Balancing Efficiency with Strategic Impact by Embracing Digital Transformation

With the evolution of enterprises, procurement is transitioning from a transactional role to that of a strategic enabler, driving competitiveness and operational efficiency. Internal teams are balancing routine tasks with outsourcing high-value transactions to external experts. Industry-specific solutions and generative AI, used for tasks such as contract summarization and supplier selection, are enhancing procurement efficiency. These advancements free up teams for more strategic activities. As a result, the top factors influencing procurement engagements for service providers include process automation, optimization, and customized solutions, reflecting their growing importance in a dynamic landscape.

Both demand-side and supply-side trends are covered in our Procurement Business Process Transformation 2024 Market Insights™ and Procurement Business Process Transformation 2024 RadarView™, respectively. These reports present a comprehensive study of procurement business process transformation service providers and closely examine the market leaders, innovators, disruptors, and challengers. They also provide a view into key market trends and developments impacting the procurement space.

We evaluated 26 service providers across three dimensions: practice maturity, domain ecosystem, and investments and innovation. Of the 26 providers, we recognized 15 that brought the most value to the market during the past 12 months.

The report recognizes service providers in four categories:

• • Leaders: Accenture, Genpact, Infosys, GEP, IBM
  • Innovators: TCS, Wipro, Capgemini, HCL
  • Disruptors: WNS, Tech Mahindra, Corcentric
  • Challengers: Fullstep, Capita, Nexdigm

Figure 1 below from the full report illustrates these categories:

“Procurement is evolving with a focus on strategic transformation with priority toward customized services and solutions,” said Michael Wheeler, partner at Avasant. “Leveraging AI, automation, and generative AI, in addition to domain expertise, becomes crucial to boosting efficiency and unlocking higher-value opportunities.”

The reports provide a number of findings, including the following:

• • Industry-specific solutions are gaining traction as enterprises adapt to evolving procurement needs and seek more tailored solutions.
  • The top five factors influencing procurement engagements are customized solutions and services, savings from procurement outsourcing, cost of service, process automation and optimization and domain expertise, and the use of the latest technologies such as generative AI and cloud.
  • Enterprises are prioritizing the adoption of targeted generative AI applications as a first step in their broader generative AI strategy.
  • The number of clients using hybrid pricing models has increased by over 18%, reflecting a growing interest in leveraging diverse pricing strategies. This trend suggests that enterprises are seeking to optimize procurement costs and enhance value by integrating various pricing approaches.

“Organizations are investing heavily in their procurement teams and technologies, driving both efficiency and innovation across processes,” said Aditya Jain, research leader with Avasant. “Service providers need to integrate technologies with their offerings, such as contract management, to adapt to the evolving market.”

This RadarView features detailed profiles of 15 service providers, along with their solutions, offerings, and experience in assisting enterprises and individuals in their procurement transformation journey.

This Research Byte is a brief overview of Avasant’s Procurement Business Process Transformation 2024 Market Insights™ and Procurement Business Process Transformation 2024 RadarView™.  (Click for pricing.)