Research from Ivalua, a leading provider of global spend management cloud solutions, has found that almost half (48%) of UK telecommunications organisations are frustrated by a lack of digitalisation in procurement. According to the study, 48% of respondents believe that the rate of digitalisation within procurement is low, while over a third (36%) claim that procurement digitalisation is stagnant and hasn’t progressed in the last 12 months.
The research, conducted by Vanson Bourne on behalf of Ivalua, surveyed 200 UK-based procurement, supply chain, finance professionals to examine digitalisation in procurement. More than eight-in-ten (85%) UK telcos say a lack of digitalisation is preventing them from collaborating with suppliers and internal stakeholders, while 88% believe it is preventing them from innovating and executing on new revenue streams and opportunities. Additionally, nearly two-thirds (63%) say a lack of digitalisation reduces their ability to gain insights into spend and suppliers.
“As organizations look to restore growth post Covid-19 and ensure resilience for the next crisis, procurement can play a major role, helping identify opportunities to innovate and new sources of revenue. Procurement digitalisation is essential to enable unique business processes and improve collaboration with suppliers and internal stakeholder,” commented Alex Saric, smart procurement expert at Ivalua. “However, the current state of transformation in procurement is underwhelming. The risk in the future is that many businesses will be outstripped by more digitally-savvy rivals and find themselves at a significant competitive disadvantage. Over the coming years, UK telcos need to move quickly to digitally transform procurement and ensure they are not left behind.”
Digitalising processes still has a long way to go
While many recognise the need to digitally transform, the report found that on average, UK telecommunications organisations have digitalised less than half (36%) of their procurement processes. The most digitalised tasks were transactional processes such as invoicing (39%), purchasing (32%) and budget management (32%).
UK telecommunications organisations have also failed to digitalise strategic processes such as spend analysis (43%) and risk management (21%). Identifying and bringing on new suppliers is also critical for businesses looking to identify new opportunities to collaborate and innovate, but worryingly, most have not digitalised supplier onboarding (93%) or sourcing (86%) processes. When it comes to digitalising procurement and these processes, telcos face a number of challenges, with the most common obstacles to digital transformation being their suppliers (30%), their technology (18%) and their processes (12%).
“Procurement has become a much more strategic part of every business, but a lack of digitalisation is preventing many teams from realising the potential value of their spend and suppliers. UK telecommunications organisations need to take a smarter approach to procurement and move away from managing processes over email, phone, or paper, to instead capture everything digitally. This will help them identify opportunities to innovate, collaborate and grow revenues, giving them the chance to build better products and services that will differentiate them from the competition. Digitalising procurement creates an all-encompassing view for businesses, helping to create a competitive advantage that will see them soar past digital laggard competitors,” concludes Saric.
To download the full report, “Gaining the advantage in challenging times – why businesses need to digitally transform procurement now more than ever”, please visit: https://info.ivalua.com/uk/report-competitive-advantage