Talent management is a roadblock for 30% of procurement professionals but 63% don’t have a talent management strategy to address it, SAP Ariba’s 2018 Chief Procurement Officer survey found.
This is the top inhibitor for function efficiency for the Asia Pacific region, according to the report, but was not listed as highly in the rest of the world.
The survey results were released at the SAP Ariba Live conference in Amsterdam today.
It found that 63% of participants do not have a talent management strategy or are in-process of developing one.
Almost a third (30%) of participants indicate lack of internal know-how and talent shortage as roadblocks for making the organization more efficient
“63% of participants do not have a talent management strategy or are in-process of developing one”
Shivani Govil, vice president of AI and cognitive products at SAP Ariba, said that artificial intelligence and machine learning technology can help to fill the talent gap as they “allow you retain knowledge of people using the systems”.
“Applications can start learning the behaviour of your best buyer. You are upskilling your talent in some respect,” said Govil.
“Today most people are bogged down by tasks so, by bringing in technology, people can start thinking about what else they can bring to the business.
“You’re also enabling attraction of new talent. Generational workforces becoming in are very aware of technology and having it attracts top talent to your business to work on the procurement space,” she added.
Marcell Vollmer, SAP Ariba’s chief digital officer, also argued that a talent gap has been created as the procurement industry does not sell itself well enough.
“This is what a lot of executives are missing: how beautiful the function is”
“This is what a lot of executives are missing: how beautiful the function is,” said Vollmer.
Young people should join the procurement function to see how a wider the organisation works, before choosing a role elsewhere in the company, he argued.
“Sales is the same as procurement but from another side. Companies under sell procurement, when sales achieve something [it is celebrated]. This needs to change so people say they want to work in procurement,” said Vollmer.
“83% of respondents believe that digital transformation will be impactful but only 5% of respondents have highly automated processes”
The survey also found that 83% of respondents believe that digital transformation will be impactful but only 5% of respondents have highly automated processes.
What’s more, 83% of participants think that digital transformation will impact procurement, supply chain and finance more in 2018, than in 2017, the survey found.
Vollmer said that he asks clients what technology they use and what they want to change?
“IT is now ranked the number one most used department now. When you ask people what they want to use, they often say AI,” Vollmer said.
“Technology can create a smaller procurement department, but it will be more value orientated and more efficient,” he added.
One example of this can be found in energy company Shell. Its procurement function is using SAP technology to drive a more sustainable supply chain.
“As a consumer, we care about where our products and their ingredients come from,” said Vollmer.
In regard to AI, Govil said: “We don’t think robots will replace suppliers. AI will be more of augmented intelligence.
“It will free up [employees] time, so they can focus on more value-added tasks. Something done by a casual user that is very repetitive can be automated to free up time, but if something is non-repetitive and requires expertise, AI can provide data to help these individuals to do a better job,” she said.
One example of a procurement role requiring human expertise is contract negotiation.