Procurement Lessons from the Industrial Revolution
The Industrial Revolution is seen as one of the most successful and pivotal points in American history. Without it, most of the technologies we use today would not exist. Procurement was the key driver for success in the 18th and 19th centuries – it changed technology – and it continues to influence the world today.
The Industrial Revolution highlights the importance of procurement. Here are three lessons we have learned from history:
1. Use automation to take the dirty work off your plate.
Imagine this: it’s the 19th century and you own a business. You don’t have a streamlined way of managing all of your processes. What if there was a better, more efficient way to perform these daily tasks? The Industrial Revolution looked to answer this question, leading to the emergence of new technologies. These new technologies brought forth new ways to automate production – which led to increased output for less money, uncovering savings.
Today, business owners look to do the same, except they have already discovered ways to save. Much like their ancestors they ask, “what if I could do more?” Like the business leaders from yesteryear, today’s procurement professionals are looking to capitalize on automation technology to reduce the dirty work. Their goal is to discover value, but this time, beyond obvious savings.
2. Don’t rely on manual processes to find the best value.
Manually managing multiple suppliers is difficult. Let’s go back to our previous imaginings: your business needs supplies to continue producing your product. In order to find the materials you need, you would have to find the right materials at the best cost, manage the supplier relationship yourself and keep contracts and budgetary records yourself. That’s a lot of yourselves. And when it’s all over, do you really know if you provided the best value for your business?
We have learned from history that manual processes are not always the most beneficial. Today, we look to minimize manual procurement processes and maximize value by utilizing preferred suppliers, catalog management and contract compliance tracking. With procurement software, a simple search will find an item yielding the best value for your business (based on parameters you set which can include cost, geography, etc.), making it that easy.
3. Intangibles win the day.
When you’ve implemented a solution that delivers hard savings, it’s easy to get caught up in the moment. However, when those savings become expected, you need to start looking for something more. Procurement technology does more than deliver hard savings, it eliminates the need for manual processes, boosts efficiencies, and reduces manual errors, leading to more effectiveness. You can spend less time manually performing your procurement processes and use your free time to develop strategies. With the right technology and processes, procurement creates continuous value for your business.
Over the course of history, we have seen many events repeat themselves. What lesson can we learn from this phenomenon? That events will eventually reoccur, and when they do, we should recognize it and use our knowledge of the first events outcome to anticipate the likely outcome.
Take a lesson from history and ask yourself: is my company on the cusp of its own revolution? And how could the right procurement software help that revolution happen faster?
What lessons have you learned from history? Let us know on Twitter!