Implementing Industry 4.0 technologies: Future roles in purchasing and supply management
Vincent Delke, Holger Schiele, Wolfgang Buchholz and Steve Kelly
About the main author
Vincent Delke is an assistant professor at the University of Twente. His work focuses on the impact of technology on the field of purchasing and supply management. Therefore, he addresses how recent technological change impacts the supply chain, supply risk management, buyer-supplier relationships, innovation, procurement organisations, and processes. His recent work studies the future skill requirements and roles of purchasing professionals within a future industry paradigm, Industry 4.0. Also, he analyses future methods to educate the needed purchasing and supply management skills to achieve lifelong learning in the field.
Short abstract
Technological advancements associated with Industry 4.0 drive a paradigm shift with economic and social consequences where digitalisation, robotisation, and other emerging technologies reshape the interconnection between organisations. Critical areas that need to adapt to the change are inter-organisational buyer-supplier relationships managed by Purchasing and Supply Management (PSM) professionals. Therefore, their future responsibilities and skills are likely to change. By introducing the concept of specialised roles to summarise needed competencies, this research conducted a real-time Delphi study using an internet-based platform involving 47 procurement experts. As a result, the roles of the Data Analyst, Master Data Manager, Process Automation Manager, Supplier Onboarding Manager, System Innovation Scout, and Legislation Specialist were identified as essential Industry 4.0 PSM roles. Further, for these roles, the probability of their occurrence, industry impact, desirability, and level of industry adoption are assessed. Based on emerging technologies in PSM and adopting a human-centred perspective, this research shows the need to focus on talent development to enable a technology-driven revolution. Thus, the contributions lay in the literature on Industry 4.0 and the PSM skills and capabilities domain, highlighting the required roles for Smart Working and effective Smart Supply Chain Management as parts of the digital transformation journey.
Extended abstract
This paper explores the impact of Industry 4.0 on Purchasing and Supply Management (PSM) roles, focusing on the emergence of new professional roles within this context. The study identifies six roles: Data Analyst, Master Data Manager, Process Automation Manager, Supplier Onboarding Manager, System Innovation Scout, and Legislation Specialist. The research emphasises the increasing strategic importance of PSM in organisational performance. Thus, the study suggests that the evolution of technology may support the shift from generalist to specialist roles within PSM.
The Data Analyst role, for instance, involves expertise in data analysis and system infrastructure familiarity, supporting PSM projects, and strategic decision-making. The role may be implemented within a shared business intelligence department or as a resource in purchasing category management, depending on the size of the buying organisation. Other roles, such as the System Innovation Scout, may emerge due to the increasing availability of technology in the procurement domain. The System Innovation Scout is responsible for identifying future PSM systems based on the needs of the department and available solutions, representing a boundary-spanning role between internal capabilities and external solution providers. Further details on these emerging roles in PSM can be found in Table 1.
Table 1: Identified future roles in Purchasing and Supply Management
Role | Description | Rational |
Data Analyst | "The Data Analyst in purchasing is responsible for extracting and analysing purchasing data to support preparing commodity strategies and complex purchasing projects." | · Amount of data in PSM increases due to the implementation of (Industry 4.0) technologies · Utilising artificial intelligence |
Legislation Specialist | "The Legislation Specialist in purchasing is responsible for ensuring that digital purchasing processes and sourcing projects comply with any relevant laws and regulations, including their implementation into the purchasing systems." | · Privacy and security of data is a major concern in Smart Supply Chains with high data exchange stakeholders · Increasing data privacy and security requirements |
Master Data Manager | "The Master Data Manager in purchasing is responsible for the alignment between the physical and digital world and ensuring data correctness and up-to-dateness." | · Advanced systems require experts to manage the alignment between multiple systems and the flow of data · In Industry 4.0, the role enables cyber-physical systems and digital twins |
Supplier Onboarding Manager | "The Supplier Onboarding Manager in purchasing is responsible for setting up the digital interface between the buying firm and suppliers, involving the harmonisation of data and effective stakeholder communication." | · Important to build a Smart Supply Chain and utilise more technologies in the buyer-supplier interface · Smart Supply Chains require flawless connections · Particularly needed during supplier integration |
Process Automation Manager | "The Process Automation Manager works at the interface between purchasing and IT, responsible for implementing and operating RPA tasks within purchasing." | · Process automation will allow PSM professionals to work smarter and focus on value-adding activities · Autonomous systems perform activities without human intervention |
System Innovation Scout | "The System Innovation Scout is responsible for identifying and implementing new Industry 4.0 technologies or systems within purchasing." | · e-Procurement systems are complemented and replaced by advanced information, communication, and connectivity technologies · Technology reduces human involvement and enables Smart Supply Chains |
Chief Happiness Officer | "The Chief Happiness Officer in purchasing is responsible for change management during system automatisation and ongoing caretaking of human needs within a digitised working environment." | · A person responsible for human needs during the change process is required in Industry 4.0 |
The study recommends future research on a larger scale to enhance generalizability, exploring how suggested roles can be implemented in organisations. Micro-level research should identify skill sets for each role, guiding HRM and education efforts. Additionally, macro-level research should examine the impact of these roles on organisational structures and talent distribution within the procurement function.
The paper also suggests assessing roles with a maturity assessment, recognising that not all roles may be implemented in all PSM maturity stages. The importance and combination of roles will depend on organisational characteristics, objectives, and the availability of technology. The study encourages further research on the broader impact of the next generation of Industry 4.0 technologies beyond the scope of this paper. However, the paper acknowledges limitations, such as the reliance on the Delphi method, which is based on expert opinions and may not fully represent reality.
Additional/further reading
· Link to the article (open access): https://www.sciencedirect.com/science/article/pii/S0040162523005322/pdfft?md5=2e002d08648f4dedff1c53098b2158f3&pid=1-s2.0-S0040162523005322-main.pdf
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· Website: https://www.utwente.nl/en/bms/el-ips/