How to overcome Procurementchallenges with consistency and accountability in an evolving landscape? Udit K Chandok throws light on howorganizations can turn procurement from a logistical challenge into a strategicadvantage.
By embracing innovation,sustainability, and accountability, procurement can unlock new opportunities,contributing to India’s economic potential and shaping a future of resilienceand prosperity.
- Udit K Chandhok, Founder and CEO, WCube.
Nowadays, in aninterconnected and rapidly changing world, procurement has emerged as a crucialcomponent of business success. Its complexity has been highlighted by recent events,such as the worldwide supply chain disruptions during COVID-19. Businessesexperienced delays, cost overruns, and strained supplier relationships,underscoring the necessity of a strong procurement strategy. As this landscapechanges, how can organizations turn procurement from a logistical challengeinto a strategic advantage?
The Procurement as aService (PaaS) market in India is growing at an impressive rate of 11.2 percent annually. Globally valued at US$6.88-billion in 2024, it is projected toexceed US$25.19-billion by 2037, underscoring its transformative potential.
Evolution of the Procurement landscape
Procurement’s emphasis hashistorically been on efficiency and cost reduction. However, by utilizingcreative methods and aligning sourcing plans with business objectives, contemporaryprocurement aims to provide value.
Supply chains have becomelonger due to globalization, which has made logistics and supplier managementmore difficult. Innovations in technology, such as blockchain and artificialintelligence (AI), are changing the way procurement procedures are carried out.
Demands for ethicalsourcing from consumers and regulations have made sustainability a toppriority. Furthermore, companies must implement accountable and transparentprocurement methods due to increased compliance obligations.
Core Procurement challenges
Fragmented Processes and Inconsistencies: A lack of standardized procurement procedures, resultsin ineffectiveness and miscommunication within teams.
Accountability Gaps: Poor decision-making and trouble enforcing adherenceto contracts and policies can arise from unclear roles and duties.
Issues with Risk Management: Geopolitical tensions, unstable markets, and supplierdisruptions pose risks to procurement teams. Moreover, environmentalconsiderations complicate sourcing choices.
Trust Deficits: Innovation and cooperation are hampered bytransactional supplier relationships. It becomes difficult to achieve long-termprocurement success without trust.
Overcoming Challenges: The strategic shift
Technology, sustainability,and relationship-building are driving a strategic shift in the field of procurement.Through automation and predictive analytics, technology is making procurementmore efficient and less prone to errors.
Integrating advancementslike blockchain increases transparency by producing safe, unchangeabletransaction records. Businesses are embracing circular economy and ethicalsourcing to ensure long term resilience. Through transparent regularcommunication, vendors are co-developing strategies aligning with suppliers’and business objectives to foster a partnership-driven procurement framework.
The Foundations of Success: Consistency andAccountability
To ensure efficientprocedures and build trust among all departments, consistency andaccountability are fundamental building blocks for successful procurement. Standardizedprocesses for supplier evaluation and procurement strategies helps in achievingconsistency, which improves reliability and reduces unpredictability and errors.
On the other side,accountability encourages responsibility and transparency, which fortifiesprocurement. Technology helps achieve accountability by offering instruments tomonitor procurement activities, monitor compliance, and guarantee thetransparency of decision-making. By improving operational oversight andfostering stakeholder confidence, this strategy guarantees that procurementadheres to performance and ethical criteria.
The future of Procurement
Procurement is changing rapidlydue to shifting societal goals and technological breakthroughs. The increasingintegration of machine learning and artificial intelligence (AI) improvesautomation and enhances the efficiency of the supply chain.
Meanwhile, as companiesemphasize eco-friendly suppliers more and more to meet sustainability targets,green procurement techniques are becoming more popular. Diversity and inclusionwill also play a vital role in creating equitable and innovative suppliernetworks. Procurement teams must promote an innovative and ever-learningculture to adjust to these developments.
In an era whereadaptability defines success, procurement is more than a business function — itis a catalyst for economic growth. India, with its dynamic economic aspirationsto become a global leader, stands at a pivotal juncture where reimaginedprocurement practices can strengthen industries and drive efficiency.
By embracing innovation,sustainability, and accountability, procurement can unlock new opportunities,contributing to India’s economic potential and shaping a future of resilienceand prosperity.