Why Banks Should Focus On Digitizing Procurement To Manage Costs And Reduce Risk

By Falk Rieker, Global Vice President and Global IBU Head for banking at SAP

It’s not easy to thrive in today’s banking industry, especially when every year they must do more with less. As the pandemic has evolved, we’ve seen banks reduce the number of physical branches while increasing the number of digital customers, channels, and tools. As more banking processes move online, the complexity multiplies.

But banks still have opportunities to save money and reduce risk through digital transformation in procurement.

For example, I was recently speaking with one banking executive about his company’s need to reduce costs and gain visibility into spend across the organization. Because the bank was well into its digital transformation journey, he was sure that it had a solid plan in place to take advantage of cost-savings opportunities. In fact, the bank continually refines its plan to meet the changing business climate, now that inflation is also a factor.

Digitized Procurement Drives Benefits

Our conversation shifted to the bank’s procurement processes. Many banks still have siloed procurement teams positioned throughout their business – with different personnel, tools, policies, and governance in corporate banking, retail banking, global wealth management, and so on. These firms view procurement strictly as a tactical process, one that can help standardize supply processes and possibly reduce costs.

Source: Forbes

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