Name: Procurement as a Strategic Partner: The Path to Value
Uploaded: 2025-11-13T19:05:49.887Z
Duration: 33 min 20 s
Description: Procurement as a Strategic Partner: The Path to Value

Transcript for "Procurement as a Strategic Partner: The Path to Value": Alright. Welcome, everyone. I'm Heidi Wall from Coupa, and I am part of our alliance team. And today, we're gonna be talking about the perfect storm that procurement leaders are facing, which is caused by global complexity, inflationary pressures, and the disruptive force of AI. The mandate for CPOs is clear, deliver greater impact with fewer resources, all while protecting enterprise value. No small task. So I'm joined today by two experts that are gonna help us with a conversation, Tricia Miller from Coupa and Ryan Flynn from Deloitte. Deloitte provides the leadership perspective of the why and the what while Coupa delivers the tools, data, and KPIs to make it real. We'll be discussing the strategic direction in taking how leaders are operationally operationalizing trusted AI, how to measure ROI, and strategies for derisking your business to unlock capital. The insights we're gonna be sharing today are anchored around two reports. Coupa has an annual KPI, benchmark report and Deloitte's annual CPO survey. So before I hand it over to my guests, I just wanna let you know that you can answer or you can ask questions in the q and a section. And, hopefully, at the end of this presentation, we'll be able to answer those questions live. If we don't have time to get to your questions, we'll make sure to follow-up afterwards. So let's get started with introductions. Tricia, wanna go ahead and introduce yourself? And if you can, I'd love to hear a little bit more about Coupa's benchmark report. Yes. Thank you very much, Heidi. Very excited to be here and and discuss this topic with Ryan because I think we you know, as we go through this, we'll really see the relevance, of hopefully some of what these reports present and how that can steer and let the strategies of of our, procurement leaders, currently. But, I'm a relatively new joint to Coupa. I came into Coupa, in a marketing role. So I have responsibility for product marketing and customer experience marketing. I come with no experience in marketing, though. My entire career was spent in the digitization of the procurement function and the I ended up being a CPO and a large multinational professional services firm. And so my aspiration in this role is to really think about how we help our customers understand not what a technology does, but more importantly, how when they use that technology, how when they use Coupa, they'll deliver value or achieve that greater impact that they aspire to. And the benchmark report to me is an incredibly valuable asset that Coupa has. It is built on all of the insights across our customers as we look at what the maturity is against these key benchmarks. And any conversation I've had to date in the couple of months I've been here, my outline and steer to our customers and our prospects is look at that benchmark report, identify the few items where you want to get better at, and then start charting the path on what you need to do and how you adopt this different solutions, different talent, to really drive improvement against those numbers. Thanks, Tricia. And same with you, Ryan, if you could, as part of your introduction, talk a little bit more about the CPO survey that Deloitte has. Yeah. Thanks, Heidi, and great to be with both of you today. So I'm Ryan Flynn. I'm a partner in Deloitte's sourcing and procurement practice. I've spent the last twenty three years helping companies transform their procurement capabilities with help from digital solutions, like Coupa. I've done a bunch of different types of work in the procurement space, from strategic sourcing and operating model design to, system selection and implementation. I also lead our alliance with Coupa in The US as well as our global CPO survey, which we just released in June and is focused on the impact of AI in procurement. So this is our twelfth edition of the CPO survey. We're on a biannual cadence, for the survey right now, and we generally get, responses from a truly global perspective. Around 40 countries have folks responding to the survey. And, really, almost every industry is represented, in the survey as well. So I'll talk a little bit more as we go through discussion, on the findings from the CPO survey, which again is focused on the impact of AI in, in procurement. Great. Thanks, Ryan. Thanks, Tricia. So to kind of set the table for this conversation, can you, Ryan, can you talk about I know you talk to CPOs a lot. Can you talk about the challenges that you're hearing from these CPOs? Yeah. So, you know, I think this is a really interesting time, for procurement. And it really feels to me, based on conversations that I've had and based on the findings from the survey, that procurement's at an inflection point. So what we found in the survey is that CPOs are continuing to increase their role and the value they're delivering to the business across multiple areas. So not just your traditional, you know, cost savings, cost avoidance, but also getting into areas like innovation and risk management. And what this, has meant is that the success of the procurement function has increased the demands, on procurement. And