PROCUREMENT
Digital Technologies Revolutionising Procurement Fortunately , we ’ ve got a selection of industry-leaders in the procurement field to talk us through some of the emerging gamechanging technologies that are currently hitting the sector by storm — or they should be , at least .
So without further ado , let ’ s take a look at a few of the most interesting technological developments that we can expect to see the widespread adoption of across procurement in the coming years .
Blockchain Technology — The Smart Contract We all know about blockchain technology ; it ’ s essentially a distributed ledger technology within which transactions of any kind are both immutable and publicly visible , resulting in a far more transparent system that ensures accountability across procurement and supply chain processes , courtesy of a peer-to-peer , decentralised network .
According to David Food , Strategy Director at Prophetic Technology and Principal Lecturer of Supply Chain and Innovation at Royal Holloway College , “ Procurement ’ s rigorous rulings and transparency requisites are embedded on top of other functions , such as ensuring efficient payment processes , data security , or supervising a distinct group of suppliers .
“ Blockchain technology puts incredible value on procurement forwards . It facilitates adding records into a ledger for processes involving multiple parties . However , new companies still talk about the importance of blockchain in procurement .”
Food elaborates that smart contracts , a feature exclusive to the blockchain , are a regular talking-point for companies with a vested interest in using the distributed ledger technology to better their business operations and procurement processes .
“ A Smart Contract is a collection of executable codes , for instance , a software program – that runs on top of the Blockchain to complete the contract . It can automatically locate , reach and close deals just throughout the SC , and with no need of relying on the third-party ,” he explains .
“ The Smart Contract will perform smoothly as programmed , with terms and conditions stipulated by both sides , enhancing trust and making both the contract and the identity of stakeholders ’ mandatory . When specific circumstances are met , it will automatically deliver a result or trigger an event - for example , if a payment has been collected , delivery can be automatically activated . On the contrary , if a condition is not met , for instance , timely delivery , a penalty can be set .
“ Given that smart contracts based on software programs run automatically , operating information confirmed by blockchain as correct , manual checking of any issue can constrain third parties drastically , dropping transaction costs making it easier to get valuable transactions outcomes .” supplychaindigital . com 35