The role of the procurement function is expanding from bargain hunter to business partner. Chief procurement officers (CPOs) recognize they must adopt more digitally sophisticated, data-driven practices to cope with both immediate challenges and longer-term goals—with 24 percent of respondents in a 2024 McKinsey procurement webinar saying digital enablement is now a core priority, up from just 2 percent in 2023.1
In short, procurement is pivoting to become a strategic value lever for the business—and embracing digital transformation is the unlock to both creating and preserving value. Advanced analytics and AI are seen as critical to drive this next-level performance. Indeed, technology such as generative AI (gen AI) is poised to help procurement meet these new demands.
Contract optimization and compliance create opportunities for immediate impact
Amid this drive for transformation, companies are zeroing in on two sizable areas of improvement across source-to-pay. Pain points in both these areas have long plagued procurement, quietly draining value. Tackling them represents a major opportunity to boost the bottom line.
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