What is Planned Procurement and How Should You Implement it?

Procurement teams can no longer afford to operate in a reactive mode. Ad-hoc procurement processes lead to inefficiencies, missed opportunities, and a lack of strategic alignment across the enterprise. This is where the concept of planned procurement can be a transformative.

For procurement leaders seeking to drive greater value, control costs, and mitigate risks more effectively, planned procurement offers a path toward optimization and procurement excellence.

What is Planned Procurement?

Planned procurement is the practice of proactively managing procurement efforts by looking ahead at the entire procurement lifecycle. This involves:

• Maintaining full visibility into upcoming contract renewals, funded projects, and sourcing needs
• Forecasting demand and predicting future procurement scenarios
• Aligning procurement initiatives with overarching business objectives
• Allocating resources efficiently to support both strategic and tactical activities

By taking a planned approach, procurement teams can move away from reactive firefighting and operate with greater agility, responsiveness, and strategic impact.

Technology as an Enabler to Planned Procurement

While the principles of planned procurement are rooted in process optimization, technology serves as a critical enabler. A comprehensive digital procurement strategy, powered by advanced software solutions, provides the capabilities needed to truly operationalize planned procurement.

Key Technology Elements that Support Planned Procurement

End-to-End Process Automation and Integration:

Connecting disparate systems and automating workflows provides procurement with integrated data flows, greater transparency and better collaboration.

Intelligent Spend Analytics:

Harnessing the power of AI and ML, intelligent spend analysis tools offer a dynamic view of an organization’s spend history, anomalies and projections of future buying needs.

AI-Driven Contract Management:

With the help of contract management software powered by AI, teams can easily monitor renewal dates, assess obligations, and model the ‘what ifs’ of sourcing arrangements to optimize supplier agreements.

Continuous Risk Monitoring:

Continuous monitoring of supplier risk profiles, combined with early warning systems and mitigation protocols, helps procurement teams proactively address potential disruptions.

Scenario Modeling and What-If Analysis:

Exploiting advanced analytical and simulation capabilities, scenario modelling and what-if analysis tools enable procurement teams to examine multiple variables to optimize different procurement strategies.

The Path Forward

Prioritizing planned procurement strategies driven by technology is essential to boost operational efficiency.

By adopting robust digital procurement solutions, teams can elevate their function, enhance their strategic impact and unlock new levels of value creation.

In the unpredictable landscape planned procurement allows leaders to be proactive, data-driven and tightly aligned with the needs of the company. The result is – optimized processes, effective risk management and cost savings.