while welcome, I mean, honestly, this is something about, which I've been talking about since I joined, you know, procurement, sourcing and procurement at Deloitte, over twenty years ago. This success really comes at a time of both increasing complexity as well as kind of pressure on resources. So it's created this conundrum for CPOs, which is how do you continue to deliver more and more value, with the same or potentially even fewer people? And if you look at the survey and the respondents to the survey, they really think that that answer lies in digital transformation, including AI, which is a top priority, listed by CPOs, at over the next year. So I really think, we're at a point now where the companies that get this right are going to create real strategic advantage, moving forward. So that's what makes this time, really interesting to me and, I think, important for procurement as a function. Great. Thanks, Ryan. And, Trisha, I know you've been leading the charge with Coupa's AI Roadshow. Anything that you wanna add from the conversations that you're having with CTOs and procurement leaders? Yeah. I am I mean, in reality, it's a good problem to have. Right? For the longest time, procurement leaders have been asking for a seat at the table. They've done enough good things, and the general understanding of procurement has increased enough that they're finally getting that seat at the table. But now we have to figure out how we help them take the seat with confidence, to deliver to all these expectations. So great problem to have, but but they need help in being able to respond to that problem. I am not as surprised at all to see that when CPOs were pulled, they really were balancing that need for digitization and talent because in all honesty, both things are necessary for them to be successful. The reality of it is is they're being asked to drive standardization, simplification, and digitization of the function, and build new skills. So how are they doing supplier relationship management, business partnering, responding to ESG agendas, closing the spend management and all these things. And and while the technology might drive out those standardized, simplify, and automate, it isn't helping them with the talent. So they really need to recognize that they have to chart a path for their people to show them where they are now and where they'll be in the future procurement org and how they will be supported to be able to do those activities in future procurement org to really step up to meet the asks of today. Yeah. That's that's what I love about both of these reports is that there's a lot of emphasis on how procurement is evolving to a more strategic business partner function. So kind of expanding on that, Ryan, what what does that role look like in practice, and what are the top priorities for CPOs or a procurement organization? Yeah. And I think, Tricia did a great job of of of touching on this, and what she was just talking about. You know, in this survey, we did ask CPOs what they see as their top enterprise priorities, this year. And while not surprisingly, cost reduction was the number one answer. The next two answers, you know, have process and technology implications. So driving operational efficiency and digital transformation, including, generative and agentic AI. And then from there, the focus goes into a couple of interesting directions. The next two were supporting organic expansion and risk management, which are certainly, more strategic in in nature as you mentioned. I'll also note that we surveyed respondents really before the current tariffs were in place, and I think that's a yet another example of procurement expanding their aperture as a true strategic business partner and really being upfront in helping companies to deal with these business issues, and different risks that are coming up, on a regular basis. So, you know, CPOs, as we've been talking about, really have a lot of play, on their plate these days. And I think, yeah, largely as we've been saying, in a good way, but also in a way that's created some challenges for them. Yeah. And I know that you mentioned cost savings, but one of the things that your report also talked about is that there's other levers such as resilience and agility and growth. And I love this concept of digital masters. So how how are the ones that you're calling digital masters or really, how are they delivering on that value prop? So, you know, overall, Heidi, it's not just that CPOs are delivering value just beyond the typical cost savings. They're also doing better across a broader set of value measures compared to our 2023 survey. You know, working capital is one area that's up at 12%, in terms of procurement performance versus 2023. Cost avoidance up 8%. And even some of these other areas like innovation, up 10%, efficiency up, 7%. Other areas, you know, you talked about ESG is an area that they're getting involved in. So all of these areas that are, you know, core areas for procurement, some even, you know, maybe newer areas that CPOs are getting into, their performance has improved. And as I said, you know, this is pre pretariffs, so you don't have that impact showing up in these numbers. But that, again, is a huge additional responsibility on procurement's plate. You mentioned the digital masters, and that's one of the focus areas of the