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Ian Nethercot, MCIPS, supply chain director at Probrand explains how Procurement and IT can work together even though they may have different agendas.
The relationship between IT buyers and procurement teams can often be a strained one. When IT buyers simply want to get the right technology deployed as quickly as possible, procurement protocols are often viewed as frustrating barriers – despite being absolutely necessary for any organization that wants to protect budgets and achieve value. During 2020, when the global pandemic caused havoc across supply chains, we saw these stresses heightened to new levels.
Covid-19 created a perfect storm when it came to buying IT. First, came restrictions in supply following the shutdown of IT manufacturing factories in Asia and a suspension of air and sea freight. Second, as buyers sought to source ‘work from home’ equipment during lockdown, we saw a huge increase in demand that put a significant strain on existing stock levels.
This resulted in up to 70% of technology products seeing supply levels constrained and IT buyers becoming increasingly desperate as they sought to enable their workforce. The idea of achieving value seemed to be suspended, as buyers purchased products that were massively over spec’d because that’s all they could get their hands on. This included notebooks worth £1,500 being bought to carry out basic admin tasks.
Procurement teams have been fighting to regain control ever since and, with the supply of many products unlikely to catch up with demand until well into 2021, this situation looks set to continue. At the same time, organizations are still trying to progress their digital transformation plans. If organizations are going to both roll out innovative solutions and achieve value during these challenging times, procurement teams and IT buyers will need to work together and adopt a collaborative approach.
In my experience, IT or procurement teams do want to collaborate – but, when consumed by their respective responsibilities on a day-to-day basis, their focus is often on different agendas.
Procurement teams can, of course, put tools and processes in place to protect the business and help IT buyers. For example, by integrating procurement systems with online marketplaces to automate approval protocols and provide IT buyers with quicker access to goods and services.
When it comes to long-term digital transformation strategies, however, a closer working relationship needs to be developed. Given that both sides are likely to be pursuing different objectives, it’s often advisable to include an independent third party in this process. Someone who understands the challenges, can guide the conversation and act as a mediator when called upon.
This process might involve monthly meetings where industry trends can be discussed and problems can be flagged and dealt with. Having a third party in the room, who has knowledge of the current IT climate, will help steer and focus those meetings. They can also take responsibility for any follow-up actions.
One of the biggest benefits to having an independent advisor, however, is that they can help both sides to agree shared targets and ensure they tackle the big strategic issues. This may well include those traditional problems that can hold innovation back, such as legacy systems and skills shortages, as well as broader corporate responsibilities, such as sustainability.
At a time when procurement and IT are facing untold pressures, a facilitator would focus everyone’s attention on the common goal and help innovative technology be deployed as efficiently and cost effectively as possible.
*The opinions expressed are those of the author and not necessarily the official position of Spend Matters.
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