementing any new technology, it is important to have a clear understanding of the current state of the procurement function and the desired state that the technology will enable.
This involves conducting a gap analysis to identify the strengths and weaknesses of the existing processes, systems, and capabilities, and the opportunities and threats that the new technology will bring. The gap analysis should also consider the needs and expectations of the internal and external stakeholders, such as the business units, suppliers, customers, and regulators.
Based on the gap analysis, leadership should define the vision, goals, and objectives of the digital transformation, and align them with the overall organizational strategy and culture.
The vision should articulate the value proposition and the benefits of the new technology, such as cost savings, improved quality, faster delivery, better compliance, or increased innovation.
The goals and objectives should be specific, measurable, achievable, relevant, and time-bound, and should serve as the basis for evaluating the performance and outcomes of the digital transformation.
At this stage, it is also important to engage the stakeholders and solicit their input and feedback on the vision, goals, and objectives of the digital transformation.
This will help to ensure that the digital transformation is aligned with the needs and expectations of the stakeholders, and that they are aware of and supportive of the changes and benefits that the new technology will bring. It will also help to identify and address any potential issues or concerns that the stakeholders may have, and to build trust and collaboration among the stakeholders.
Select the right technology and the right partner
The next step is to select the appropriate technology and the appropriate partner to support the digital transformation.
There are many types of technologies that can be used to enhance the procurement function, such as cloud-based platforms, artificial intelligence, blockchain, internet of things, or robotic process automation. Each technology has its own features, advantages, and limitations, and may not be suitable for every organization or situation. Therefore, it is essential to conduct a thorough research and analysis of the available options, and compare them based on criteria such as functionality, scalability, compatibility, security, cost, and user-friendliness.
Similarly, choosing the right partner to provide the technology and the related services is crucial for the success of the digital transformation. The partner should have the expertise, experience, and reputation in the field of digital procurement, and should be able to offer customized solutions that meet the specific needs and challenges of the organization.
The partner should also have a strong track record of delivering quality, reliability, and customer satisfaction, and should be able to provide ongoing support and maintenance. The procurement leaders should establish a clear and transparent communication and collaboration with the partner, and ensure that the roles, responsibilities, and expectations are well-defined and agreed upon.
In selecting the technology and the partner, the procurement leaders should also involve the stakeholders and seek their opinions and preferences. This will help to ensure that the technology and the partner are suitable, and help to foster a sense of ownership and commitment among the stakeholders.
Plan and execute the implementation
Once the technology and the partner are selected, the procurement leaders should develop and execute a detailed and realistic implementation plan that covers all the aspects of the digital transformation.
The plan should include the scope, timeline, budget, resources, risks, and contingencies of the implementation, and should be aligned with the vision, goals, and objectives of the digital transformation. The plan should also specify the milestones, deliverables, and indicators of the implementation, and should be monitored and reviewed regularly to track the progress and performance.
The implementation of the new technology should follow a phased and iterative approach, rather than a big bang approach, to minimize the disruption and the risk of failure.
The procurement leadership team should start with a pilot or a prototype of the technology, and test it on a small scale and a limited scope, before rolling it out to the entire organization and the entire procurement process.
The pilot or the prototype should be evaluated and refined based on the feedback and the results, and the lessons learned should be applied to the subsequent phases of the implementation.
They should also ensure that the new technology is integrated and compatible with the existing systems and processes, and that the data and the information are transferred and stored securely and accurately.
During the implementation, the procurement leaders should also communicate and collaborate with the stakeholders and the partner, and keep them informed and updated on the status and the outcomes of the implementation.
The procurement leaders should also provide regular and timely reports and feedback to the stakeholders and the partner, and address any issues or problems that may arise. While also acknowledging and appreciating the efforts and contributions of the stakeholders and the partner, and celebrate the achievements and the successes of the implementation.
Manage the change and the resistance
The implementation of the new technology is not only a technical change, but also a cultural and behavioral change that affects the people and the processes involved in the procurement function.
Therefore, it is imperative to manage the change and the resistance that may arise from the introduction of the new technology, and to foster a positive and supportive environment that encourages the adoption and the adaptation of the technology.
Adopting a proactive and participatory approach to change management, and involving the key stakeholders in the planning and the execution of the digital transformation is crucial.
The procurement leaders should also communicate the vision, the benefits, and the expectations of the new technology, and address the concerns and the questions that the stakeholders may have. Additionally, it’s imperative to ensure that the procurement staff and the other users of the technology have enough training and coaching, and have the skills and knowledge they need to use the technology well and productively.
One of the main sources of resistance to the new technology may be the fear of losing jobs or skills, or the reluctance to change the existing habits or routines. To overcome this resistance, the procurement leaders should emphasize the positive aspects of the new technology, such as how it can enhance the productivity, quality, and satisfaction of the procurement staff and the users, and how it can create new opportunities for learning and development.
It is important to reassure the staff and the users that the new technology is not meant to replace them, but to complement and support them, and that they will still have a valuable and meaningful role in the procurement function.
The Road Ahead
Integrating technology in the procurement function is a strategic and beneficial move that can enhance the performance and the value of the procurement function.
However, it also requires a careful and comprehensive change management that addresses the changes and the challenges that come with the digital transformation.
By following the steps and strategies outlined above, and by adopting a consultative and collaborative approach, procurement leaders and professionals can ensure a smooth and successful transition to the era of digital procurement.