survey. We isolated companies that are doing this well, and they are called digital masters. These are the companies that are making the right investments, not only in digital and AI, but also, as Tricia was saying, in upskilling their talent. These companies spend more on technology and talent. They're more likely to have deployed things like advanced analytics and AI. And, overall, they're seeing better results from not only delivering higher cost savings, to spending more time on strategic activities and having greater business influence. And that really has resulted in higher higher ROI rather on their, their technology investments. So you can see that based on the survey findings, these digital masters, they're they're making the right bets, and they're getting the right payoffs from these bets. Yeah. And you mentioned ESG. ESG is is one of those key value drivers that, Coupa, you know, we monitor in our benchmark report. Tricia, how do you see leaders successfully tying in their ESG initiatives to their sourcing strategies or their corporate goals? Yeah. It it is quite the journey. I I do think ESG is a great example of where, procurement leaders are being asked to do things that they haven't had to do in the past. Right? They haven't been expected historically to find the right suppliers that are gonna help with the ESG agenda of the organization. But the reality of it is leaders across the across the suit c suite now understand that you really can't achieve an ESG agenda, your ESG goals, without understanding your third parties. Which third parties are you partnering with to provide goods and services to you that meet your ESG, objectives, but also what is their ESG agent and how does that contribute to your outcome. And and so it it's been one of those really interesting points for procurement where, historically, this wasn't a core function. But as organizations recognize that ESG agendas are dependent on third parties, procurement really have been put squarely in the middle. And the key to that is only possible if, one, they understand the suppliers. Right? That's the ones that can bring those products that are referenced or that have the right agenda themselves. And then through sourcing are able to weigh those suppliers against all of the other priorities. Is it it cost? Is it partnership? Is it risk? And all of the components, but to make sure across those components that the right suppliers are being surfaced for selection on the buying of individual items. Yeah. Good point. Obviously, that's coming from Roopa, you know, and we're we're anchored on technology. How does our AI native platform give CPOs that visibility and that spend control control that both of you are talking that's so important for CPOs? I mean, for me, the simple piece is data. I think I fundamentally as I drove the transformation of the procurement function in my previous role, the moment I understood that we weren't just applying technologies to standardize processes, but we were producing data in there as an output of that, that's when I fundamentally understood the value of the transformation overall. And within Coupa, we have, this incredible data moat across all of our customers, right, the Coupa community of data, $8,000,000,000,000 worth of transaction of historically contractually sourced anonymized data that we're able to build incredible AI on, whether it's historical AI. We all we all talk about AI like it's something that's only existed for the last year or two because we think of chat, g p t, and we think of agents. But if we actually look at, you know, AI and predictive and prescriptive, there are components built throughout the, the Coupa solution that absolutely are driving spend control and and visibility. Things like AI classification, which is looking at all of the spend of our customers and able to put it into into categorizations that really can start to spot where there are savings opportunities or or contractual consolidation opportunities. Or Coupa AI Spend Guard, which in real time is able to highlight to our customers, where a transaction may intentionally or unintentionally be flagging as fraud. And so there is this powerful dataset that when built on is in real time driving that differentiated outcome for our customers. Yeah. I know it wouldn't take long for us to talk about AI. It sounds like it's a core theme that all of us are talking about. Brian, when you're talking about digital masters, one of the things that your survey highlighted is that those digital masters are deploying GenAI at four times the rate of their followers and achieving 3.2 x, I believe, is what it was, the return on their investment. What do you think is driving that value? You know, I think part of it is, the fact that they're a little bit more advanced in terms of how they're thinking about, AI. That they're really getting ahead of the curve by building their own use cases with AI and then buying standalone solutions as part of that as well, as well. So they're not only looking at, you know, building their use cases, but they're also looking at, buying solutions at the same time. And they're doing this as part of a broader digital procurement strategy that really also considers how these solutions will integrate into their existing technology stack. So, you know, as Trisha was saying about data, and I think that's a