A new report from the management consulting firm Accenture predicts that in the next five to seven years innovative digital technologies will revolutionize how procurement is conducted. According to the report, Procurement's Next Frontier: The Future Will Give Rise to an Organization of One, "digital disruptors"—such as cloud computing, analytics, and the industrial Internet of Things—will allow organizations "to gather and analyze more and richer real-time data to drive better, smarter, and more accurate decisions." The most successful companies will use this as a catalyst to question everything procurement does, even such core tools as the purchase order, the report says.
The report's authors, Kai Nowosel, Abigail Terrill, and Kris Timmermans, predict that the procurement organization will use digital technologies to create an IT infrastructure based on the following five "apps":
These technologies will enable procurement to create a hybrid organizational structure, halfway between the old decentralized model, where procurement was scattered among business units, and the newer, centralized procurement model. Under this structure, some procurement professionals will be "embedded" within the business units and focus on applying procurement knowledge to specific business issues. This group then connects back to a smaller, central decision-making team that deals with business strategy, global demand and supply, policy, compliance, and global strategic supplier management.
The full report can be found here.