DIGITAL LAB: MASTERING THE FUTURE OF PROCUREMENT

Procurement as supplier of business insights and foresights

More than 40 CPOs and procurement experts from Fortune 500 companies across Europe followed Roland Berger's invitation to the first Digital Procurement Lab in Berlin in November. At the consulting firm's innovation hub, Spielfeld, they had the opportunity to debate the future of procurement, do a spot of networking and hear about innovative digital solutions in the Startup Pitch Arena. Christian Lindner, Chairman of the Free Democratic Party, gave the keynote speech in which he expressed his view of how things stand with digitalization in Germany.

The leader of Germany's liberals believes that the reason why the country has so far failed to set itself on the right road to digitalization is largely down to a lack of understanding. "Policymakers think of digitalization as a kind of technical innovation, something like the LCD screen that came after the cathode-ray tube in our TV sets," he said. Yet Germany with its highly competitive industry has enormous potential to profit from digitalization, according to Lindner. But it's going to take a paradigm shift: "We need to get off the defensive and stop fighting against something and start fighting with all our might for something instead."

Procurement: efficiency or value creation?

A panel of high-profile delegates chaired by Roland Berger Partner Sven Marlinghaus then went on to talk about the challenges digitalization holds for procurement. The debate centered on whether panel members viewed themselves within their future business model more in the role of an efficient machine or a value creator. Participants came to the conclusion that procurement ultimately has to be both. Traditional procurement as we know it is not going tosurvive into the future . Operational and tactical activities will be almost completely automated. Strategic procurement and its value-creating activities will need the support of new artificial intelligence and analytical tools going forward.

In a joint presentation, Detlef Schultz , Chairman of the Board of Directors at Vodafone Procurement Company, and Michael Pleuger, Senior Partner at Roland Berger, outlined their vision of the future: "Procurement is the place where untold quantities of valuable data from inside and outside the company come together – it's like the spider sitting in the middle of the web. And procurement organizations need to exploit the advantage this gives them to position themselves as suppliers of business insights and foresights." The key, said Schultz, is to completely realign the function in terms of its capabilities, its culture and its use of digital tools. With precisely this in mind, Roland Berger is currently working with leading companies on the development of the collaborative AI-based platform called Prodigi.

At the Pitch Arena, eight startups from the procurement scene showcased what they are doing to master the digital future. The team from Berlin company Sennder ultimately won the battle of the pitches. Sennder is a startup that brings the needs of retailers and shipping companies together through a proprietary software platform.