The Benefits of Procurement Technology Platforms: A Closer Look at Return on Investment
Businesses can achieve transformational efficiencies and returns on investment with procurement technology platforms. Here’s how one company pulled off its digital transformation.
Implementing procurement technology platforms can bring significant benefits to businesses, from centralizing procurement management to reducing manual errors and providing real-time insights. Up to 70% of digital transformations are deemed unsuccessful, according to Boston Consulting Group. But with strategic planning, comprehensive training, and the right tools, businesses can achieve transformational efficiencies and returns on investment.
A Successful Implementation Story
Around six years ago, my global procurement team recognized the need to implement procurement technology to significantly increase process efficiency and policy compliance. Our team proposed the case to the executive team, rationalizing the big investment with a compelling argument.
Prior to implementing Coupa, Jabil had no comprehensive view into its global spend. Despite documented corporate policies, compliance was low. We didn’t have an effective way to communicate strategic pricing, so we were leaving money on the table. We used some software tools, but they were not integrated or automated, causing complications and delays in the ordering process.
Those challenges are now a thing of the past. The efficiencies we’ve gained in the past four years are transformational:
- $6 billion under management
- 7x return on investment
- 42% on-catalog purchases
- 67% of Jabil’s 36,000 suppliers use e-invoicing
- 30% of invoices are completely touchless
Streamlining Procurement Processes
Thanks to the executive team’s support, internal teams, and supportive technology partners, we eliminated thousands of hours of manual work that is now automated.
We achieved our numbers through continuous attention and action. Getting Coupa up and running and training staff was only the first step. We were determined to make it successful and to be agile in the face of change or underwhelming results. For example, two years in, we were at 20% on-catalog purchases, but we knew we could do better.
Technology That Multiplies Adoption
We decided to implement a digital adoption technology called WalkMe, which changed our guided buying course while enhancing change management and communication. WalkMe was incredibly helpful for our teams’ participation rates as it provides a digital “tutor” that walks each trainee through the software as they complete tasks.
The addition of WalkMe was crucial to our success. We went on to curate strategic catalogs in Coupa and drive pricing visibility, which—when combined with our guided buying strategies—increased transactions going through catalogs to 42%.
The Numbers Don’t Lie
Curated catalogs give Jabil more control over spend. Buying on-catalog reduces maverick spend, increases our efficiency, and delivers cost leadership. The benefits have been felt across the organization.
The process efficiencies gained have enabled the procurement team to pivot from tactical to strategic, challenging the organization to drive for a higher ROI. Time is now spent analyzing data to identify key improvements that simply weren’t possible without the technology.
With Coupa analytics, for example, we create KPI dashboards to show on-catalog execution and drill down on transactions, analyze purchasing trends, and identify where new category strategies, change management, or guided buying practices may be required.
Where to Start with Procurement Technology Platforms
Here is a three-phase approach recommended to integrate technology into procurement processes:
- Strategic assessment — Make an honest analysis of your company’s unique strategic needs and goals. Analyze available software and develop a technology and training roadmap that fits your team and company objectives.
- Implementation — Don’t re-invent the wheel. Tap into consultants who have done this before and benefit from what they’ve learned. Find others who live and breathe procurement to support your transformation.
- Optimization — If you aren’t hitting your goals, consider other steps to improve results. Look at value-based training, staff augmentation services, and application management. Additional services and software (like our use of WalkMe) can make the difference between success and failure.
Going through this implementation, our team has extensive experience handling high-volume, complex, global implementations in some of the world’s most challenging regions. Jabil implemented Coupa in 30+ countries in dozens of languages to serve 48,000 users. And we’re happy to report we landed in that 30% of companies who deem their technical transformation a big success.