Case Study
Digital Transformation Optimizes the Agriculture Procurement Ecosystem
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.
Current Challenge
The Problem – Non-Digitized Procurement Routines
The continued reliance on outdated procurement tools and processes creates a cascade of problems and inefficiencies, including:
01
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.
02
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.
03
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.
04
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.
05
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 Solution
Digital Procurement Management
- Vendor qualification
- Contract development
- Performance management and corrective action
- Forecast creation and validation
- Warehousing and inventory management
- And more….
- 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 Impact
Business/Operational Impact
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. 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.