| | NOVEMBER 20218CIOReviewTHE MODERN PROCUREMENT PARTNERSHIPOver the past 20 years, everything has changed in the way people think about buying goods and services. Digital transformation, once a leading-edge business notion, is now synonymous with the modern online marketplace. With this shift in technology and information-enabled buying, there has never been a more important time for information technology to be a strategic partner to procurement.In order to understand why the relationship between information technology and procurement is so valuable, it's first necessary to define the modern procurement function. While each organization will have its own mission, vision, and goals for the procurement function that are specific to its individual needs there are some common principles to the practice of procurement. Like the first principles of physics in science, these procurement principles help practitioners define the way we think about our impact to the business, and serve as a guiding light when establishing all policies, practices, and systems.These principles are:1. Locality. For a great user experience in buying, technology must meet the users where they are. It must offer an intuitive, consumer-like experience, presenting needed products and services from suppliers within timely geographic access.2. Causality. Business need drives procurement activity. When a user needs to obtain a good or service, they are doing so to solve a business problem. Procurement technology exists to operate as a service to the user and an extension of their team to quickly and reliably meet that need.3. Invariance. When a user follows a curated buying path, the user must receive the invisible benefits of procurement practices: reliable sources of supply from suppliers that reflect shared company values, offering goods at market competitive rates, with timely delivery in line with modern expectations.4. Asymmetry. A procurement method is only as valuable as its usage allows. If the 'better, faster, cheaper' manner to obtain goods and services is the compliant path, then compliant buying is also the easiest. Good experiences drive good policy behaviors, which in turn drive more good experiences in buying. Curated and non-curated buying channels offer different speed, precision, and control.5. Probability. Very few questions rise to the level of enterprise procurement that have a definitive binary answer. Most issues in reliable, responsible, cost-effect supply come with a range of probabilities for their likelihood and severity. Procurement must operate in a steady state of balance, neither being so risk averse to add unnecessary cost and bureaucracy, nor so cavalier that disruptions can undermine the ability of the business to meet its commitments.From these five principles, every procurement strategy and approach can be derived, whether that is how to manage commodity buying, how to execute a supplier relationship management strategy, how deliver contract lifecycle management, where to prioritize environmental and social By Phil Morgan, Sr. Director, Head of Global Strategic Sourcing and Procurement Operations, Electronic ArtsPhil MorganIN MY OPINION
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