How IBM reimagined its procurement systems

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How has IBM gone about the transformation of its vast network of procurement systems?

In a recent online report, the company shares insight into how it reimagined its processes to connect with 13,000 suppliers across 170 countries.  

Pre-transformation, IBM says it had had “long-entrenched processes” and “siloed data” across the organisation. This, it says, led  to frustrations with the procurement process. IBM knew it needed an updated approach to its procurement capabilities. 

Its procurement teams faced key questions, such as whether they were achieving competitive prices on deals and whether they were getting bogged down in time-consuming non-core transactions.  

Also, it realised buyers were not working from analytical insights, but instead were having to create this information themselves. Worse, this data was siloed, in spreadsheets, which led to inconsistencies.

 

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Power of data in IBM transformation

IBM knew data was they key to transforming its procurement operation, andIt had to sort and analyse vast amounts of data that had to be sorted and analysed, before it could implement AI solutions to allow the prediction of prices and trends.  

IBM assembled a cross-disciplinary team of experts from IT, process consulting, AI and procurement to work on the data. This started to deliver insights within weeks, and help[ed it create a procurement analytics platform with applications that embrace the full source-to-pay offering.

Moving away from siloed data towards visible internal and external data allows IBM’s procurement teams to gain rich insight into spending and market values. This in turn encourages a more strategic approach to spend management through the base of suppliers.

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Impact of procurement transformation on IBM

Following the success of the transformation IBM has made the solution available to its customers, partners and clients. It now describes its procurement analytics platform as ‘core’ to its operations globally. 

The technology allows buying teams to be strategic in how they trade with their supply base, says IBM, and adds that tasks that once took days now take mere minutes.  

In short, IBM has optimised 62 million lead-to-cash transitions annually, which is helping its procurement teams meet the demands of today’s ever changing landscape. 


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