Adapt or Fall Behind: How to Reskill and Upskill Your Procurement Team Amid Rapid Change

Procurement is rapidly changing with the introduction of innovative technologies and procurement trends that will revolutionize the way organizations operate. In the coming decade, procurement teams will need to reorient their skillsets to adapt to this ever-changing landscape.

Recently, Arroyo Strategy published our Insights series “Five Bold Procurement Predictions for 2030”, in which we extrapolate on the future of procurement trends including advanced crowdsourcing, procurement technology acceleration, cognitive computing, hyper cybersecurity, and virtual organization design. As these trends continue to take hold, the role of procurement will evolve, requiring a comprehensive reskilling and upskilling effort to keep up with these sophisticated procurement predictions.

In this article, we explore what evolution may look like over the next several years. But first, we will make the case for adopting approaches that capture technology’s promise in a way that puts humans at the center, as the key enablers of success.

Maintaining a Human-Centered Approach

The rapid advancement of technology is disrupting the way procurement teams operate. Although more tasks will be automated in the future, navigating a complex business environment will still require human intuition and judgement.

To determine how teams should adapt, procurement can be broken down into two categories: strategic leadership functions informed by technology, and tactical or administrative roles that will be performed by modern technologies but managed by humans.

While a retooling of hard skills is necessary to adapt to these innovative technologies, soft skills will also need a collective rethink as technology upends the external environment, as well as the internal one. Upskilling will be required both for strategic leaders in making use of the information these innovative technologies produce, and those who will need to manage technology that is taking over some of their former tasks. In this case, digital upskilling (learning new technologies to modernize businesses), is the most important. Skills such as relationship management, empathy, patience, conflict resolution, and creativity will also remain competencies critical to navigating the often-complex social network of organizations, both large and small.

For instance, maintaining an emphasis on inclusive procurement strategies to proactively manage supplier relationships will create long-term, strategic partnerships that can withstand the storm of market uncertainty and changing needs. Internally, managing cross-functional and intra-team relationships is critical both for cohesiveness and for achieving the mutual objectives of groups within a company, aimed towards a common goal.

Five Human-Centered Procurement Trends

Arroyo Strategy recommends that procurement organizations concentrate their reskilling and upskilling efforts on five bold procurement trends that are likely to become prevalent within this decade. Their ability to harness these trends for competitive advantage, while also managing the associated risks, will assuredly depend on the humans at the controls, specifically their ability to improve technical expertise, solve problems, and engage in strategic thinking. A human-centered approach to procurement is more important than ever to create value for the organizations in which procurement serves.

Advanced crowdsourcing

People and organizations are now more connected than ever before, and this has enabled the growth of crowdsourcing for individual and social causes. In the future, procurement organizations will leverage this to receive bids or proposals from a rapidly evolving body of web-savvy suppliers.

Procurement professionals can prepare for inevitable changes in the field by:

• Reviewing current sourcing practices
• Keeping up with developments in mainstream sourcing
• Considering what adjustments can be implemented in their practice
• Make updates when they make sense

Procurement technology acceleration

The majority of mid- to large-size organizations report using e-procurement and e-sourcing software, and we predict use will grow exponentially in the coming years. Artificial intelligence (AI), machine learning (ML), and predictive analytics will impact human efforts for most administrative tasks. These seismic shifts in procurement technology stack will significantly impact how teams conduct business. IT executives must quickly begin investing in the technologies and systems that will educate their staff for the new standards anticipated to be widespread within ten years or less. They will need to test and evaluate the innovative technologies so procurement experts may become familiar with them and how they will fit into an organization, while creating an internal culture that encourages testing and adopting innovation.

Cognitive computing

With cognitive systems at work, procurement teams can see significant workflow improvements. More specifically, we can expect most administrative tasks to be automated (intake, strategy recommendations, RFP development and administration, evaluation and scoring, and scenario analysis). Procurement leaders will need to focus their training shift towards providing teams with the tools to build strategic skill sets, such as relationship Procurement organizations will also need to conduct assessments of their sourcing processes and develop comprehensive training plans that utilize next-gen technology systems and explore areas to apply AI and ML technologies.

Hyper cybersecurity

As more business activities become digitized and automated, companies will need to focus on cyber security to protect an increasingly target-rich environment from sophisticated hackers, through finding optimal talent, products, and services. Arroyo Strategy predicts that cyber security spend will increase by 30 percent in 2030. It is critical that procurement leaders train their teams to implement procurement practices with a focus on cybersecurity-related category expertise.

Virtual organizational design

By 2030, core procurement organizations will be expected to centralize processes, manage data analytics, and drive business strategy. Procurement firms will first need to assess their organizations’ current designs and determine what changes will be required to build more responsive, adaptable sourcing teams. To maximize optimization, they will need to develop a plan to restructure, reskill, and upskill their staff, seeding contracted generalists in the department, as necessary. Ultimately, procurement organizations will be smaller and more agile, with a heavy focus on relationship building and business strategy.

The fast pace of technological progress is changing how procurement teams operate now and over the next several years. To take advantage of these advancements and remain innovative and competitive, companies must adjust and improve their skill sets. They should focus on developing technical proficiency, problem-solving abilities, and strategic thinking while upholding a human-centered approach as their North Star. By doing so, procurement teams can adapt to the evolving environment and generate greater value for their organizations.