Manufacturers accelerate procurement digitalisation to boost resilience amid global disruptions

Research from Info-Tech Research Group highlights the urgency for manufacturers to adopt digital procurement solutions, integrating analytics, automation, and innovative engagement models to stay competitive and resilient in a volatile global landscape.

Organizations that neglect to digitize and streamline their procurement operations face significant risks including higher costs, diminished operational visibility, and increased susceptibility to external shocks, accord...

ing to research from Info-Tech Research Group. The global IT research and advisory firm highlights how the manufacturing sector, in particular, is under mounting pressure due to economic uncertainty, evolving trade policies, and persistent supply chain disruptions, making the need for efficient, and resilient, procurement more urgent than ever.

Shreyas Shukla, principal research director at Info-Tech, explained how procurement has transformed from a traditional cost-control role into a strategic lever for competitiveness. Manufacturers embracing procurement technologies are reportedly enhancing operational efficiency while building the resilience necessary to manage supply disruptions, inflationary pressures, and growth acceleration. The report, titled Power Resilience, Agility, and Savings With Manufacturing Procurement Technologies, identifies major barriers to modernization in manufacturing procurement such as siloed data systems, outdated legacy technology, and inconsistent tracking of suppliers, all of which hamper responsiveness to changing market conditions and undermine efforts to meet cost and sustainability targets.

Addressing these complexities, Info-Tech proposes a seven-phase framework to transition manufacturers from fragmented, manual processes to integrated, data-driven procurement systems. The roadmap emphasizes close alignment between procurement strategy and broader enterprise goals, the selection of scalable digital tools, and the use of analytics and key performance indicators to measure performance. Complementary practical tools and frameworks aid manufacturers in assessing procurement maturity, pinpointing technology gaps, and fostering long-term improvements.

These findings align with broader industry observations. For example, a piece by American Express underscores how manufacturers are increasingly leveraging digital technologies such as the Internet of Things (IoT) and advanced data analytics to boost supply chain resilience. Firms like Volvo have adopted IoT for factory operations and supply chain monitoring, yielding improvements in efficiency and enabling superior risk mitigation, inventory optimisation, and decision-making. These innovations are credited with driving revenue growth and cost reduction, further underlining the strategic importance of digitization in manufacturing.

Adding a new dimension to procurement modernization, McKinsey’s concept of Digital Supplier Days (DSDs) translates traditional supplier discovery and negotiations into efficient, remote, multi-day digital events. DSDs help companies compress weeks of procurement activities into real-time engagements, fostering quicker supplier onboarding, risk reduction, cost savings, and more agile supply chains. This approach complements the digitization push by facilitating strategic supplier relationships and helping manufacturers navigate the complexities of today’s volatile supply environments.

Further emphasizing cost efficiency, insights from Zycus reveal that procurement inefficiencies typically cost companies millions annually, with frontline procurement teams spending a majority of their time on manual, repetitive tasks. Digital procurement solutions can automate these processes, curb errors, and provide real-time insights, generating substantial operational savings while enhancing compliance. Similarly, research by Accenture highlights that companies adopting automation in procurement achieve up to 2.8 times growth in profitability and 1.7 times improvements in efficiency. Automation also enables procurement staff to focus on higher-value activities, driving innovation and faster process improvements.

McKinsey also identifies several critical themes for procurement leaders in the evolving “next normal” landscape, including the increased value of digital and analytics tools, collaborative supplier innovation, and vertical integration. With 69% of procurement leaders recognising digital and analytics as critical to future effectiveness, these strategies are poised to unlock new cost-saving opportunities, deepen supply chain transparency, and further enhance resilience against uncertainty.

In summary, industry experts converge on the view that digitizing procurement is no longer optional but foundational to manufacturing competitiveness and resilience. Through integrated digital tools, analytics, automation, and innovative engagement models like Digital Supplier Days, manufacturers can reduce costs, improve agility, and safeguard operations amid ongoing global disruptions. The frameworks and technologies outlined by Info-Tech Research Group and corroborated by multiple industry voices provide a clear path for manufacturers seeking to transform procurement into a strategic advantage that propels long-term growth and stability.

Source: Noah Wire Services