Global CPO Survey shows the top priorities for the modern CPO (and Paid is working on all of them)

Deloitte have released their annual Global Chief Procurement Officer Survey which you can find on their website here.

It makes for interesting reading as ever but notably for the first time in its 10 year history ‘Reducing Cost’ is not the number one priority for CPOs, being replaced at the top by ‘Driving Operational Efficiency’.

The survey also saw massive increases in the scores for ‘Digital Transformation’ and ‘Corporate Social Responsibility’. All of this just goes to reinforce my belief that things are evolving rapidly in the procurement tech space and that Paid is the right solution, in the right place, at the right time for today’s CPOs.

I wrote about why I joined Paid as Procurement Lead here, this survey just reinforces my thinking.

Driving Operational Efficiency

The number one priority for CPOs is driving operational efficiency according to the survey. In my experience, one of the most problematic areas for CPOs in operational efficiency is the long-tail. Small, infrequent suppliers still require a level of oversight and contracting which current procurement systems deliver at a (systems and human) cost and time investment that far exceeds an appropriate level for the size of spend that is being undertaken.

Until now, the classic way to deal with this was either to try and eliminate the long-tail or to implement a solution such as purchase cards. Neither of these has succeeded in fundamentally changing the nature of the problem.

Supplier reduction has largely failed as all organisations need small one-off suppliers from time to time, hoping they will go away is not an answer.

Similarly, p-cards have not lived up to the hype as a number of suppliers won’t take them and there is a lack of oversight, data and contracting with those that do.

Paid solves this problem by making supplier onboarding, contracting and payment as efficient as possible, reducing the time it takes to onboard, and pay, a small supplier from weeks or even months to a matter of hours or days. If operational efficiency is so high on the agenda then Paid is a fantastic place to start.

Digital Transformation

In the survey, Digital Transformation saw a 20% increase as a priority from 2019. A massive jump considering that digital transformation has been on everyone’s agenda for many years. However, the pandemic seems to have accelerated the need and there are new factors such as the rise of remote working which are pushing it up the priority list.

It also reflects that digital transformation in procurement has so far largely been a frustratingly slow process and only the largest firms with the biggest budgets have been able to implement the monolithic source to pay suites that have dominated the procurement digital landscape over the last 15 years.

Things are now changing — and changing fast — with procurement start-ups springing up all over the place to disrupt the old status quo and bring cutting-edge technology to the fingertips of buyers. Paid is part of that explosion in innovation, and the Paid solution is both easy to implement and user friendly, meaning that is ideally suited as a quick win in the digital transformation journey.

Innovation

Linked to the focus on digital transformation, Innovation is a high priority for CPOs. Procurement can no longer be seen as the department that stifles and holds back innovation but instead needs to be front and centre of delivering innovation to the business. This starts at home with the service that procurement delivers to the users in the business.

Paid provides an innovative solution which end-users within enterprises love as it makes their life easier and enables innovative smaller businesses to do business with the enterprise in a much more user-friendly, fast and efficient way.

Introducing New Products and Services

It’s great to see this priority so high up in the list and procurement teams are at the centre of bringing new products or services to market. The key here is often speed. Every market is seeing an acceleration in product replacement cycles and time to market is a major factor in whether a company wins or loses.

Paid’s efficient, quick processes that can onboard innovative new suppliers in a fraction of the time that it used to take will be an advantage to any procurement team looking to help their business get to market before their competitors.

Enhancing Risk Management

Risk management remained unchanged in the CPOs’ priorities which may come as a surprise given what we have been living through over the last 18 months. However, it probably reflects the fact that risk has always been an issue that CPOs take seriously and the pandemic has just reinforced that rather than fundamentally shifting attitudes.

We find that risk is generally poorly managed the further down the supply chain that you get. The long-tail tends to be a bit of a black hole with very patchy record-keeping and a poor understanding of the businesses that occupy this space.

Paid fixes this by giving the buying organisation a clear and elegant way to check, monitor and store supplier records giving much greater visibility of what is happening in the long-tail and enabling buyers to put their hands on documents that would previously be buried in a myriad of systems.

Corporate Social Responsibility

Smaller suppliers that occupy the long-tail of major corporates deserve to be treated better than they often are (usually unintentionally, as a result of poor internal processes). Whilst there have been improvements in payment terms, this is often undermined by delays in getting the supplier and their invoice onto the system. It is no use promising to pay a supplier in 30 days if it took 60 days to get the clock started.

Not only can Paid help buyers pay to terms, Paid’s payment integrations allow suppliers to access easy and rapid payment using their invoice financing partners.

All of this goes to show that the priorities for CPOs are shifting and current solutions are not meeting these changing needs. Start-ups are springing up in the procurement tech space to respond to this gap in the market.

The priorities identified in the Deloitte survey are magnified in the long-tail and Paid is the answer to help CPOs meet those priorities.

I’m feeling very bullish on the future for Paid as we continue to roll out functionality to new big customers.