great point. They understand that you need a core set of source to pay solutions that AI complements. AI can do a lot of of really cool things, you know, classification of spend data, can do some really cool things about developing, category strategies using market intelligence, autonomous sourcing. But you really need that strong foundation and good data to maximize what it can do. You know, I think intake and orchestration, which is really hot in the marketplace now is is a great example. That's something that can really help drive adoption, and the proper use, of SDP solutions. But it also does so by working with with those solutions and not completely replacing them. So you really need to have that foundation in place, and have, you know, good data in place to really maximize the return that you get from AI. And I think that's what sets these digital masters apart is that they're out in front and looking at the the use cases in building them out and experimenting and figuring out what works and what doesn't. But they also have, you know, better foundation, of technology and data that really helps to turbocharge the return that they get from their AI investments. Yeah. And if I may add on that, Heidi, just it's exactly what Ryan said, but I think one other key piece. Our all one additional piece is they know what problems they need to solve. When you have those foundations in place and you have data that shows you where immaturity is and you're you're key you have a clear view of what problems you need to solve. You don't have to be mature to know what your problems are. So at any level of immaturity, you can identify them. But knowing that allows you to ensure you're placing your bets in the right place with AI and agentic AI solutions because you are driving to business outcome, not just widely sweeping AI for the sake of an AI investment. Right. And, Brian, I heard you talk about autonomous sourcing. One of the things that Coupa is really driving towards is autonomous spend management. So we want AI AI agents to basically handle everything from sourcing to payments. Tricia, I don't know if you wanna expand on that, but how do you think capabilities like Koopa Navi are going to really represent that vision? Yeah. I mean, obviously, at highest level, Koopa's vision is to be the world's most effective two sided business to business network. Right? We wanna deliver value both to the buyers and the suppliers, not just efficiency. We need intelligence, resilience, and growth. And to bring that to life, we're we're looking at multiple different ways. Right? As we look at our road map strategy, we have to build, buy, and partner to to to really turbocharge the delivery of that value to our customers. At the heart of that is Coupa's Navi. Right? As as we've, highlighted, that's our our agent built into the solution and looking at specific use cases. And so there are a number of use cases already live, knowledge agent, there's the supply chain and network modeling agent that are are essentially executing the activities that the end user or the procurement function would be doing and doing it in a much faster way to get to that same outcome or even in some cases, slightly better outcome. As I look at this, roadmap for our agents, one of the conversations that I am having with our customers, and it goes back to the point that I just added on to, in the last one, It is less about I need an agent and more about really staying close to the agent road map, understanding what that agent's going to do. Because the agent's only going to be useful to you if it's doing something that's going to make you as a procurement team or your end user's job easier. And so, procurement team or your end user's job easier. And so on unlike what we've seen in the past, we need the procurement function to partner closely with their IT groups, but but we need the procurement function to to really be aware of what's coming and how the what's coming is gonna solve the business problems. Right? The agents will be adopted and immediately deliver value if you look at them with that lens. Yeah. And, Ryan, when you're talking to your prospects and your customers, how are you seeing people integrate AI or, you know, these types of, you know, things that we're talking about into their core processes? Yeah. It's really about, as Tricia was saying, you know, having the data, understanding where the where the problems are, and then having that broader strategic, roadmap for your procurement technology, for your digital technology, and then thinking about how AI can fit into, that technology architecture and the process architecture, and making sure that you are, you know, integrating or thinking about it in an integrated manner, from a process perspective and not just from a from a technology perspective. I think it's also important to think through as we've been talking about, you know, what are the sort of fundamentals that you need to have in place. So if you're thinking about a an agent, for example, and implementing that, and using that as a way to guide users to not only use the solution, but use it in the right way, you know, you have to think about, you know, do I have my policies well defined enough to really be able to design that agent in the right way so that it's very clear, you know, where it should be sending people in terms of, you know, contract, for example, or, you know, a buying channel and how to buy or, you know, preferred supply supplier as part of that buying channel. So it's important to not only think about that broader, you know, procurement, digital procurement, plan that you have and strategy and what that architecture looks like. It's important to think about how AI will fit into that, ultimately, from a technology and a process standpoint. But also just make sure that you've got all of those sort of foundational elements in place so that you can set up the AI in the right way and and really maximize the the value out of using it. Yeah. I mean, we're touching a lot on AI and and those agents, but let's kind of talk about the human component again. One of the things that I liked about the CPO survey is there was a powerful statement that said humans must be in the loop for these technology investments to succeed. You identify digital skills as the most pressing talent gap for CPOs. Do you see CPOs making an investment in their people as much as they are technology, or do you do you where do you see that balance between the human investment and the technology investment? Yeah. It's really important to to consider both, alongside each other. And and that's one of the, I think, the unique things about AI is that it, you know, it almost can do things, that it can do things that that people can do. Obviously, you need a human in the loop. It can't just take over everything. You need to validate what comes out of it. But it can take over a lot of, of what people are doing. And I think you need to think of it that way in that. You need to understand, how it will impact what people are doing today. And by, you know, freeing up the time, of your team, then how do you, upscale that team to take advantage of that and make sure that you're able to really step into more strategic value added activities, and let AI take away a lot of the the the busy work, that you're doing currently. And what we found in the survey exactly right, the other top skill gap, in the survey identified was digital skills, but number two was, was consulting skills. And what that tells me is that CPOs and digital masters in particular are are thinking ahead. And they're investing not only in the technology, but also in their teams and thinking through how they can improve the skills of their teams and upscale them in a way that will allow them to take on, you know, more work in engaging the business, for example, convincing people in the business, to do things differently, as a way to drive savings through demand management. And we did find, as I mentioned, that the digital masters, you know, they're investing more not only in technology, but they invest more in in talent as well. And they invest more in really thinking through how they, you know, not only automate processes, but automate processes in a way that does free up time for people. And then at the end of the day, as Trish was saying, produce more, better data for better insights. So you get that loop, coming out of your systems that allows you to get that better visibility into insights and doing a a better job, of sourcing, managing suppliers, managing risk, etcetera. Yeah. I guess that comes down to this digital literacy, which I think I read in in your report. Right? That, is basically the skills that we should be focusing on in in this world of AI. So so let's let's move a little bit into measurement and derisking things. So, Tricia, I always joke about you can't kind of like our weight. You can't you can't manage what you can't measure. The benchmark report is that in our procurement space, which has 20 specific KPIs. Can you talk a little bit about some of the examples of those KPIs that folks can use to create a baseline as they look across their their processes? Yeah. I mean, it it is it is such an obvious statement. We can have aspirations, but if we don't measure them, we won't actually see, we won't actually see a shift. And so I do think and I I kind of alluded to this earlier. My message to customers fundamentally, we we're never all going to be great at every single one of those KPIs, nor do we need to be. Regardless of of whether we're starting out and or well on the journey, we really do need to focus on a few things, make progress, and and then communicate that and then continue to move up the maturity curve. I do, as I look at this, I think the reality of it is and it comes back to the to the great point that Ryan was making, you know, when we talk about talent. We need to really recognize that the point of implementation is only the beginning of the journey. I actually like to think that that's the foundation. And far too often when we do massive technology or, digital transformations, we tend to, like, clap our hands and celebrate at the point of deployment. For me, that's just when things get good. Right? You've accomplished something through the deployment. You've definitely moved your KPI in some way, but you have very rarely, got it as far as it could get. And and if you don't put an investment from a people standpoint into sustaining it, it not only won't grow, it'll likely fall backwards. And and so really recognizing that having a team in place that understood what the original business case new deployment was and are invested in continuing to manage that KPI and