Subscribe To Newsletter Sourcing and Procurement 5 Trends in Procurement for Manufacturing industry In the professional sphere, it is critical for each one of us to improve our performance at work and thus make a significant impact to the companies that we belong to. Hence, it is important to reflect on the learnings from the years gone by and resolve to strengthen our capabilities and capacities in the years ahead. Let us take a look at five of the most influencing procurement and manufacturing trends this year and beyond. Risk Management In Procurement, risks are difficult to forecast and they cannot be eliminated completely. Manufacturers who are trustworthy and reliable can help reduce risk interference and make it easier to expect and adjust to any situation that may arise. The economy is ever changing and it is important for manufacturing companies to be ahead when it comes to risk management. Risk Management helps to mitigate the risk of supply disruption. For ensuring the continuity of the supply, organizations have included some databases, researches to improve upon the supplier information through subscription and otherwise. This also happens to be a key parameter of the Category Manager in a manufacturing company. Another way that companies can reduce risk and ambiguity is by ensuring supply chain transparency. When all these aspects come together with perfect partnership, it reduces risk disruption. Having a definitive risk management strategy which could include innovation in the industry, manufacturers are also always prepared and ready with risk management to flourish and survive. Talent procurement With new and emerging technologies, it is difficult to find talent for the required skillsets. This proves to be a challenge as most manufacturers rely heavily on technology and its usage and implementation on the job. Hiring fresh talent or upskilling of the existing resources is inevitable. Organizations are already investing to upskill their programs. Alternatively, they are even engaging Consultants through skill aggregators. For instance, Up work similar to any taxi operators - they are not the owners of the taxis that provide service to you. They just organize different taxi operators to provide service under their name and work on building their brand, getting more market share, and providing on demand taxi service to the ultimate users. This in turn brings more business to the partners, i.e. the taxi operators. Involving industry aggregators also helps to have a flexible plan based on seasonal variations along with the billing. The responsibility of skill management lies with the outsourced organization. Operational Cost Reduction Any supplier with whom a company has a contract with can be checked and measured periodically for their performance, even in real time. Deviations are then discussed with the supplier for improvements. Analytics is also used to predict the possible deviations to have the required supply. Alternate transaction methodologies for procurement, sending the request for periodic delivery and invoicing are available along with supply chain financing to ensure that we have the best pricing for procurement. User driven Procurement Ordering Procurement has connected with various e-market places to ensure the delivery of product and services on demand. The process and user interface have gone through radical change with MI, AI/ML, and usage of NLP (Natural Language Processing), where the requestors can order with great ease. The speed of the procurement process has increased leading to shorter fulfilment cycle time in comparison with what it was few years ago. Adoption of technology has been one of the key aspects. Secondly, the participation of the user departments has increased with the Procurement Teams, so that the requirements and supplier selection meets all the parameters. This has been possible with collaborative tools such as e-Sourcing tools that enable evaluation across multiple locations. Localization of Suppliers Adoption of local suppliers is gaining prominence. Organizations have started to venture and look at the local suppliers - specially suppliers under Small or Medium Scale and even some regional groups (such as local tribes, etc.). The idea is to encourage diversity of thought and participation. In Conclusion As procurement professionals, in order to be successful, we must deliver greater value to our clients through innovative solutions, domain expertise, harnessing new-age digital technologies such as AI (Artificial Intelligence), ML (Machine learning), RPA (Robotic Process Automation), etc. It will help us to navigate through the ever-changing scene of the market, ensuring that we stay on top of all the latest procurement and manufacturing trends.