No Match Found
of companies use both S2C and P2P solutions
of highly digitalised companies succeed with value creation thanks to procurement data
of companies name cost reduction as one of their top three strategic priorities
of companies are interested in implementing ESG/CSR digital solutions
More than 800 procurement and supply professionals in 64 countries across 17 industries participated in PwC’s most recent survey on the digital transformation of procurement. In this study, we discover the current and future state of procurement digitalisation, including key investment areas, digital roadmaps, key success factors for transformation, best practices, and much more.
Supply of goods and services has become increasingly challenging over the past few years, making the business of procurement increasingly tough — with a variety of competing forces at play. Global supply shortages. Price increases. Inflation. Health crises. Clearly, the list of challenges is long, but so too is the list of opportunities to earn trust and create value.
With innovative mindsets and the right technologies, procurement professionals are driving toward delivering transformation with the right business outcomes. Chief procurement officers (CPOs) continue to demonstrate a sense of purpose, focusing their roadmap on source-to-pay digitalisation as well as a shift to sustainable development with innovative use cases of ESG and supply chain traceability. While the majority of people we surveyed reported cost reduction and risk management as their top strategic priorities for 2025, many are also continuing to prioritise digital transformation in new ways, focusing on the organisational and human aspects as well as process efficiency. Looking ahead, there’s a lot to be optimistic about: The future of procurement is bright and digital.
77% of companies are equipped with source-to-pay digital solutions. This suggests that the digitalisation of processes is no longer a nice-to-have, but now a necessity. Looking ahead, procurement departments set very ambitious digitalisation objectives for 2025, with an average target of 72% of digitalization. Middle market companies, which are usually less digitalised, plan to strongly increase their investments in procurement digital transformation, while large and very large companies will maintain their budgets.
For the majority of CPOs, cost reduction and strategic sourcing remain their top priorities, followed by digital transformation. As hybrid models of work continue, so too will the need for ongoing digitalisation. Our study showed that more than 80% of companies with a high level of process digitalisation succeed with value creation thanks to data availability, but 55% of companies still struggle leveraging their data.
More than a third of procurement departments plan to invest in a solution to assess the carbon footprint of their suppliers by 2025. According to our survey, more CPOs are focusing their roadmap on source-to-pay digitalisation as well as on innovative use cases of ESG and supply chain traceability. Looking ahead, the tracking of suppliers’ CO2 emissions is expected to be a game-changer for procurement departments, with 27% of companies already using or experimenting with it. Purchasing also has a key role to play in the energy transition, which can be facilitated and accelerated by appropriate digital solutions.
90% of procurement departments reported being concerned by cyber security and 27% having already experienced an intrusion. This is likely caused by the increasing digitalisation and ongoing ambitions for the future. In terms of emerging tech, however, like blockchain, the jury is still out. The applicability of blockchain in procurement processes still needs to be clarified for 59% of procurement departments.
Putting people first matters. As we’ve all seen, the importance of cooperation continues to rise in hybrid work models, making organisational and human aspects critical to success in any digital transformation project. In our survey, more than 57% of procurement professionals reported “involvement of stakeholders” as the most important success factor for digital transformation.
Again, taking a human-led, tech-enabled perspective is the way to go, so be sure to consider any new processes from your users’ perspective, while relying on best practices, in order to successfully and sustainably implement change. More than 50% of respondents identified process optimization and efficiency as critical to digital transformation.
Technical aspects, such as the integrator or the chosen solution, are also important, though they are often seen as secondary success factors. But the focus on the previous two factors, namely process reengineering and stakeholder buy-in, instead of solution features and capabilities, also reveals that CPOs expect solutions to be implemented well from a technical perspective.
The emergence of these new risks has changed the perception of digital transformation by procurement departments. While digitalisation continues to progress among companies in all sectors, it is now becoming a necessity to overcome the challenges of cost control, supply chain traceability, and supplier relation securitisation.