Can a Cracked Smartphone Shed Light on the Future of Procurement?

Posted: 07/30/2018 - 05:09

If a broken mirror causes seven years of bad luck, then what does it mean when your smartphone screen shatters? Uncertain of the answer, I really didn’t want to find out. So the other day, facing this fateful predicament, I hurried to the store for a replacement. Unfortunately, the retailer was out of stock. I needed to back-order a new glassy portal into my online existence

But did the store’s depleted inventory signal bad luck…or merely a lack of imagination in procurement execution? What if behind the counter sat a 3D printer linked to the retailer’s supply chain? Maybe I could have walked right out with my smartphone repaired and my insatiable need to check social media every five minutes renewed.

Does it sound futuristic to extend the supply chain to the point of purchase? The future – in which procurement networks and digital manufacturing meet consumers where they shop – may be closer than we realize.

Through cloud-based platforms, companies and their suppliers gain broad visibility into each other’s interconnected operations and, with it, the ability to collaborate on design, production and innovation. Out of these digital networks have emerged new operating models in which 3D printing can bring the supply chain right to a retailer’s doorstep.

This was welcome news because the effects of smartphone withdrawal were beginning to bear down on me while waiting for the replacement screen to arrive. Of course, the possibilities go well beyond handheld devicesThink of the food pantry that needs a spare part to restore its refrigeration system. Or the nursing home in search of a valve to repair its malfunctioning boiler in wintertime. Or the local emergency services corps that needs to replace a worn-out component in its only fire engineOr the rural health clinic on a quest to procure a hard-to-find prosthetic device. When the situation is urgent, even the most efficiently designed supply chain can fall short. But when integrated with cloud-based procurement networks, digital manufacturing capabilities can respond to acute needs with immediacy and precision — not only when they’re needed, but where.

Using a network that combines procurement processes with 3D printing functionalitymanufacturers can connect their design, sourcing, production and procurement processes and manage them jointly to:

  • Collaborate on production decisions, highlight changes and suggest alternatives
  • Link design discussions and data to requests for quotation
  • Obtain pricing from one or more suppliers for parts and initiate the buying process
  • Share data and key performance indicators with all relevant parties
  • Coordinate with suppliers on manufacturing changes

Meanwhile, suppliers can forge new models for operating and expand their businesses by using such a platform to:

  • Differentiate themselves through technical skills and capabilities
  • Gain a clear understanding of customer needs
  • Work together on early design to enable manufacturing of parts at optimized cost
  • Provide manufacturing capabilities as a service

But while the convergence of procurement and digital manufacturing holds a great deal of promise for businesses and their trading partners, perhaps the greatest advantage accrues to consumers when a trip to the local store becomes tantamount to a visit with all of its suppliers.

 

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About The Author

Marcell Vollmer's picture

Marcell Vollmer is Chief Digital Officer for SAP Ariba and is responsible for defining and driving Digital Transformation for customers of SAP Ariba globally. A thought leader in procurement, supply chain, finance and shared services, Marcell’s expertise lies in defining digital transformation strategy and to make Run Simple a reality for global customers and consumers by delivering high cost and additionalprocurement savings. Previously, he was Chief Operating Officer for SAP Ariba where he successfully developed and led global business development, procurement, go to market, sales operations, and enablement. And prior to that Marcell was Chief Procurement Officer of SAP and was responsible for the reorganization and process optimization for and end-to-end source-to-settle organization. Since joining SAP in 2005 he has held various leadership roles involving restructuring, improving project efficiency and execution of global programs in finance, procurement, sales, human resources and post-merger integrations.



Mukta Dhanuka's picture

Mukta Dhanuka is senior consultant – chief digital office at SAP Ariba and software specialist – C/4HANA and Cloud CRM.