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A finance maturity assessment is the best way to gain a comprehensive understanding of the financial health and position of your company and operations.

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Adding value to the construction industry by transforming procurement

At Kronos Group, we give you expert-led insights to elevate the efficiency and success of your construction business by helping you restructure your procurement framework.

A study conducted by the Chartered Institute of Building (CIOB) revealed that more than 87% of executives at leading construction companies singled out an efficient procurement function as the primary driver for success.

These figures are not surprising given that the construction industry has become increasingly dependent on sourcing quality materials on time to deliver higher quality and efficiency in all its projects.

While there have been many concerted efforts from construction companies and raw material suppliers to streamline the procurement function, the implementation of these efforts has left a lot to desire, with many construction companies not experiencing the gains they anticipated. 

As the world shifts away from traditional methods of doing business, construction companies must account for the needs of the modern landscape to make their procurement function truly efficient. Today, this comes down to transforming procurement.

So, what does it take for businesses to start reshaping procurement?

The key is continuous improvement. This ensures that procurement is optimised for greater efficiency. As it happens, transforming procurement is the best way to launch a long-term system of adding higher value to business processes.

Our team of professionals at Kronos Group adds value to your critical business functions through targeted, practical, and efficient strategies to reshape procurement.

Is your procurement strategy ready for upcoming EU regulations?

The procurement landscape is evolving, with stricter regulations reshaping business operations. The regulatory shift: What is changing? Businesses must now prioritise transparency, ESG reporting, and digital transformation. What are the biggest challenges in procurement management? Companies face supply chain risks, compliance burdens, and the struggle to balance costs with regulatory demands. How to stay ahead of compliance through a procurement strategy? Regular audits, supplier collaboration, and digital solutions are key. What is the business case for compliance? Beyond avoiding penalties, compliance strengthens supplier relationships, enhances sustainability credentials, and builds stakeholder trust—turning regulation into a competitive advantage.

The procurement landscape in the EU is continuously evolving, with stricter regulations ensuring fairness, transparency, and accountability. For organisations operating in both public and utility sectors, aligning with key directives—Directive 2014/24/EU and Directive 2014/25/EU—is not just a legal requirement but a critical component of a robust procurement strategy.

Failure to comply could lead to penalties, legal disputes, and reputational damage. As procurement professionals navigate these complex regulations, integrating compliance into their procurement management strategy is essential to mitigating risks and maintaining operational efficiency.

The regulatory shift: What is changing?

The European Commission is reshaping procurement to be more strategic, sustainable, and transparent. With six key priorities guiding this transformation, organisations must adapt to stay compliant and competitive:

Wider adoption of innovative, green, and social procurement – Encouraging procurement practices that align with environmental, social, and governance (ESG) goals.

Professionalising public buyers – Equipping procurement professionals with the skills and tools to make informed, strategic decisions.

Improving market access – Ensuring SMEs and cross-border suppliers have equal opportunities to compete.

Increasing transparency, integrity, and data-driven decision-making – Strengthening oversight and accountability in procurement processes.

Accelerating digital transformation – Streamlining procurement through e-procurement and digital tools.

Enhancing collaborative procurement – Encouraging joint purchasing efforts to drive efficiency and cost savings.

Beyond these priorities, businesses must also navigate evolving regulatory requirements such as:

ESG reporting: Stricter sustainability and corporate responsibility disclosures affecting procurement decisions.

Supply chain due diligence: Increased scrutiny on ethical sourcing, human rights, and environmental impact within supply chains.

These changes are not just policy updates—they redefine how organisations approach and view procurement management. Neglecting regulatory compliance could lead to severe financial penalties, contract loss, and reputational damage. More importantly, companies that fail to adapt risk falling behind in an increasingly competitive and regulated market.

By aligning procurement strategies with these evolving regulations, businesses can turn compliance into an opportunity—driving innovation, sustainability, and long-term success.

What are the biggest challenges in procurement management?

As procurement evolves, businesses face mounting pressures to comply with regulations while maintaining efficiency and cost-effectiveness. However, many struggle with fundamental challenges that can put them at risk.

Lack of supply chain resilience

With disruptions becoming the norm, resilience is critical—but many organisations are unprepared. A recent survey found that only 57% of companies have a supply chain risk mitigation plan, leaving them vulnerable to geopolitical shifts, climate events, and supplier failures.

For example, the global semiconductor shortage exposed the fragility of supply chains, halting production for industries from automotive to consumer electronics.

Supplier transparency and compliance risks

Ensuring suppliers adhere to ethical and regulatory standards is a growing challenge. A survey revealed that 60% of procurement leaders see a lack of transparency as a major risk. With ESG regulations and supply chain due diligence laws tightening, companies must have full visibility into their suppliers’ practices—or face penalties.

The EU’s Corporate Sustainability Due Diligence Directive (CSDDD) requires companies to assess human rights and environmental risks across their supply chains, with non-compliance leading to fines or legal action.

