What Trends and Changes CPOs Need to Prepare For

December 16, 2022

“Process adaptability will be key in 2023. Many CPOs do not realize the amount of change coming their way and are not prepared for them. The next few years will not be business as usual. CPOs need to put the right technology in place to manage those new risks and uncertainties,” says Jag Lamba, Chief Executive Officer, Certa.

Certa is a service provider at the marcus evans Chief Procurement Officer Summit 2023.

What are the top trends CPOs need to keep their eyes on?

The first one is process adaptability. The supply chain world is changing so fast, with new geopolitical issues forcing people to shift supply chains to more friendly countries. Moreover, risks related to sanctions and new regulations on data privacy and security, human rights and ESG are all requiring fundamental process changes. On top of these, priorities are evolving because of economic pressures. Our number one piece of advice is to focus on process adaptability and be open to change. The underlying technology stack needs to be flexible. The mindset of the team needs to be open to shifting priorities, processes and tools. They need to be ready to adapt. CPOs need to communicate with the board upfront that things will change and seek their input.

From a technology perspective, the CPO’s team needs a no-code workflow technology, where they can change, drag and drop processes, and add integrations based on the environment. That will be the most fundamental building block for these changes. Certa’s SaaS platform can provide that customizability. It is the only one in the market that is truly enterprise-ready, multi-lingual with 13 languages, with advanced data residency features, and all the compliance controls in place.

AI will also have a massive impact. After years of promises, it is finally user-friendly and accurate enough to be practical.

Do you think CPOs are ready for these changes and risks?

They don’t have a choice. Some CPOs are being proactive about it while others are being dragged into it. My advice is to expect change; accept that it will happen. It is better to prepare their teams, tools and the board. If they do not do it proactively, they will have to do it reactively.

CPOs are not currently prepared for the amount of change that is coming their way. They do not think it will be as massive as we believe it will be. The sanctions with Russia and so on will keep evolving. Almost every month there are new regulations somewhere. They will need to be very adaptable to make sure they are always on top of regulations.

ESG will go from a nice-to-have to an absolute-must-have. CPOs will need to account for the carbon footprint of their entire company, and 80 percent of that depends on their supply chain. The biggest risk CPOs are not preparing for is the number of requirements they will have to deal with from an ESG perspective. Today they struggle with just capturing and maintaining up-to-date data on their suppliers. Most large companies have over 10,000 suppliers. Imagine a world where every quarter they need to collect from every supplier how much carbon they have expended in servicing them. CPOs are not equipped to handle this logistical nightmare. Most of them come from a spend management background, which will still be needed, but going forward they will also need to manage their company’s carbon footprint. They have no idea how that will impact the procurement organization and the company’s DNA.

What is the “procurement platform of the future”? What attributes will it have?

It will be flexible and extensible. You do not want to look for another solution for every new use case. That leads to SaaS fatigue when people must sign into 20 different systems to get something done. Second, it needs to be global, in terms of languages and data residency requirements. Third, it must be super user-friendly. No one is willing to spend time on training thousands of employees or suppliers.

How does the Certa platform automate 80 percent of risk?

With 100 percent visibility for every single process and supplier. The technology can see what has been completed, what is delayed, every single thing, in a nice visual map. Is it stuck with legal, compliance, information security, privacy or IT? Companies do not have the bandwidth to manually review every single supplier and every single risk for the supplier, so they create automated rules. They can assess different risks and automate what needs to be done in terms of due diligence to overcome those risks. Risk-adjusted due diligence is the way we are able to automate away 80 percent of the risk tasks.

Share with your friends!