A global study of 417 finance, procurement and supply chain leaders conducted by Forrester Consulting on behalf of Ivalua identifies on-boarding suppliers as a critical success factor in digital transformation.
Using a digital maturity index to assess organizations’ structure, strategy, process, measurement and technology to determine their true level of digital maturity, the study found most organizations significantly overestimate their maturity. Only 16% of businesses had an advanced level of digital maturity in procurement, giving them a source of competitive advantage over rivals, though 65% assessed themselves as advanced.
At the outset of implementation, lack of budget and executive support are primary obstacles. Later in the process, organizations struggle with poor integration across their source-to-pay systems. Advanced organizations were most likely (60%) to be planning to implement a full ePurchasing suite.
The study revealed that organizations frequently make poor choices with regards to technology, which impedes digital transformation. Over three-quarters (82%) switched or are considering switching technology providers. The primary reasons for switching are poor levels of supplier on-boarding (30%) and poor user adoption (27%). On-boarding suppliers quickly is critical for any technology adoption, yet just 17% of organizations are able to do so in less than one month, with 59% taking one to three months per supplier.
Forrester’s research looks at procurement priorities for the next year, what differentiates beginner, intermediate, and advanced procurement teams, and how procurement professionals can create competitive business advantages for their organizations while identifying impediments to digital transformation progress.
The full report, “Executing a Successful Procurement Transformation,” is available here.