Compliance tracking and reporting burdens

Regulatory compliance demands extensive tracking and reporting, but many organisations lack the necessary systems. From ESG disclosures to procurement data management, the complexity of meeting multiple regulatory frameworks can overwhelm procurement teams.

For example, under the EU Taxonomy Regulation, businesses must classify their economic activities based on sustainability criteria, adding layers of reporting complexity.

Balancing cost pressures with regulatory demands

Regulatory compliance often requires investments in sustainable sourcing, ethical labour practices, and digital transformation. Yet, procurement teams must balance these costs against budget constraints and competitive pricing pressures.

For example, businesses in energy-intensive industries face rising costs due to carbon reduction requirements while still needing to maintain profitability and competitive pricing. 

The growing complexity of procurement means businesses must rethink their strategies. Investing in data-driven decision-making, supplier risk management, and digital transformation will be key to overcoming these challenges while staying ahead of evolving regulations.

What is the business case for compliance?

Compliance is often seen as a regulatory burden, but in reality, it is a strategic advantage. With the average cost of a supply chain disruption reaching $310,000, the financial risks of non-compliance are too significant to ignore.

Elevate your procurement strategy with Kronos Group

Is procurement operations management still relevant in the age of AI?

AI is enhancing procurement operations management by providing capabilities such as automation, predictive analytics, and real-time risk assessment. However, there are several things AI cannot do in procurement operations management, like handling negotiations, understanding context, and making ethical decisions. As the role of procurement operations management is shifting from transactional tasks to strategic decision-making, professionals must adapt by strengthening their skills in data literacy and relationship management. To prepare for the future ahead in procurement management, organisations must integrate AI with human expertise. Ultimately, procurement operations will always matter, as human insight remains crucial to strategy.

AI is here to replace us—or is it?

With 96% of organisations already using AI in their procurement processes, the technology is no longer a future concept—it is a present reality. The hype is undeniable, but so are the concerns. Will AI make human roles redundant, or is it simply reshaping the way procurement operates?

The truth is, that procurement operations management is evolving, not disappearing. Yet, despite AI’s rapid adoption, only 30% of procurement leaders report being very satisfied with their current AI solutions. While technology is advancing at an unprecedented pace, many organisations struggle to harness its full potential.

This gap between adoption and satisfaction presents an opportunity. According to recent research, the key to success lies in how leaders leverage the latest developments to improve procurement efficiency, drive strategic decision-making, and enhance overall satisfaction.

Let’s explore how AI is transforming procurement—and how organisations can close the satisfaction gap.

What are the capabilities of AI in procurement operations management?

AI is not just crunching numbers—it is transforming procurement as we know it. Imagine a system that can predict supply chain disruptions before they happen, identify cost-saving opportunities in seconds, and automate tedious manual tasks with pinpoint accuracy. That is the promise of AI in procurement, and it is why 95% of organisations plan to increase their investment in AI over the next three years.

Right now, AI is making waves in three key areas:

Automation that frees up time

AI is handling everything from purchase order processing to contract management. No more chasing approvals or sifting through paperwork—machines are doing the heavy lifting so teams can focus on strategy.

Predictive analytics that see the future

AI is not just looking at past data; it is forecasting trends, spotting risks, and helping procurement leaders make proactive decisions. Imagine knowing supplier delays before they happen or predicting price fluctuations before they hit.

Risk assessment that never sleeps

AI scans supplier networks in real-time, identifying potential compliance issues, geopolitical risks, and financial instability. It is like having a 24/7 risk radar, ensuring businesses stay ahead of disruptions.

AI is powerful, yet many organisations still struggle to unlock its full potential. While it automates and analyses at remarkable speed, it can sometimes fall short in areas that require human intuition, adaptability, and strategic thinking. This is where the gap between adoption and satisfaction begins.

So, where is AI missing the mark, and how can organisations bridge the gap? Let’s dive in.

What AI cannot do in procurement operations management?

AI is an incredible tool, but it has its limits. While it excels at processing data, predicting trends, and automating workflows, it falls short in areas that require human judgment, emotional intelligence, and ethical reasoning. Here are three key areas where AI still needs human expertise.

The art of negotiation: Why machines cannot replace relationships

Imagine walking into a high-stakes supplier negotiation. The AI has crunched the numbers and determined the “perfect” contract terms. But the supplier hesitates. There are unspoken concerns, subtle shifts in tone, and a history between both parties that no algorithm can fully grasp.

This is where procurement professionals thrive. Negotiation is not just about price points and contract clauses—it is about trust, persuasion, and understanding the nuances of human interaction. AI can assist by analysing past negotiations and suggesting strategies, but it cannot build relationships or navigate the grey areas of a deal.

Perhaps that is why 57% of leaders say prioritising AI in procurement use cases is their biggest challenge. The technology is powerful, but knowing where to use it—and where not to—makes all the difference.

Context matters: When human judgment beats AI predictions

AI sees patterns in data, but it does not understand context the way humans do. Take, for example, a sudden price drop in raw materials. AI might flag it as an opportunity to buy in bulk. But a procurement expert, with industry knowledge and human intuition, might see the bigger picture—perhaps the price dip is due to a temporary oversupply, and waiting a few weeks could yield even greater savings.

