81% CPOs Say Enhancing S2P Speed and Efficiency a High Priority: ProcureCon Survey
- Improving source-to-pay processes and reducing operating costs are top priorities for the majority of CPOs this year.
- They can start tackling those priorities through technology implementation, contract negotiation and supplier optimization.
- Improving collaboration with critical suppliers can help CPOs manage those relationships for long-term value.
May 03, 2023 | Procurement Strategy
Among the 2023 ProcureCon CPO report’s findings – the growing importance of source-to-pay (S2P), 81% of survey respondents indicated that enhancing the speed and efficiency of S2P activities was a high priority over the next 12 months.
Reducing operational costs came in only slightly behind in importance at 71%.
As the report notes, procurement leaders can achieve both of these priorities with a combination of technology implementation, contract negotiations and supplier optimization. Many companies will likely either be deploying new S2P solutions or looking to optimize their systems already in place.
This blog will look at how each of these three approaches can aid CPOs in achieving their most crucial priorities this year.
Modern Platforms Enable Focus On End-To-End Procurement
Modern procurement software has revolutionized the way procurement departments manage source-to-pay activities. These platforms offer a range of digital tools that enable CPOs to streamline processes, making them quicker and more efficient.
With advanced features such as automated workflows, online collaboration and real-time analytics, procurement platforms eliminate manual processes and reduce the risk of errors. This ensures that procurement teams can focus on more strategic activities such as supplier management and innovation.
Moreover, these platforms provide greater visibility into the procurement process, enabling CPOs to make data-driven decisions and optimize spend.
By reducing operational costs, procurement platforms allow CPOs to drive greater value for their organizations and achieve their procurement objectives more effectively.
In summary, modern procurement platforms are essential for CPOs who want to optimize source-to-pay activities, increase efficiency and reduce costs.
CPOs Playing a Greater Role in Contract Negotiations
In addition to strategic efforts to reduce costs by driving implementation of technology to streamline and make procurement activities more cost-efficient, CPOs are an important part of the contract negotiation process.
Chief procurement leaders these days benefit from being more hands-on in engaging in supplier negotiations, especially with their most critical partners. To reduce costs strategically and drive value optimization with suppliers, direct involvement from the CPO is increasingly a necessity.
Also read: Mitigating Inflation’s Effects Top Focus Area for 41% CPOs: Survey
Optimize Supplier Relationships for Value
Managing supplier relationships for mutual long-term value has a significant role in ensuring long-term cost reduction and risk mitigation. CPOs can play a role in driving increased collaboration and innovation with crucial suppliers.
The key to optimizing supplier relationships lies in effective supplier management that focuses on building strong, collaborative partnerships. This not only helps in streamlining the procurement process but also drives long-term value for the business by improving the ability of procurement teams to mitigate risks and innovate to find new solutions.
By optimizing supplier relationships with the help of modern procurement software, CPOs can reduce costs, improve operational efficiencies and accelerate their source-to-pay processes, helping them gain a competitive advantage amid an increasingly uncertain economic outlook.
CPOs Must Be Negotiators and Technology Leaders
Reducing costs is still a priority for CPOs and will always be a huge part of the procurement function.
However, the necessity of leveraging new technologies to collaborate more effectively with suppliers and mitigate the myriad risks in today’s disruption-prone environment make their increasing involvement in tasks like supplier negotiations and technology implementation almost inevitable. By expanding into these areas, they can continue to make S2P processes more effective and cost-efficient.
For more on how the CPO’s role and priorities are changing this year, download The 2023 ProcureCon CPO Report, available on our Knowledge Bank.
