As Energy companies continue adjusting to a “lower for longer” oil price environment, supply chain management (SCM) organizations are expected to up the ante in the value they provide, driving visible cost reductions throughout the organization.
For SCM functions in the US onshore exploration and production (E&P) segment in particular, the downturn has proven especially challenging due to significant headcount reductions relative to overall activity.
Of the 72 percent of study participants who have fully implemented e-invoicing, more than three-quarters still rely on manual invoicing, meaning participants are not fully using the system they invested in. The reliance on manual “invoice-only” transactions suggests the need to drive adoption of automated solutions across the organization.
Organizations that use technology enablers tend to experience greater spend on contract and higher cost savings than their peers who do not.
SCM organizations that own the complete PO process have an average 63 percent greater spend on contract than organizations where business functions can process POs. The same respondents also boast 24 percent greater 2016 savings, on average, across key categories of spend, demonstrating that SCM organizations who fully execute the procurement process yield greater cost savings.
Principal, PwC US
Advisory Director, PwC US
Advisory Partner, PwC US