Digitization of Procurement is a NECCESITY & not the Luxury

Mr. Suhrid Shah

CEO – MavenVista Technologies
 2008 Melt Down

Did anyone Predict this?

This is the Current Situation!

Can it Happen again?

 IMPACT ON CORPORATIONS

REDUCTION OF SALES

REDUCTION OF PROFITS
Need of the hour…
Cost Reduction…

Imperative to build & maintain

competitive edge

Improve & maintain bottom-line

Survive
Long Term: Technological Innovation Short to Mid Term:
Enhance efficiency in Supply Chain

Substitute cost effective material

Improve Production Process

Any in-efficiency in Procurement process severely

impacts the Primary Cost which has major constituent
as Material and Supplies
What impacts the efficiency of Procurement Function?

Vendor Discovery Risk Management Requirement Negotiations Contract

& Onboarding Management Management

Supplier Relationship Supplier Evaluation Transparency Security Competent

Management Human Resources
Let us look at how these functions are managed?
Traditional Procurement

❑ Huge Time spent on transactional activities.

❑ Human intervention on all data points.

❑ Individual perception based judgements.

❑ Decisions on gut feel.

❑ Large pool of resources to collect data.

❑ Excel driven analytics.

❑ Large pool of documents management.

❑ Multiple storage points of data.

❑ Extensive Internal & external Coordination.

What it results in to?

❑ Maverick Buying.

❑ Lack of visibility of spend.

❑ Questionable purity of data.

❑ Limited risk mitigation of knowledge.

❑ Very little time for Strategic Thinking.

❑ Delays to access desired information in time

❑ Audit Challenges.

❑ Highly stressful environment.

❑ Lack of Clarity.
 RESULT
High Costs Chaos
 Impact on profit

Increase in
Major Challenges in Procurement Implications
Cost

Information Gaps Sub optimum buying decision 2-22%

Higher cost on emergency

Communication Gaps 1-3%
purchases
Huge time spent on High cost of Human
0.5-2%
administration Resources

Absence of analysis of historical Adverse impact on

1-5%
data Negotiations

Limited New Source Additions Less competitive environment 2-22%

PROFIT
What is Required?

Compliance

Availability of
Analytics for efficient
decisions

Ease of Transactions
Welcome to Digital Procurement!
 What is the Outcome of Digitized Procurement?

Trail of Digitization of
Online Repository Automatic Online Evaluation
Requirements and Documents
of Supplier Determination of of Technical
Triggers to pertaining to
Information Supplier Risks Capabilities
prioritize functions Transactions

Auto Order
Online linkages to Automation of
Audit trail of all creation based on Instant access to
market Administrative
decisions approved relevant Analytics
information tasks
decision

Trail of Platform for

Track of every line
Automatic rating Communications Vendor
item of Order for
of suppliers for Techno- Relationship
delivery & quality
commercial clarity Management
What it results into?

Supplier Satisfaction

Integration of Information

24*7*365 Data Access

Audit Trail of Decisions

Central Repository

Validation of SOP

Dynamic & Relevant Analytics

Real-Time Visibility
 US
Management Procurement Process
Brazil
China
India
 Benefits Of Digitization of Procurement

LOWER TRANSACTION COST HIGHER COMPLIANCE LEVEL

SHORTER ORDER CYCLE TIME LOWER INVENTORIES

LOWER PRICES
 Who can benefit
From Procurement Digitization?

Organizations
of ALL size and industry
can benefit from
Procurement Digitization.
VIEWS OF GLOBAL CONSULTING FIRMS

Digital technologies pave the way for

procurement teams to play a larger
strategic role accelerating business
innovation.

Research conducted by Procurement

Leaders shows that a fully automated
procurement function could save the
Global 5000 up to $86 billion annually.
Source: https://www.bain.com/insights/digital-procurement-the-benefits-go-far-beyond-efficiency/
VIEWS OF GLOBAL CONSULTING FIRMS

As businesses race to adapt to a new modus

operandi in the face of disruptive technology,
procurement leaders are using digital tools to
capture both bottom-line efficiency and top-line
growth.

