Innovation in Digitalisation and Technology: Insights from the Ecosystem
During a three-day conference ‘Innovation in Digitalisation and Technology’, Costas Xyloyiannis, CEO at HICX, joined Steve Hall of Procurement Leaders for a session on ‘Insights from the ecosystem’, broadcast live on Thursday 27th May. They discussed Supplier Experience Management (SXM): how it is moving up the agenda and how, in combination with technology, it can generate greater value for customers and suppliers alike, as well as improve competitiveness.
The rise and adoption of best-of-breed technology in Procurement
Costas starts the discussion by stressing the increasing adoption of best-of-breed technology. According to Costas, “User experience (UX) drives the need for best-of-breed. People have learned that better user experience actually means better adoption, compliance and efficiency.” ERPs, he says, have not delivered on the promise that ‘doing everything in one solution’ will necessarily be optimal, easy and efficient.
In 2021, with data challenges continuing to persist, organizations have increasingly realized that it is not possible to do everything in one solution, hence the need for specialized technology services. Additionally, barriers to entry for emerging technology providers are much lower today, especially in the cloud-based and SaaS solution space. Similarly, barriers to adoption for buyers are also lower as a result of the ‘consumerization’ of IT purchasing.
Challenges of adopting best-of-breed technology in Procurement
One aspect that is always a challenge for any organization is the integration of different systems. It can be hard to integrate workflows that span across multiple teams and processes, especially if they involve software applications from multiple vendors. However, best-of-breed solutions today are built with integration in mind, from the start.
As Costas explains, “Integration itself is not as difficult – but the data is not flowing between the systems and that is the main challenge. You have to make the data flow.”
When thinking of data, Costas points out that organizations must ask themselves, “’How do I bring all my disparate systems together and how do I create an operational hierarchy?’” He warns, “A lot of projects are delayed on trying to bring data together. Having the capability to create operational hierarchy is a must.”
The other major challenge is the experience layer. This is a new idea which has emerged as organizations realize that they need an ‘experience portal’ that spans across multiple systems and that can aggregate tasks, events, notifications and analytics, based on business requirements. Additionally, this is crucial for procurement and supply chain, as the challenges discussed have a disproportionally damaging effect on the experience that organizations provide to their suppliers.
Tackling the challenges while capitalizing on best-of-breed innovation
Overcoming these challenges may seem daunting, however Costas has some advice. He believes that people must “work internally to get away from this idea that fewer systems equals simpler or better.” Also, trying to unify everything on to a single platform can be a waste of resources, as even the most suite-centric companies have multiple systems, having grown through acquisitions. As a ‘100% suite’ deployment does not exist, the real question that needs an answer therefore, is ‘How are organizations going to manage the hybrid model?’ which is here to stay.
Costas concludes by reminding us that organizations are often distracted by the notion that “many systems equal complexity,” whereas we should, he says, “…be measuring the true business results of user experience, NPS, total cost of ownership, and data quality.“