COVID-19: Priorities for procurement in four main stages

June 16th, 2020
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Management and AI consulting firm Sia Partners interviewed almost 250 procurement decision makers last April to gain a better understanding of the priorities for procurement departments in response to the global health crisis. The study reveals the key priorities for procurement at each of the four main stages of the COVID-19 crisis.

Stage one: The beginning of the crisis

As an immediate response to the pandemic, procurement departments reorganised their companies and primary networks to ensure that they continued to operate. Having adjusted to working remotely, procurement departments turned their focus towards three priorities: identifying risks, securing supplies and listing alternative products. They then adapted their systems (processes, governance etc.) and shared their solutions and initiatives with those placing orders.

Stage two: The middle and end of the crisis

During lockdown, the objective for procurement departments was twofold: to cope with the impact of the crisis, while preparing for recovery. After procuring urgent products related to COVID-19 (masks, hand sanitiser etc.), departments then drew up plans for recovery and emergency savings.

Stage three: After the crisis

Today, the majority of companies have now entered the critical stage where they are managing post-COVID-19 recovery.

To do this, procurement departments are starting to establish priorities, both in terms of supplier management and procurement files planned for the coming year. At a later stage, procurement departments will be able to share and learn from feedback, both internally and with their suppliers.

Stage four: The long term

Ultimately, businesses will have to prepare for the future by building COVID-19-proof supply chains and supplier pools. Procurement departments will therefore need to radically reconsider supplier relations, supply flows and contractual clauses.

Other issues, such as moving supply chains, traceability, organising procurement departments and reinventing how they work, will also need to be taken under careful consideration.

The crisis has given us insight into the shortcomings of our business models, which were not designed for such uncertain times. For Sia Partners, this is the perfect opportunity for procurement departments to increase their agility, expand their influence, and now more than ever, draw on data to optimise existing practices.

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