Diversifying procurement will involve ensuring organisations are engaged with a variety of suppliers in different geographic regions. Ultimately, this will mean relying less on China, a challenge as the Eastern nation remains a juggernaut in the manufacturing. This diversification can be achieved by ensuring several suppliers are engaged in case one relationship turns sour or they can no longer supply your need. This will help improve an organisation’s flexibility whilst still maintaining profitability and efficiency.
In contrast with the traditional focus of cost-cutting in procurement strategies, a push for sustainability will be prominent in 2022. Sustainability involves multiple elements including ethical environmental sustainability and also the relationship with suppliers and their ability to consistently supply your requirements. Building healthy relationships with your suppliers leads to stable procurement. This principle also links with diversification which helps to improve the maintainability of procurement.
Advancements in technology since the turn of the century has revolutionised procurement processes and indeed the entire business. In 2020 and 2021, technology once again transformed the way people did business. In 2022, the role of technology will again increase. Organisations will prioritise digitalisation and automation to streamline the procurement process making it more efficient and effective which has flow-on effects throughout the rest of the organisation. Automation of operational tasks will open up more time for employees to dedicate towards strategic thinking tasks. Along with this, technology can be useful in forecasting and minimising risk.
More responsibility on procurement leaders and their teams
Over the past two years, procurement has become an increasingly integral part of successful organisations. This means a greater responsibility has been placed on the shoulders of the procurement leaders and their teams. As a result, high performing procurement members and teams will be demanded by organisations.
Need to be prepared
If the pandemic has taught us anything, it has taught us to expect the unexpected. These unprecedented circumstances have forced procurement teams to adapt, dealing with strained resources, uncertain supply, and the constraints of remote working. Being prepared requires stable supply lines, even if it means at a greater cost. As mentioned earlier, the flexibility afforded by this approach will help minimise disruptions. Crises like the current one are largely unavoidable events that present obstacles requiring preparedness and innovation to overcome. Preparing for these kinds of circumstances will form a procurement team that is ready for unforeseen events.