Industry 4.0 has brought about a real revolution for manufacturing businesses, leading to many changes in procurement management.
Réal Julien, J2 President, says it is vital that businesses keep step with this industrial revolution in their procurement management.
What is industry 4.0?
After mechanization, assembly lines and automation, digitalization and artificial intelligence are now coming into play.
“4.0 is an industrial revolution that is making manufacturing more efficient through digitalization and artificial intelligence. These technologies plug businesses into their ecosystem, enabling them to respond to demand in real time.” – Réal Julien
For Réal Julien, an entrepreneur with over 25 years’ experience in purchasing, it is clear that the 4.0 revolution is here to stay. And it will bring changes to every department of manufacturing businesses, including the purchasing department.
Here are the 5 main trends to watch in procurement management 4.0.
1. Supply chain optimization and automation
With industry 4.0, all the management systems of organizations can perform many administrative operations automatically.
For example, an employee who devoted considerable time to tasks such as expense accounts or bank reconciliation can save precious time today simply by delegating tactical operations to artificial intelligence. Just imagine the savings of time and money that can result!
But despite this potential for savings, the purchasing departments of Canadian businesses are slow to get on the industry 4.0 bandwagon. This is why J2 attaches great importance to raising the awareness of managers, who may not realize the impact of artificial intelligence in procurement management.
2. Changing roles for buyers
Many people assume that in procurement management, industry 4.0 will inevitably lead to job losses. Not necessarily! However, the required workforce will be different.
Buyers will inevitably see their role change to become more that of a strategist. With 4.0, they will be able to take a step back and look at the big picture rather than spending their time performing operations. This means they will have to become more ambitious and more creative in order to generate value.
3. New functionalities for management systems
Many customer relations management (CRM) systems have artificial intelligence built into their functionality to help businesses become more efficient.
For example, if you need to talk to a supplier, your CRM system can show you what time of day the person concerned is more likely to be in the office. Through data mining, all the information gathered by your business will be analyzed, filtered and reused on a timely basis.
4. Greater importance placed on programming
Since industry 4.0 uses artificial intelligence, programming will become important – indeed, essential – for businesses.
Many solutions can facilitate programming for your procurement management:
- using open source software, whose code can easily be modified
- developing simplified programming code
- hiring a programmer
5. Changing business relations
With massive data exchange between systems, it will no longer be necessary to send emails or use the telephone so often. All that is needed will be to look into your information system and send the order automatically. Buyers and suppliers will save valuable time!
J2 will help you optimize your entire procurement management
Your purchasing department must keep up with the industry of the future: the industry of digitalization, data management and artificial intelligence. Industry 4.0 is a game changer, and adapting to it is vital.
Competition has changed: it is no longer a case of big businesses against small businesses, but of businesses who can adapt quickly against those that lag behind.
Contact J2 for support in optimizing your purchasing management and gain in productivity.