It may not come as too much of a surprise that the global lockdown has put incredible strain on supply chains and great scrutiny on sourcing and procurement methods. For a start, we saw a huge shift to organizations delivering tasks and sourcing and purchasing remotely. For those lacking the structures to support this, their inability to purchase goods and services temporarily affected many aspects of their operations. They joined the ranks of businesses seeking relevant supplies urgently – and often manually.
The stories of weeks of phone calls to try and source a particular product are all too familiar for many. For those organizations with established supply chains, there was an added concern of ensuring continued supply. Questions such as how this would be uninterrupted also came to the forefront, highlighting the crucial role of procurement strategies. Then these companies had to make sure any new pandemic-related policies were associated with the supplier records. These records needed to be transparently available to anyone who needed them.
Key Takeaways
- The global lockdown strained supply chains and highlighted the importance of effective procurement methods.
- Organizations faced challenges in sourcing due to remote operations and the urgent need for essential supplies.
- Businesses must adopt flexible procurement strategies and technologies to manage supply chain disruptions efficiently.
- Fast and compliant onboarding of new suppliers is crucial to mitigate risks during procurement processes.
- Streamlined technology supports procurement teams in making informed decisions and managing spend effectively.
Rush to fill
The sudden need to increase sourcing and purchase of specific categories of items also put pressure on several sectors. PPE was the main – but not the only – category. For example, not all organizations were experienced in having staff working from home. Thus, there was pressure to source IT equipment to support employees in doing this. Not to mention the underlying need to ensure that they were promptly trained to use the technology effectively as part of a broader procurement strategy.
Supply chains were also affected by pivoting organizations that suddenly required new products and services while reducing their demand from their traditional channels. While food retailers faced bigger demand, most of the hospitality sector had to put orders on hold. So did whole swathes of the economy while lockdown was at its most severe.
The need to have a strong and stable supply chain has never been more apparent. Coupled with the need for obtaining the best value in sourcing, the reliability of supply has become crucial. Additionally, the consideration of more localized supply chains with electronic sourcing solutions and supplier management facilitating this process has become the new normal. This highlights the evolving role of procurement in modern business practices.
Finding the right technology
So, as lockdown restrictions flex, businesses such as restaurants face unique challenges. They need to hold orders when there is a forced closure. Then they have to switch orders back on when allowed to reopen.
This means that when procurement teams are planning, it is all about flexibility right now. With a good network of suppliers and the right technology to support sourcing and purchasing, it is possible to react to the unexpected. Agility is key. A key component to that agility is having the right supporting technology that works no matter where a team is working, and using it with ease. If it isn’t intuitive or the team doesn’t understand how to utilize technology, it won’t be as effective.
For sourcing and procurement teams, the ability to onboard new suppliers quickly but still mitigate any potential risks of fraud is critical to that flexibility. Processes also need to be in place that support fast, compliant onboarding. This minimizes the risk that comes with rapidly adopting a new supplier.
How to get it done
And no matter whether a team is working in the office or at home, employees need to be supported. They need to get the supplies they need to do their jobs from approved suppliers while following company policies.
Technology has been one of the foundations that has helped businesses to continue to operate during this crisis.
When technology is applied in a simple, streamlined way, it helps procurement and finance teams make informed decisions. They can control a greater portion of their spend, which, of course, leads to savings, better supplier relationships, and a reduction in risk. Emphasizing effective procurement processes is crucial to achieving these benefits.
