"Procurement organizations that are able to master knowledge around their workflows and categories, and bring that intelligence on demand into their processes and tech, are going to really be able to get that 5x, 10x, 20x kind of performance advantage. It’s a game-changer.” - Pierre Mitchell, Chief Research Officer and Managing Director, Spend Matters
Procurement technology is constantly evolving. While it does not define procurement, it is one of the most prevalent ways procurement reaches out into the company to connect with functional teams and individual users.
In this Art of Procurement podcast episode, I spoke with Pierre Mitchell, Chief Research Officer and Managing Director at Spend Matters, about the critical factors impacting the procure tech market and how procurement leaders can wade through a crowded, fragmented, (and still growing!) procure tech landscape.
Here, in Pierre’s own words, are some of his key observations and predictions for the procure tech market in 2025 and beyond:
Coping with a Fragmented Procure Tech Market
“You have to go back to the first principles, right? For anybody in procurement who wants to learn about tech would, it's good to master things around understanding architectures and data models and how applications work. The world of IT and technology, there’s two different worlds. There’s a process view of technology, and the other part is data.”
Build for Data
“No matter what apps you're building, whether it's in source to pay or in enterprise risk or whatever, at the end of the day, there's going to be data in a data model. And whether that's in little objects or a big monolith, a big set of suites and an integrated data model, there's going to be a data story. There's going to be a process automation story. That's where orchestration primarily lives.”
Data’s Never Ending Story
“You have to clean as you go and identify the root cause data problems. For example, maybe you find end users putting in bad commodity codes during the P2P process. Great. Let's tackle some of the low hanging fruit there. Then we attack some things around the vendor master and start to build our muscles around data governance and data management and modeling, not just the data quality and effect, which is the result of too many systems and obtaining poor data governance. All those things are root causes. You have to know what you're dealing with and start to address them incrementally, because you're never going to solve it all. You just have to deal with it on an ongoing basis.”
The Transformative Power of Gen AI for Procure Tech
“Taking all this data that sits in contract portfolios and sitting in your policy documents and sitting out on the outside, all that market intelligence that you're bringing in. All of that is starting to coalesce, both from the relational database apps models that are trying to go broader and be able to be more but have not turned the data into knowledge. Then there is what you see on the service or the hyperscaler side and all the gen AI providers. They're taking in this mass data and trying to make that more usable. It's bringing those things together that's powerful. A lot of the service providers are actually taking the knowledge that's in their heads and building solutions with that collective knowledge from all their consultants. But you can do the same thing with community intelligence.”
Key Trends Impacting Procure Tech
“The latest trend is geopolitical chaos and planning about what to do around that. Unfortunately, I have not yet seen a single app that does dynamic supply network cost planning all the way to the consumer level. It's a real mashup of different things. That does expose where you're lacking a lot of strategic data.
There is also a trend towards starting to get serious about managing our organizational knowledge, given that we have a talent problem with folks that are either walking out the door or constantly churning and new folks are coming in and bringing new thinking and skills. So you get a lot of the new supply chain MBAs coming in, and they have no patience for old tech built 10 or 20 years ago. They want to be able to move fast, and they want to be able to change the tooling. They're willing to put in the work here, but they are not accepting the status quo.”
