How Does Operational Procurement Work In 2021?

Juliet D'cruz

Updated on:


The process of operational procurement enables purchases to be made by professional organisations that will be used either in the office, for sales and distribution purposes or for use in production.

The bigger a company is, the bigger benefits it will receive from the application of best practices in regards to purchasing, but even small businesses should make use of these processes as they are very much to their advantage.

The same office supplies will likely be required by two completely different offices, and the same applies to raw materials used in production processes by different plants in different parts of the world. In some instances the same consulting services may also be required for a completely new project. 

In every one of these instances the application of best practices in the purchasing department allows the company to make a number of savings.

Supply chains were significantly disrupted in 2020, and the pandemic continues to have an impact on procurement processes. Businesses are now trying to work out not just how to adapt but how to move forward, often with the aid of new technology and software, and there are a number of trends that have changed the way operational procurement works in 2021. 

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Risk management

Risk management has never been of greater importance in operational procurement than it is in 2021, as businesses continue learning the lessons from the pandemic. One procurement trend for this year has been making risk one of the biggest priorities throughout the whole of the procurement process, beginning with comprehensive risk assessment of every procurement process and the creation of contingency plans such as the establishment of trustworthy backup suppliers and optimisation of inventory. 

AI in procurement

Artificial Intelligence is transforming and unifying operational procurement, from demand planning to accounts payable automation to spending and contract analytics. Many procurement software platforms are now making use of machine learning algorithms in order to organise unstructured cost, contract, and spending and supplier data. 

AI is also being used to cut down procurement workload with the use of chatbots to answer many queries from suppliers, deal with low-value transactions, track payments and invoices and chase and send orders. AI can also be of assistance with finding and short-listing potential suppliers and monitoring their performance on a number of crucial performance indicators. 

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Advanced analytical capabilities

A tremendous amount of data is handled by procurement teams every day, and there are platforms that can help to have this data converted into actionable insights by streamlining the end-to-end procurement process and ensuring that data is unified across all departments. Data analytics also allows procurement to work out likely scenarios for future problems and make plans to mitigate their effect on the business. 


RPA (Robotic Process Automation) is software that is able to recognise and learn patterns while performing rule-based tasks, and in procurement this software is able to be leverage for the automation of repetitive and monotonous tasks within these processes, resulting in a reduction of costs, greater efficiency and an improvement in both compliance and accuracy. 

Operational procurement will have to continue to adapt to ongoing challenges in our society, and the use of software has helped businesses to ensure they have been able to succeed in 2021.