Procurement 2021: Be prepared and expect the unexpected!

Trends announced for 2020 fell through as early as the end of January. Burning political and customs wars as well as common procurement issues have been replaced by the crisis caused by the COVID 19 virus epidemic. No one could have predicted that a small, only microscopically visible virus would cause a global economic crisis, bigger than it was in 2009. It has never happened in history that the whole world was “out of order” at the same time.

As providers of procurement solutions, we monitored and analyzed events, participated in native and foreign meetings, and talked to our associates.

Fortunately, procurement has advanced significantly over the past decade, evolving as a strategic function that concentrates on risk management, relationships with suppliers that result in long-term win-win cooperation. Those who embraced the new methods of work were more willing to respond to challenges.

New ways of working are a priority!

Many of the things we took for granted, such as team meetings, supplier negotiations, and other face-to-face interactions, became impossible overnight. But a solution was found – they moved to the virtual world.

Remote working made unprepared procurement less efficient, and it was most felt by those companies that did not introduce digital communication.

The crisis in procurement, however, hit the supply chain the hardest, which at some points was completely interrupted.

Our customers pointed out that the most difficult moment for them was the earthquake in Zagreb, which occurred in the midst of a lock down, and as two key items to meet procurement requirements, they singled out supplier relationships and the speed they insured by using digital tools.

With Ensolva, we monitored the needs and requirements of users, adapted to new conditions and developed functionalities that are already indispensable.

Procurement in the new normal

In order to have things under control, procurement departments need to transform the way they work and improve collaboration with internal and external stakeholders. Adopting an agile operational model will enhance procurement functions to be ready to respond to sudden challenges. Agile methods need to be applied to strategic issues: key procurement categories, negotiations, and contract monitoring.

New ways of working focus on data analysis and supplier skills to nurture business partnerships with suppliers and internal relationships – due to instability in the supply chain and demand.

Based on conferences and webinars, conversations with procurement leaders, and our collaboration with business organizations, we have singled out five tips that will help suppliers adjust and function in the new normal.

It is ungrateful to give forecasts, but the fact is that after 2020 there is no going back! If you haven’t already adjusted your procurement to the “new normal”, do it urgently!

• Expect the unexpected!

It is not known when the epidemic will end, whether the virus will mutate, perhaps with warmer days and with a vaccine it will disappear completely. Be prepared for anything!

• Communicate, listen, and build relationships!

A reliable business partnership is the foundation of success! Be a partner to your sales, marketing, finance, and suppliers. Design communication channels in which you will receive and send all the necessary information.

• Procurement will play a crucial role in recovering from the crisis!

Reducing costs, unstable demands, reducing the risk of your supply chain… Procurement will play an important role!

• Secure the supply chain!

It’s time for a thorough supply chain risk assessment and management! Contact your key suppliers, study their associates, get informed and find an alternative!

• Invest!

A reliable business partner and an adequate technological solution to the procurement bring relief and give it the wind at its back.

Always, but always, think positively, keep a smile, and boldly step forward to meet new challenges with carefully selected business partners!

Merry Christmas and a healthy and successful New Year!