Source: https://www.atkearney.com/procurement/article?/a/procurement-riding-the-transformative-digital-wave
According to Deloitte's Global Chief Procurement Officer Survey for 2018, 78% of procurement
leaders said their number one priority was to reduce costs.

A study published by the Institute for Supply Management which says firms that use reverse
auctions receive 20-30 times more bids compared to traditional RFP methods and experience
average price reductions between 12% and 24%.

Organizations across the world have benefitted immensely

Increasing spend under management (SUM) can result in a 6% to 12% savings on each
additional dollar, according to CPO Rising’s 2019 research report.

The benefit
According to 2018 as reflectedInsight
Procurement in certain
Report,cases goes as
Organizations high
that haveas one
highmain
procurement department and centralized purchasing
30% reduction processes may struggle to maintain
in costs
control over spend if they are operating with manual methods or inefficient systems. One of
the ways this can happen is if the procurement department does not have a proper tool or
method for managing spend against their indirect spend budgets.

Using technology reduces your supply chain risks, improve process efficiency in terms of How
you're engaging with your supplier base and for an additional way to get value out of
blockchain initiatives that you might already have. - David Post, MD - Blockchain Ventures at
IBM.
Deloitte found that 88% people believe that automation and robotics
will impact procurement within five years. AI is expected to
extensively support decisions

But, organizations need to walk before they run.

If your data is unreliable, fragmented and incomplete, fixing that is

priority No. 1. Analyzing it is priority No. 2. Somewhere down the list of
priorities is feeding it to machines for novel insights. - Forbes
 Need Identification

Key criteria for selecting the

Right Technology Partner

Get management
alignment

Set up core team

Beta Via P.O.C.

Value Communication to
the stakeholders

Measure & Fine tune the

process after POC

Golden Steps for digitization Future steps & strategical

plan.
Digitization Journey

Pre – Digitization During Digitization Post Digitization

1. Need Identification 5. Beta Via P.O.C. 8. Future steps & strategical
plan

(i) Have you done it right?

2. Key criteria for selecting the 6. Value Communication to
(ii) How to leverage?
Right Technology Partner the stakeholders
(iii) What Next?

3. Get management 7. Measure & Fine tune the

alignment process after POC

(i)Are you doing it right?

4. Set up core team
(ii) Are you happy with
outcome against predefined
success parameters?
Key criteria for selecting the Right Technology Partner

❑ Align with someone who understands your pain areas

❑ Don’t fall for Perception – Go for Reality Check

❑ Determine sustainability of the solution partner for ever evolving future landscape

❑ Ensure Best Security Measures

❑ Evaluate Adoptability
OUR CLIENTS & TESTIMONIALS

Cement FMCG

Chemicals Pharma

Textiles Automotive

BFSI OTHERS

Generating significant savings through Instrumental in achieving 60% of process time

Successfully integrated VENDX with SAP ECC 6.0 savings
superior price discovery
Mr. Gagan Bharadwaj, Vice President Procurement VP Debajit Bhattacharyya, Havmor Mr. K. R Sekhar, VP – Procurement & Logistics,
and Logistics, Intas Pharmaceuticals Bayer Crop Science Ltd

Conducted more than 500 Strategic Auction

Seamlessly Integrated with ERP System Events thru VENDX Successful Integration of PR to PO
Mr. Sudhakar Shetty, General Manager,
Mr. Rajat Passi, Head – Materials, Arvind Ltd Mr. Yateendra Chaturvedi- CIO, Ruchi Soya Ltd
Aarti Industries Ltd.

Transparency, Standardization & Simplication Complete Visibility of sourcing Process

in Buying Process On an Average 20% Savings by the Auction
Mr. Satindra Kaur, General Manager- Procurement, conducted by MavenVista Team
Mr. Suresh Patel, General Manager Purchase, Jubilant LifeSciences Ltd
Zydus Cadila Ltd Mr. Dilan Meegoda- Asst Manager Supply Chain,
Brandix
 (A Product of MavenVista Technologies Pvt. Ltd.)

To Know More About Digitization of Procurement: https://youtu.be/OxJXE9E5954

https://mavenvista.com/
rahul@mavenvista.com
+91-9033030058