Digital Transformation Optimizes the Agriculture Procurement Ecosystem
The Industry Challenge
Operators in the Agriculture industry face a host of challenges in management of procurement processes that are complex and diverse. Those challenges are compounded by the fact that many companies still rely on legacy tools and processes that are siloed, self-limiting, non-intuitive, and opaque.
Worldwide, Ag companies are looking for digital solutions that will bring automation and intelligence to bear on existing inefficiencies within their procurement routines. This digital transformation will have far-reaching implications on their ability to secure products (fertilizer, packaging, equipment, etc.) at competitive pricing, at required levels, and with predictable delivery.
The Problem – Non-Digitized Procurement Routines
The continued reliance on outdated procurement tools and processes creates a cascade of problems and inefficiencies, including:
|Non-optimized vendor qualification: Many Ag vendor qualification processes are non-automated, worksheet-based, and non-evolving. This creates wide gaps in process visibility, causes delays in processing of critical data, complicates customer to vendor communication, and increases the possibility of qualifying a problematic supplier.
|Inaccurate demand forecasting: The accuracy of procurement forecasting is limited by continued reliance on manual tools that are self-limiting and non-communicative. Moreover, legacy forecasting methodologies do not support the quick response times necessary to react to today’s volatile market conditions. Overorder or underorder is a common problem that negatively impacts inventory levels and undermines overall financial performance.
|Pricing/contract negotiation: Price setting and contract negotiations are cumbersome, non-interactive, and prone to error. The lack of integrated digital solutions limits the availability and utilization of real-time data required to assess factors such as market trends, vendor costs, transportation costs, etc. Handling of contract documents are manual and time-consuming.
|Shallow vendor performance observability: Many Ag companies lack deep, real-time, observability into the performance of their vendors. KPI (Key Performance Indicators) are reported too infrequently and do not provide the level of dynamism required to accurately assess, visualize, and report on performance. Critical performance issues are not detected until significant delays have been incurred.
|Spend allocation management: Inability to create custom analytics and reports to monitor real-time vendor spend data. Prolonged delays in assessment of actual vendor spend dollars vs targeted allocations increases the risk of becoming too dependent on one or two suppliers.
The cumulative effects of these problems can be devastating and long-lasting. High costs, ineffective utilization of procurement resources, an unstable vendor base, unbalanced vendor spend allocations, dissatisfied customers, and loss of market share can all be side effects of poor vendor management.
The Solution – Digital Procurement Management
Ag companies need a solution that provides full visibility and control of the entire procurement ecosystem. Plasma provides a self-contained digital Procurement Management solution supported by digital technologies.
Intelligent workflows: Legacy BPM solutions were yesterday. Intelligent workflows are today. Plasma couples AI and ML technology with workflow automation solutions to produce intelligent workflows that are dynamic, intelligent, transparent, and self-governing. These workflows can be applied to all critical processes within the Ag procurement ecosystem.
- Vendor qualification
- Contract development
- Performance management and corrective action
- Forecast creation and validation
- Warehousing and inventory management
- And more….
Analytics and visualization: Plasma’s AI-enabled analytic tools provide capabilities that move procurement data analysis beyond the boundaries of data snapshots and into the realm of “learning” and predictive analytics. Customizable drag and drop dashboards empower business stakeholders to quickly consume copious amounts of data and gain deep insight into real-time procurement processes and initiatives, including:
- Purchase behavior at micro and macro levels
- Vendor qualification status
- Contract negotiation status
- Vendor performance analytics
- Real-time and predictive margin analysis
- Spend allocation status
- And more…..
The Ag industry is primed for digital transformation. Plasma’s Ag-focused suite of digital transformation solutions will enable Ag companies to transform their procurement routines to achieve maximum observability, dynamism, reliability, and financial impact.
|Vendor Qualification||Manual, worksheet-based, visibility gaps, prone to error||AI-enabled, self-learning, automated processes that fully optimize vendor qualification and promote vendor/supplier collaboration|
|Inaccurate Forecasting||Lack of predictive analytics limits forecast horizon as well as near-term precision||Historical analysis and predictive analytics significantly improve forecast accuracy and delivery performance|
|Pricing and Contracts||Manual process and lack of real-time market insights creates miscalculation and loss of margin||AI-enabled intelligent workflows provide enhanced control and real-time market visibility that improve outcomes|
|Vendor Performance Management||Non-automated processes and static analytics limit insights into current and future vendor issues||Real-time analytics and at-a-glance dashboards provide data needed to mitigate performance issues and maximize performance|
|Spend Allocation Management||Delays in assessment of actual vendor spend dollars vs targeted allocations increases the risk of becoming too dependent on one or two suppliers||Dynamic spend allocation KPI reporting and automated workflows provide rapid recognition and response to spend allocation issues|
You can’t plan if you can’t predict, and you can’t respond if you can’t see. Plasma digital transformation of Ag procurement routines will result in increased process visibility, improved forecasting, greater market awareness, less risk, and improved bottom lines.
View our other recent case studies: