Supply Chain Management: Ariba study looks into procurement’s crystal ball

A recent study conducted by Ariba reveals there may be broad agreement among supply chain executives about the industry’s fortunes over the next decade.

Named “Vision 2020,” the study examines the changing role of how companies source and procure materials. It was designed to gather large industry thought leaders to come to several main conclusions.

“Among the key findings is the fact that everything will be automated, and information will be synthesized,” said Tim Minahan, Ariba’s chief marketing officer. In an interview with SCMR, he said that the “virtual” will also replace the “physical.”

“Data will become predictive, and prices will be more transparent as a consequence,” said Minahan. “If there’s one lesson we learned from the great recession it is that visibility must exist throughout the supply chain.”

Participants in this study included executives from MetLife, Key Bank, HP and The Home Depot. According to Minahan, this comprises the procurement specialists who first “rolled up their sleeves” late in the last century to shape leading procurement practices from tactical paper pushing into things like spend management, strategic sourcing, supplier collaboration, electronic commerce, sourcing and procurement process automation.

“Another key take away,” said Minahan, was that spend management will disappear and outsourcing will explode.”

But without the usual “sourcing geeks,” he added.

“Some of the ideas presented in these pages have been kicking around for quite some years, although the conditions under which they might flourish have yet to materialize in more than a handful of enterprises. The hope is that—with all that has been accomplished in the past decade—the time for these ideas may finally be coming,” said Minahan.

Ariba spokesmen said that the report is intended not as an end, but rather as a point of departure for much discussion and debate around where procurement can and should be setting its sights for the year 2020 and beyond.

“Final conclusions that we hope readers share are that corporate attention will turn outward, and price will in the end, give way to value.”

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