Purchasing in 2024: efficiency and sustainability as the new norm

Procurement functions are more than ever at a busy crossroads today. Which organisation is not expected to manage both working capital and human capital as efficiently as possible? The role of purchasers or the administration responsible for procurement is becoming increasingly heavy: there is a need to work cheaper, to procure cheaper, and the list of requirements, for example in terms of sustainability, is getting longer.

Therefore, there is an increasing need to work at a strategic level and to embed formal procurement processes within organisations. This way, the entire organisation contributes to the operational ordering processes, and the procurement function can focus on the tasks that truly add value: implementing procurement policy and striving for successful, sustainable collaborations with suppliers. And this, in turn, creates a positive impact on the business, where the real value ultimately lies. In short: streamlined procurement processes and increased insight ultimately allow organisations to save and benefit.

4 developments that accelerate the transformation within procurement:

1. Changing role of procurement (and procurement software)
   In 2024, the procurement function underwent a remarkable transformation. Where it used to primarily revolve around placing orders and managing suppliers, procurement and the supporting software now play a much broader and more strategic role within organisations. They are crucial in achieving cost savings and business objectives, optimizing operational processes, and promoting socially responsible procurement and innovations.
2. Focus on real spend, efficiency, and cost savings
   More and more organisations want to accurately monitor and manage their spending to gain insights into where and how their money is being spent. This insight is essential for identifying saving opportunities, avoiding unnecessary expenditures, and ensuring that every purchase contributes to the strategic objectives of the organisation. Saving costs, a direct result of effective spend control, goes beyond simply lowering prices of goods or services. It involves optimizing procurement processes, improving efficiency, reducing waste, and ensuring long-term value for the organisation. Purchasers and the software they use play a crucial role in this.
3. Sustainability and socially responsible procurement (SRP)
   There is a growing emphasis on sustainability and social responsibility within the procurement process. Organisations increasingly recognise the impact of their procurement decisions on people, the environment, and society and therefore try to make responsible choices in the supply chain: working with suppliers who meet sustainability standards, ensuring fair working conditions, paying fairly, reducing environmental impact, being socially and ethically responsible, ...
4. Technological innovations as a catalyst
   The procurement function is undergoing a digital transformation, utilizing developments and technologies such as artificial intelligence (AI), machine learning, and standards like PEPPOL to automate processes, improve data analysis, and secure transactions. These technologies enable organisations to work more efficiently, make better data-driven decisions, and increase transparency in the supply chain. Today, purchasers and the software and technologies used really act as a catalyst for business improvements. If the procurement process operates efficiently, it directly impacts business operations and how services or products are delivered.

It is clear that the purchasing function within companies is transforming and increasingly fulfilling a crucial strategic role.  With advanced software and technologies, buyers gain control over their processes, can map their actual spending, promote operational efficiencies, and implement cost optimisations. A must for anyone who wants to take charge!