As uncertainty around the global economic outlook continues, many business leaders are considering how they can best prepare their organizations for a potential downturn. Many executives are looking to build resiliency against external factors like supply-chain disruption, increase visibility into spending and budgetary considerations, and improve agility to adapt as conditions change.
One key goal for CIOs and IT decision-makers must be tackling the fragmentation in supply chains and procurement processes that fosters a lack of agility and visibility. The natural answer to fragmentation is orchestration. When leveraged with related elements such as automation, orchestration enables organizations to break down siloed workflows and create bridges between applications and users to eliminate complexities. When used effectively, orchestration can be vital in delivering agility, improving user experience, and managing budgetary constraints.
Conversely, companies that don’t digitize or automate their supply chain and procurement workflows risk a lack of visibility and control that can cause disruption, exacerbate delays, and leave organizations without a means to adapt. In uncertain times, CIOs must use every lever at their disposal to avoid falling behind.
The vital role of orchestration
When it comes to procurement, fragmentation is typically due to reliance on processes that are manual and/or siloed. This deters collaboration across the organization, can result in uncontrolled maverick spend, and prevents procurement teams from having visibility into Spend Under Management (or SUM). It also interferes with allowing the swift, agile workflows that modern business users require and makes meeting compliance mandates and similar regulations more challenging. Finally, it can lead to a damaged user experience by creating friction between business users and the procurement team. These problems worsen as a company becomes larger and more decentralized, driving conflict between the desire for agility and the need for compliance and control.
Orchestration combats these challenges by digitizing or automating procurement and supply-chain workflows across systems. It enables unified collaboration and engagement between business users, suppliers, and other stakeholders. It also ensures these business workflows are reliable. Without the proper orchestration, a bad workflow will result in bad data and, in turn, poor business decisions. Conversely, optimized workflows will produce high-quality data from user actions and integrated systems; they make it easy for business users to make well-informed decisions and drive significant business impact.
Orchestrated procurement workflows reduce cycle times through automation and streamline how a company onboards and engages with suppliers. They increase visibility for finance teams into spending and commitments. Orchestrated workflows also help organizations scale operations to meet legal, compliance, finance, and other regulatory requirements more rapidly.
To implement orchestration into procurement and supply-chain workflows, CIOs and IT decision-makers should look into three notable areas for improvement:
1. Data entry, access, and visibility across business applications.
2. Procurement and vendor engagement across departments.
3. The overall supply-chain workflow.
Orchestrating data entry, access, and visibility across business applications
The most direct opportunity for orchestration is to employ workflows to create a single, unified entry point for stakeholders to engage with procurement. This is important for several reasons: First, organizations may have multiple, fragmented systems and applications that touch procurement – and therefore require a “single point of entry” for engagement. Additionally, modern procurement isn’t always a linear process. There may be varying sub-processes that constitute an engagement for a given procurement requirement. Users need visibility into the statuses of these sub-processes and their execution. Finally, different parts of the larger procurement process may be interdependent (such as contract finalization before placing an order) and lack a unified view. From a user perspective, these interdependent parts can result in fragmented context, application switching, and a negative user experience.
Orchestrating procurement and vendor engagement across departments
Introducing orchestration into procurement processes and vendor engagement can unlock significant benefits. As referenced earlier, there are different sub-processes involved in managing procurement and supply chains. Orchestrated workflows that are designed based on an organization’s needs can be used to gain control (and visibility into condition and state) across these differing fragmented processes. Orchestration allows organizations that have frequent process changes to implement a self-service approach easily, replacing the need for time-consuming change requests. By using process orchestration, they can digitize and automate spend related to complex service requisitions and specialized products – spending that otherwise falls out of band and gets handled manually.
Orchestrating the overall supply-chain workflow
The greatest opportunity for CIOs is to orchestrate the broader supply chain and procurement workflows. Businesses that rely on a wide range and high volume of solutions encounter challenges in terms of enabling interaction between them, leading to gaps in collaboration and context. Orchestration can help companies establish a composable framework of their underlying applications via integration. For instance, when it comes to managing supplier data, these workflows can help provide a centralized repository for storing and accessing supplier information. Orchestration can then help de-duplicate this data to ensure the relevant information only shows up once for each supplier and ensure that the necessary information is readily available where needed – either within other enterprise applications or for review by supplier intake and approval teams – to help with supplier onboarding. Taken to the logical extreme, this workflow orchestration can be used to combat supply-chain fraud, promote partner collaboration, and more.
When looking to enhance organizational workflows and drive efficiencies, CIOs and IT leaders should first look to maximize their existing systems to unlock greater resiliency, visibility, and agility. Introducing orchestrated workflows facilitates these improvements in existing systems, leading to stronger, more nimble organizations that can view and control supply-chain activity for better planning and management. CIOs can dramatically improve the procurement experience for business users and stakeholders, helping corral maverick spend and make more informed spend decisions. Most importantly, orchestration can position a company to achieve business growth and demonstrate agility in whatever market conditions it faces.