According to the global management consulting firm McKinsey & Company, procurement leaders are realizing that, to remain competitive, they must adopt B2B online marketplaces to manage indirect procurement — a spend category that includes services and utilities vital for business operations.
To quote the recent McKinsey article on the topic,
“Industry analysts project that by 2021, indirect spending will be led and directed by tech-procurement people at up to 60 percent of large enterprises.”
“Indirect procurement will increasingly become platform management — a shift that will require teams to tailor their indirect procurement strategies more carefully."
Changes that are driving the transition of indirect procurement spend to online platforms include:
- Newly minted CPOs have increasing dependence on online shopping for all personal spend categories, including services
- B2B marketplaces deliver many benefits (see box)
- CPOs can perform against goals that are broader, more strategic than transaction management; can eliminate the tedious work of indirect procurement
- Companies rely more on 3rd party providers
- Increased scrutiny on compliance and risk mitigation
- Broader corporate emphasis on digital transformation
Evaluating B2B marketplaces for R&D services?
Start with this list of must-have features:
Large selection of pre-contracted and pre-qualified global vendors
Complete automation of the source-to-pay process, without the need for manual handling of RFQs, work orders, invoices and payments
Advanced business intelligence reporting that helps research and procurement leadership teams achieve and track business goals
Automation of collaboration, approval and compliance workflows
Smooth integrations with buyer’s file management, procurement and financial applications
Built-in guided buying configurations for driving purchasing adherence to preferred vendors
Clear accountability (single-vendor model) and system in place for refunds if necessary
A user experience that surpasses traditional procurement process–enjoyable, efficient, time-saving–so that users will WANT to use it
Payment options with currency choice
Benefits of B2B marketplaces for R&D services procurement
- Select from thousands of pre-contracted providers
- Price transparency—including dynamic pricing
- Initiate projects rapidly through automation of manual tasks
- Improve compliance and spend governance
- Reduce costs through competitive sourcing
- Configure custom internal marketplaces
- Track spend and budget performance in real time
- Gain visibility into provider performance