3 min read

Procurement – From Gatekeeper to Governance to Assurance  

Procurement has evolved, and so has its cross-functional teams. Modern-day procurement professionals are more than corporate gatekeepers or policy police. They’ve transitioned from gatekeepers to governance to assurance facilitators.

As assurance facilitators — they’re instrumental to the success of organizations by developing solicitations, creating organizational strategy, monitoring end-to-end processes, evaluating and collaborating with qualified suppliers, and everything in between. 

This new face of procurement is emerging as organizations adopt emerging digital tools, new process innovations, and upscaled talent pools.  

How has procurement transitioned from gatekeeping to governance to today’s modern-day assurance facilitators? And how can your procurement function utilize digital tools to help procurement evolve past gatekeeper? 

 

Procurement – Gatekeeper of Purchases

Historically, as organizations evolve and become more complex, procurement has been identified (somewhat unfairly) as a roadblock to quick and easy progress. Companies grow, and tasks that used to be innocuous and part of the day-to-day, like ordering office supplies, become a much bigger deal. 

Cross-functional departments have their own ways of completing tasks, and as companies mature, it creates an eventual mess. There are no streamlined processes or vendors, and in the worst cases, data, security, and compliance become a risk. Information is siloed, and tail spend becomes a huge source of lost revenue.  

Such inefficiencies cost organizations a considerable chunk of cash in:  

  • Missed discounts 
  • Long purchase cycles 
  • Transaction disputes 

In the past, procurement has been brought in to control purchasing and sourcing processes. When the rest of the organization can’t see procurement’s role, they view procurement as a cash cop or gatekeeper stopping them from buying things they need.  

As a result, other departments try to sidestep procurement. They only see red tape instead of understanding the nuances of compliance and security procurement brings.  

 

Procurement’s Role as Governance  

While cost cops focus on savings and making sure people adhere to policy, today’s procurement professional brings more strategic value. Procurement has evolved to be a facilitator that connects all the dots and is an informational hub for the organization. 

Procurement ensures all the checks and balances are brought together, so nothing gets lost in the process. Managing data silos between departments and facilitating conversations cross-functionally is a considerable part of procurement’s role as governance.  

The problem is getting other departments to view procurement that way.  

Managing risks in the procurement process isn’t about cost. For instance, if someone in marketing wants to buy software, they have to go through legal (contracts), budget, and data (IT and security). There are checks that need to be completed before implementation that aren’t on the radar of other departments.  

Procurement does all the checks so other teams can rest easy knowing everything is in place.  

Simply put, an engineer isn’t supposed to be responsible for purchasing or building supplier relationships. However, procurement still faces challenges proving its role to the rest of the organization.  

 

Procurement 3.0 — From Cash Cop to Assurance  

As procurement continues to evolve, there are still instances of gatekeeping, but the function has grown to be much more effective.   

The function enhances the value it brings by negotiating a lower total cost of ownership and improving interdepartmental data. Procurement sees data from the whole organization, and the highest performing procurement teams have learned to put that data to work. Breaking down these silos is crucial so that everyone has visibility into what needs to be done and why.  

For example, procurement can see what is needed in an individual office-to-office basis. It turns into savings by monitoring, recycling, reusing, and reallocating resources. Today’s procurement teams are a steward for money versus a cash cop, and the function oversees end-to-end processes throughout the entire organization, but that comes with its own set of challenges 

Cross-functional tracking for security and compliance has become procurement’s headache. Manual tracking is a barrier that procurement needs to overcome, and automated tools are the best way to do this. 

Tools give visibility to procurement and other departments. By giving departments autonomy to kick off their own requests, they no longer view procurement as a roadblock standing in the way of progress. Even better, if they can access data about vendors instantly, it helps them see other pieces of the puzzle. 

Zip is a tool that helps procurement bring this visibility to organizations. Employees can kick off their own purchasing processes instead of asking permission from procurement. They can perform keyword searches on any vendor and choose whether to use those vendors. Zip can also help with governance and inter-departmental tracking of purchases and progress.  

If you’re having problems in your organization evolving procurement from gatekeeper to strategic partner, Zip can help. Get a demo today to see what Zip can do for you. 

Written by: The Zip Team  

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