2020, the year procurement became important
2020 was a year of struggle. It was also a year in which procurement was able to shine. Procurement functions across Australia quickly adapted and shifted their focus from cost reduction to supply risk mitigation and back to cost reduction.
We surveyed 202 organisations in April, July and September 2020 to obtain a time-in-motion dataset that shows how the different stages of the crisis impacted procurement teams in Australia.
We found that the procurement function was a major lever for organisations in their reaction to the COVID-19 crisis and induced recession. While not every organisation was impacted in the same way, the importance of procurement grew no matter if the revenue impact was negative, positive or minimal.
We found that the importance of procurement increased, even in 76% of the organisations that experienced minimal impacts to their revenue.
For 36% of companies that endured a reduction of revenue by more than 10%, procurement had a more positive impact on the business than usual. For a further 37% it had become critical.
Most striking: the impact that procurement had for those lucky enough to have experienced a positive revenue impact; 95% of these organisations thanked their procurement team for its ability to increase supply to meet the demand generated by their customers.
To understand how procurement reacted to other challenges in 2020, download our ebook.