understanding not only what the technology does today and how would you leverage it, it might solve your problem, but understanding what's coming and how it might leverage, or or solve your problem. I'm really focused as we look at our releases and our, Coupa, the items that have come out in the three releases a year. How do I make it as simple as possible for every practitioner out there who's a current customer to understand what's coming and how that particular item or five of the particular items are going to help them with the KPIs they're trying to move? But that mindset only happens if that measurement and and and the recognition we're gonna stay focused on the measurement and is the is the beginning point. Yeah. Agreed. Well, I know that we're coming close to the end of our conversation. Unfortunately, there are so many other things that I want to talk about. But, Ryan, what about your just your final thoughts? We discussed how CPOs are becoming agents of change. Is there anything that you would suggest to procurement leaders that they should consider doing? Yeah. I I think, you know, a lot of it is about what we've been talking already, around, you know, not just the technology focus, but also thinking about, you know, readiness for what's coming, and embracing not only the, you know, digital and AI and having a plan in place that covers that, but also considering what does that mean for your operating model, and the impacts that technology will have on the operating model. And and how do you think about that in a way that will allow you to get the most, out of AI? The CPOs I find who are the most forward thinking understand that that, AI can truly augment their teams, you know, almost in a way that, you know, getting more headcount to do, not quite, but sort of that similar sort of mindset. But only really if they help their teams take advantage of what AI has to offer and put their teams in a position to succeed, when they have AI in place. One of my favorite quotes that I've heard before from a CPO was that in procurement, you need to be able to sell more than you buy actually. And I think that's what we're gonna start to see is, you know, procurement organizations, CPOs really thinking about how do we take advantage of what AI has to offer in freeing up the time of our teams and then making our teams much more focused on, you know, not only delivering cost savings, through, you know, sourcing, and, you know, the supply markets, but also selling procurement internally, to the business and getting people in the business to change the way that they do things because that's how you deliver that incremental value down the road. Yeah. I agree. Tricia, anything for for those that are ready to move from strategy to execution, where do you think that they should get their start to create the biggest impact? Yeah. Sorry. I'm even before I answer that, I am I'm still smiling at Ryan's last point because I couldn't agree more. Unlike HR or legal in an organization or maybe finance, you you have to go through them to get to the outcome. That's not always the case with procurement. Let's be honest. More often than not, it's not. And so you have to do exactly what what you're saying, Ryan, which, you know, makes me smile. Because, honestly, it was a full time job, within my within my scope to try and continue to to speak to the value. But sorry, Heidi, on your question. And I I do think I mean, if you're if you're really looking to move from strategy to execution, it is focused on the outcome. And sometimes it's not your outcome. It's not the number one thing you, the procurement leader, believe needs to be addressed. It is from conversations with your business partners, actually back to that selling point. What do they think needs to be addressed? And so recognizing the problems that they believe need to be addressed and making progress against them and then communicating that progress. That's one. And then the other one I would say is I would encourage our, encourage procurement functions to actually keep looking at what's within the tech they might already have. I've actually been surprised at how many customers I've been talking to, where I'm highlighting features and functionality that are just core to the system that they weren't all aware of. The ones that are and are using them are getting incredible outcomes from it. And but I would encourage you to have those deeper looks at what is in the solutions that you already have and how can they help you on that journey because sometimes you can take advantage of things and not significant investment is even needed. So that's my kind of think of when you're moving from strategy to execution. But but but even more importantly, don't forget that when you start to execute and see results, make sure you're telling people about it. Yeah. I love it. Well, thank you guys so much for your time today. It was a great conversation. For everybody that's listening, if you wanna learn more about these two reports, please download the full Deloitte 2025 global CPO survey, and the Coupa total spend management benchmark report will provide those links for you. Sorry we didn't get a chance to answer everybody's questions, but we will be following up. So on behalf of Coupa and Deloitte, thank you very much for joining us today. Have a great rest of your day. You too. Thank you.