The document discusses how procurement must undergo a "digital transformation" or "eTransformation" to adapt to today's disrupted business environment. It emphasizes that this transformation is necessary for procurement to increase the value it provides to the organization and ensure its survival. The transformation requires a holistic approach focusing on people, processes, and technology to make procurement effective, efficient, and sustainable for the long run.

3. Procurement in the Digital
Age
Bertrand
Maltaverne
Brittany
Whitmore

4. Since 2014 POOL4TOOL Senior Business Consultant & Product Marketing
2013 - 2014 Schneider Electric, Global Indirect Procurement Tools Manager
2009 - 2012 Schneider Electric, EMEA Indirect Procurement Tools & Process
Manager
2004 - 2009 Schneider Electric, Global Purchasing Application Manager
2001 - 2004 Schneider Electric, Purchaser for Direct Materials
1998 - 2001 Schneider Electric, Technical Manager
About :
The only all-in-one platform for Direct Procurement:
• Strategic Procurement: Category Mgmt., SRM, …
• Operational Procurement: eSourcing, Supplier Perf., Quality and Issue Mgmt....
• Supply Chain execution: Supplier Network / Portal, PO, ASN, VMI, ...
Bertrand Maltaverne
https://at.linkedin.com/in/bmaltaverne

5. What I think of
Procurement…
as demonstrated by recent stuff I wrote (personal & professional sides)
Sources:
- Personal “blog”  https://medium.com/procurement-tidbits
- Whitepaper  https://www.pool4tool.com/cms/en/resources/whitepaper/procurementvalueengine

6. Why is it now or
never that
Procurement has to
re-invent itself?

7. Procurement has a unique
position!
PROCUREMENT
Outside
Inside

8. P = SRM2…
Source: https://medium.com/procurement-tidbits/the-hidden-meaning-of-srm-7a4aaaa7455d#.v3z9flyu9

9. P = SRM2…
SRM as Supplier Relationship Mgmt.
SRM as Stakeholder Relationship
Mgmt.

10. Procurement has a unique
position!
PROCUREMENT
Outside
Inside
VALUE

11. Procurement has a unique
position!

12. Internal and external
pressures…
Internal:
– Recognition & credibility (“seat at the table”)
– Customer satisfaction (savings and more…)
– Skills and war for talent
– ...
External:
– Disruptive technologies impacting supply-market
– Globalization & volatility
– Risks
– ...

13. It is no “BS”! Evidence #1
Skills gap widening say CPOs in “Supply Management” - Feb. 2016
Article based on The Deloitte Global CPO Survey 2016.

14. It is no “BS”! Evidence #2
When your internal customers see you like that…

15. It is no “BS”! Evidence #2
Then this can happen…

16. It is no “BS”! Evidence #3
Technology transforms everything…
Source:
You are here!

17. It is no “BS”! Evidence #3
Technology transforms everything… Example of the
automotive industry. It was “born” thanks to a
disruptive approach!
“If I had asked people what
they wanted, they would
have said faster horses.”
— Henry Ford

18. It is no “BS”! Evidence #3
Technology transforms everything… Example of the
automotive industry. It is undergoing constant
(r)evolutions.
Electrical
cars
Self-driving
cars
Rental
economy

19. It is no “BS”! Evidence #3
Technology transforms everything…
Your customers change, your product changes…
So, what you need to buy changes…
Supply-markets change (3D printing, rental
economy...). So, what you actually buy changes
(new spend categories, new suppliers)...
 Your Procurement “system” needs to
cope with all of this!
Source: Roland Berger Strategy Consulting, “THE DIGITAL TRANSFORMATION OF INDUSTRY ”

20. A perfect storm!
Agility to maneuver!

21. Source:
The solution: adapt to always be a
leading Procurement organization!
• Effective: deliver value to the
entire organization (whatever it
means in your context)
• Efficient: use the right amount
of “resources”
• Sustainable: long-term
orientation, not just short-term

22. Source: https://www.pool4tool.com/cms/en/resources/whitepaper/procurementvalueengine
Where do you want to be?

23. Source: https://www.pool4tool.com/cms/en/resources/whitepaper/procurementvalueengine
Where do you want to be?
I bet that you want to be
there!

24. What is the
“eTransformation”
about?

25. Procurement must have a
Digital Transformation
Strategy!

26. You have to tailor the strategy
to your context…

27. Leavitt’s Diamond
Established by Professor
Harold J. Leavitt in 1965
focuses on organizational
behavior, the dynamics of
organizational change and the
interaction of four
interdependent components
found in any business: the
people, the task, the
structure and the
technology.

28. Leavitt’s Diamond
Leavitt’s theory says an
overall strategy is vital
because when change
happens in any one of the four
areas it affects the entire
system. This diamond model
might be helpful to companies
introducing new technology
systems to the workplace in a
way that lessens stress and
encourages teamwork.

