A new report released by The Chartered Institute of Procurement & Supply (CIPS) with the University of Melbourne has found that the sharp increase in the necessity for digital capabilities for procurement teams during the COVID19 pandemic is at odds with the technological abilities of many of the companies surveyed.
For instance, 40 per cent of the companies responding to the survey cited cost as a big obstacle to progress when implementing digital technologies in terms of set-up, training and ongoing support. As the pandemic continues to affect businesses and supply chains across the world, the report highlights the gap between the needs of business and procurement teams and the reality of digital progress.
A collaborative effort between CIPS and the University of Melbourne, the report highlights various technology areas that businesses have and have not adopted and where they have struggled to adapt to the sudden acceleration in digital working and automation to keep supply chains running.
The report found that 95 per cent of businesses had already implemented some technological advancements in the last three years, more plan to increase digital capability in the next few years and the report shows the different areas businesses are investing in. The survey was conducted in mid-2019 and featured over 700 respondents worldwide.
Working patterns in organisations across public, private and public sectors have experienced shifts in working cultures. 95 per cent of the companies surveyed had implemented at least one digital technology in the last three years, and cloud computing was the top tech to strengthen digital requirements.
The report highlighted a number of inhibitors to progress such as the training cost for staff on new technologies, maturity levels of technology available or the insufficient levels of support from leadership teams. A number of case studies are also featured around success stories and how businesses succeeded in their digitalisation journey.
CIPS Group CEO, Malcolm Harrison said businesses and organisations scrabble to get ahead in the digital race.
“But take a step back and look at why digital is becoming so important and you’ll realise that investment in technology is not enough.
“There are vast digital capability gaps in all sectors so training and developing understanding is a crucial first step. Then being able to align digital transformation with business needs, involve all key departments in the planning and finally justification of ROI means that digital supply chain transformation has a greater chance to succeed.”
Daniel Samson, Professor and CoEditor in Chief of Operations Management Research, University of Melbourne, said, “While the new digitalisation technologies promise a lot, we advise executives to not get caught in the hype of IoT, AI, Blockchain etc, but rather to consider your whole business model and operations strategy first, and from that context to then carefully choose a technology strategy. We have seen these technologies lead to everything from cost reduction to speed and service improvements when they are implemented correctly and nothing but frustration and wasted effort and expense when they are poorly deployed.
“Firms and their executives cannot ignore these sweeping changes in potential capability, because competitors will be moving the competitive frontier forward through their use. A holistic ‘socio-technical’ approach, will lead to a rethink of what people can do best and what technology can do best in your organisation.”
