As digital transformation continues to revolutionize the way you do business, modernizing your procurement system needs to be a key strategy to support your growth and the value you bring your customers.
Upgrading from the legacy procurement technology and processes you may still be using to cloud-based digital purchasing can make buying for your business every bit as easy as your personal online shopping, offering a similarly intuitive user experience (UX). And not only that: moving to cloud-based procurement can give you a robust set of tools to help you streamline operations, manage spend, and meet strategic goals.
Organizations often spend too much time, money, and resources building a network of suppliers to keep their business running. But global threats to the supply chain—pandemics, climate change, war—never stop emerging. And depending entirely on these systems to work without hiccups can put your operations at risk.
Organizations depend on their procurement leaders to guide innovation and make buying more agile in order to stay competitive and always prepared for disruption. While cost savings remain a significant priority, respondents to Deloitte’s 2021 Global Chief Procurement Officer Survey identified operational efficiency (78%), digital transformation (76%), and innovation (73%) as critical strategic goals.
Digital procurement offers these leaders solutions to their sourcing challenges, including easy and secure onboarding of users, automation of budgets, ordering, delivery, and invoicing. Moreover, shifting from the rudimentary purchasing data that legacy systems serve to the more sophisticated analytics a digital procurement system generates can provide managers with insights to track and control spending, drive compliance, monitor purchasing patterns, and meet larger, organization-wide goals.
“We see a pretty significant cost advantage on most products. But the biggest thing is the morale boost for the workforce, because they’re empowered to get the things they need faster, with less red tape, and with fewer procedures.”
— Kevin Jackson, Logistics Manager, Mid-Continent Business Unit at Chevron
As one of the largest energy companies in the world, Chevron’s purchasing needs are complex and diverse. In 2018, the company overhauled its procurement systems and turned to Amazon Business for its purchasing needs. The one-stop sourcing solution combines the ease and familiar UX of the consumer shopping experience with robust, real-time analytics, time-saving features, and a suite of spend-management controls.
Managing and curating reorder lists allows the managers of Chevron’s 300 company-owned gas stations to reduce the time they spend on the purchasing process. “We’ve been able to procure the items we need and put them on a reorder list. It also provides us with competitive pricing,” says Nicole Cannon, operations lead at Chevron. “Store managers can go on Amazon Business, click through everything they need, and add them to the cart. It’s a five-minute process.”
In addition, flexible, predictable shipping options help employees get the supplies they need on demand. For employees at Chevron gas stations, where storage space is at a premium, just-in-time shipping from a set of curated lists has been transformational.
“We see a pretty significant cost advantage on most products,” says Kevin Jackson, logistics manager, Mid-Continent Business Unit at Chevron. “But the biggest thing is the morale boost for the workforce, because they’re empowered to get the things they need faster, with less red tape, and with fewer procedures.”
In addition to increasing efficiency and reducing cost, digitizing procurement operations also gives companies tools to track progress against strategic goals like corporate social responsibility (CSR). Features such as Guided Buying, a Business Prime benefit, enable managers to designate certain products as preferred, so companies can steer their spending to support their CSR goals by increasing supplier diversity, purchasing locally, or buying more-sustainable supplies.
Volvo Car USA (Volvo Cars) uses guided buying to scale and source its purchasing in alignment with the company’s commitment to sustainability.
“We’re incentivizing our retailers to remove all single-use plastics, and it’s important for us to have just one process across all retailers,” says Alex Penning, senior buyer expert at Volvo Cars. “We’re helping out the retailers by subsidizing a portion of the products that we’re encouraging them to utilize, and we can track and make sure that they received them. It eliminates a lot of the manual effort for the Volvo network development team.”
Organizations must see their procurement systems as a strategic business function to outperform the competition, and cloud-based digital procurement is vital to that strategy. Finding a partner that can help streamline operations and balance cost and efficiency is no longer a tactical addition to growth strategy; today’s business landscape makes it necessary.
By optimizing procurement and moving to a cloud-based purchasing system, your organization can become as agile as it needs to be, responding in real time to shifting buying needs to strengthen your entire business performance. The shift to digital buying enables your organization and employees to focus on your biggest priorities: developing products and services, meeting your strategic goals, and growing your business.
Customers already using or interested in using AWS for cloud services may be able to benefit from complementary Amazon Business procurement services to help you make faster and more informed supply-chain decisions. For example, AWS Supply Chain is an AWS cloud-based application that offers real-time visibility into operations to help you forecast and mitigate inventory risks. And as a centralized ordering solution, Amazon Business can help you streamline B2B procurement and integrate with your organization’s procurement tools and systems with an enterprise-ready Amazon.com experience.
Originally published on Harvard Business Review, click here to view.
Learn how Amazon Business can help your organization boost its procurement and growth
We'll translate the most important information for your browsing, shopping, and communications. Our translations are provided for your convenience. The English version of business.amazon.com, including our Conditions of Use, is the definitive version. Learn more
More languages are available from other Amazon websites.