Digitising procurement could provide £100 billion boost to UK economy

Procurement is transforming by adopting big data, says CBI

The Confederation of British Industry (CBI) has said that businesses could give the UK economy a £100 billion boost to productivity, if they were to embrace technologies like cloud computing and online procurement.

There is more to digitising procurement than just moving online; there have recently been moves towards using artificial intelligence and predictive analytics, as supply chain and procurement departments turn to big data. Teams are under pressure to save money while also raising efficiency.

The CBI writes that both supply chain and procurement departments are becoming more involved in ‘executive-level' decision making. Machine learning and analytics are enabling these areas of business to make better use of big data, creating insights to improve performance.

Farida Gibbs, CEO of professional services firm Gibbs Hybrid, said: "Predictive analytics are being used to transform five key procurement areas: spend, category, supplier, compliance and performance. A data-empowered procurement function equipped with a new set of data skills enables collaboration and partnership with finance and supplier teams. Moving away from decisions based on retrospective fiscal data, real-time data is a powerful asset for procurement when it comes to spend analysis as businesses can adjust their strategy in a more agile way."

Tod Nielsen, CEO of FinancialForce, told us: "We absolutely agree with and welcome the research from the CBI. As the only customer-centric ERP, we see every day how the impact of everyday technology such as cloud computing can positively impact the bottom line for our customers and create new revenue. It's not just about introducing more efficiency, though that is a big bonus. A major focus is also creating more value for customers, helping them [to] boost competitiveness and enabling them to introduce new business and revenue models to take full advantage of economic trends, such as the shift to a service-focused economy [that] we are seeing across all industries and geographies around the world right now.

"We believe anyone who is not yet embracing cloud computing will be at risk of losing their market position and will no longer have the capability to compete with others in their industries."