Procurement - digital supplier interactions
More than a year into the COVID-19 pandemic, corporate buyers and procurement professionals, in general agree that digital and remote interactions are here to stay according to research and analysis conducted by McKinsey & Company.
With most companies forced to adopt remote working practices through 2020 – some have since decided not to return to the office at all, allocating their employees to work from home – and with this, interactions that were once in-person are now mostly carried out remotely and digitally.
According to the McKinsey & Company research, buyers are choosing omnichannel interactions even if they work for an organisation that has returned to an office environment. These remote practices seem destined to stay and have transcended the original requirement during the pandemic. This change of behaviour will undoubtedly shape how people do business globally now and in the future.
The key points of the research were:
- More than two-thirds of the procurement professionals that took part in the research answered that they prefer to make orders and finish their negotiations through digital services, with and without human interactions. So remote human interaction and self-service tools are the main preference. And less than one-third said that they still opt to order through traditional human interactions only.
- 20% said that they have the intention to spend more than half a million dollars through remote interactions and digital platforms this year, and over 11% will spend more than a million.
Can digital and remote interactions be more productive than traditional methods?
A sentiment that grew for many people during the past year, and not just in procurement, is that the digital solutions adopted during the period were actually more effective than more traditional methods with 83% of the corporate buyers that took part in the research agreeing with this.
Also, eight out of ten corporate buyers believe that digital tools, e-commerce platforms and technology for buying and selling are more successful when it comes to prospecting and maintaining new suppliers when compared to face-to-face only interactions with the latter being more expensive and time-consuming.
Companies also learned that they can now develop deeper connections with suppliers when interacting digitally. Suppliers find it easier to update and access their data on company portals and digital communication makes conversing and collaborating more effective.
There's no denying that technology can help improve the daily routine of procurement professionals, especially when it comes to the gain in data, risk management, pricing transparency and communication, and the legacy of the digital and remote transformation changes made during 2020 are looking like they will be here for some time yet.
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