29. A simplified version: “P.P.T.”
1. People
2. Process
3. Technology
(In that order!)

30. People: the key to
making a change
happen!

31. Source: dilbert.com

32. Talent and skill-set, not a new
challenge…

33. The “why” is what motivates
people! What is your “story”?

34. Source: dilbert.com

35. B2B or B2C, it is H2H!
Credit goes to Bryan Kramer for coining the expression…
Suppliers, internal customers, fellow practitioners…
are all people so business relationships are basically
human relations!
Put yourself in their shoes!  What are their
needs? Their goals/objectives/KPIs? What do
they value? “Customer” knowledge is key in the
process to ensure the right “delivery” out of the
sourcing process.
Include them!  Cross-functional teams are
key and a best practice to ensure adoption and
compliance.
Influence them!  Need standardization (when
possible), TCO/TVO…
Listen to them  Measure their satisfaction
regarding your service, feedback is always a
good thing!
For more: http://start.procurify.com/procurement-
sense-magazine/

36. The new battle front is for Procurement to be:
The customer of choice (for suppliers)
The supplier of choice (for internal customers)

37. Procurement is about selling!
Get the right approach!

38. The usual approach:
Thanks to project XXX that will last XXX
months, you will be able to save XXX amount
of time.

39. Let’s analyze that with 2
brains…

40. The usual approach:
Thanks to project XXX that will last XXX
months, you will be able to save XXX amount
of time.
Yeah, right… As usual,
promising something that
we’ll not get. I know,
“oversell” to convince may
work for some… but not
with me!
Behavioral economists have
demonstrated that a win in the future
is not estimated at its right level vs. an
immediate one. This means that you
have a tendency in change mgmt.
projects to oversell the future (gain) to
compensate with the change to be
done (pain).
https://en.wikipedia.org/wiki/Temporal_discounting

41. A better approach:
Thanks to project XXX that will last XXX months,
you will be able to save XXX amount of time.
Today, we estimate that we loose XXX amount of
time doing XXX. This is an inefficient use of our
time which has to stop.
First, it’s easier for you to identify current “waste”
than future “wins”.
Then, people relate directly to their current
situation.

42. Yeah, I know…
It is kind of saying the
same thing from
another perspective…
But if people were
logical, we would know
it!

43. Process: the key to
making a change
sticky!

44. Source: dilbert.com

45. Think outside of the box!
“The usual methods for boosting performance—
process rationalization and automation—haven’t
yielded the dramatic improvements companies need.
In particular, heavy investments in information
technology have delivered disappointing results—
largely because companies tend to use technology to
mechanize old ways of doing business. They
leave the existing processes intact and use
computers simply to speed them up.”
Harvard Business Review, Reengineering Work:
Don’t Automate, Obliterate.

46. Think outside of the box!
It also means beyond the border of your company, your suppliers have great
ideas too!

47. Clearly defined and
standardized processes,
please!
Reassessing your current way of doing things has the following benefits:
• You determine, and eventually confirm, that what you do is what you should
be doing
• You identify new ways of doing things to deliver even more value
Focusing on value-adding steps has several positive consequences:
• By defining the value that a process step adds, you define the business
case and R.O.I. which are key components to drive compliance and change
management
• Be removing steps that bring no value, you simplify your process
Streamlined process = case for change (people) + easier implementation
in a tool (technology)

48. Avoid the “1-size-fits-all”
• Different type of
spend categories,
• Different type of
stakes,
• Different type of
suppliers,
• …

49. Technology: the key
to making a change

50. Technology is great, under
certain conditions!

51. What are used to use…

52. What it looks like at work…

53. Digital Masters —
companies that use digital
technologies to drive
significantly higher levels
of profit, productivity, and
performance — do exist,
but they’re rare. […] Most
firms fall short of digital
mastery.

54. Conclusion…

55. Procurement is no longer… well
you know…

57. Source: https://www.pool4tool.com/cms/en/resources/whitepaper/procurementvalueengine
Where do you want to be?

58. The best value for money!

59. Thank you!
LinkedIn https://at.linkedin.com/in/bmaltaverne
Twitter (news) https://twitter.com/@bmaltaverne
Medium(blog) https://medium.com/@bmaltaverne

61. Summary
The expression “digital transformation” is not just a buzz-word.
Because we live in a disrupted world, Procurement has to transform
itself and become a “digital master”.
This “eTransformation” of Procurement is a MUST if Procurement
wants to increase further the value it deliver to the organization and,
therefore, survive.
The Procurement organization of the future must be effective, efficient,
and sustainable.
This requires a “global” approach to defining and executing the
“eTransformation” focusing on the three pillars that are: people,
process, and technology.