Or consider supplier selection. AI can rank suppliers based on price, delivery speed, and compliance history. But what about a supplier’s long-term reliability? Their reputation in the industry? Their ability to innovate alongside your business? These are factors that 58% of procurement leaders say AI can help uncover deeper insights into—but only when paired with human decision-making.

Experience transformative procurement operations management with Kronos Group

AI is not replacing procurement—it is redefining it. The question is not “Will AI take over?” but rather “How can procurement leaders shape the future with AI as their ally?” The answer starts today.

Can financial services prepare your business for the next crisis?

Financial services may be a somewhat vague term used to refer to a broad spectrum of opportunities and possibilities presented by finance, but its purpose is critical and nuanced. 

What is the purpose of these services? Finance is the main driver of economic development for countries and businesses alike, which means understanding and monitoring the sector should be a key area of interest for any business looking to survive in the competitive, global market.

What does a robust financial function mean for your business? Financial success is not limited to positive bottom-line figures and profitability. It also helps mitigate business risks through a crisis, set higher goals, maintain more sustainable growth, and focus on higher value addition.  The value specialised services can bring to your crisis management: Because no two crises are alike, it is impossible for a business to prepare for every possible scenario. What a company can do, however, is put a resilient crisis management and recovery process in place for easy deployment. A finance consultant can help you put together a suite of finance services from finance transformation to finance training to ensure that your business model is fortified by the right tools for financial success on an accelerated timeline.

The phrase ‘financial services’ is a broad term that refers to a vast field, which is as old as businesses themselves. When we discuss services in the finance field, we are discussing the various offerings within the industry from money management to investment, and all the technology that accompanies them.

What is the purpose of financial services?

From personal capital to a country’s central bank, finance and its services support our daily lives in invisible ways. It is, after all, the primary driver of any nation’s economic development.

Finance hosts a range of possibilities and has displayed massive propensities for growth and development, not just within the financial sector but for every sector of the economy. 

The vast range of possibilities available in finance is clear from the results of a 2019 survey to determine which sectors financial services companies worldwide are planning to collaborate with. 76% of respondents stated that finance service companies were looking to collaborate with other finance companies. 

The vitality of the financial sector is not up for question. Because of the critical position finance holds, it is no secret that it holds a similarly significant position in the success of a company, especially when faced with a crisis. 

While this is a fact that cannot be called into question, what remains a process of trial and error, for many companies across the world, is how finance operations can be optimised to hold up against crises—and how services in the finance sector can help.

What a robust financial function will mean for your business

The flow of resources and capital that finance oversees is the lifeblood of your business.

When your resources and capital are moving freely, actively reducing wastage, and maximising quality and productivity across the board, the advantages to your business go beyond higher profit margins and bottom-line figures. 

A strong financial arm helps you drive higher growth and set more specialised goals and targets. You will also have more resources to invest in higher-value addition, such as training programmes and better supplier relationships. On top of these advantages, the proper management of finance also helps you mitigate risks that are an everyday part of any business. 

The existence of a theoretically sound financial system, however, is not enough to yield these benefits. These advantages are only possible when you are committed to the continuous optimisation, and improvement, of your financial sector. 

In the contemporary landscape with its cutthroat competition and numerous risks, the help of external finance services can be indispensable.

The value specialised services can bring to your crisis management

It is impossible for a company to anticipate every crisis and it is unrealistic to believe that there is a methodology you can follow to ensure that your business operations do not suffer any loss, or need to change in any way to accommodate this new environment. 

What your business can do is put together a crisis management plan and crisis recovery strategy. These steps help your company, in the aftermath of a crisis, to leverage the changes that need to be made swiftly enough to ensure that the harm to your productivity and profitability is minimised. 

No two crises are alike, but in order for a business to survive any of them, the full optimisation and efficiency of the finance function are necessary. 

Procurement In The Service Industry: Role And Future Trends

Procurement plays a crucial role in ensuring that the right materials and services are obtained at the right price, quality, and time, supporting the overall success and efficiency of the business. Procurement can involve purchasing raw materials, equipment, or even outsourced services, and it works closely with other departments like finance, operations, and marketing to ensure alignment with business objectives.

The Global Procurement As a Service (PaaS) market is expected to grow from US$ 7.03 billion in 2024 to US$ 15.12 billion by 2031. This growth is driven by businesses seeking to optimise their procurement processes, reduce costs, and streamline operations through outsourcing.

Procurement has traditionally been seen as a back-office function, with little visibility or involvement in strategic decision-making. However, this perception is changing, as businesses increasingly recognise the value of procurement in driving cost savings, innovation, and operational efficiency.

In the service industry, procurement faces unique challenges such as the need to manage a diverse supplier base, ensure the quality of intangible services, and navigate the complexities of service contracts. Despite these challenges, procurement is vital in maintaining service quality, managing supplier relationships, and ensuring cost control, ultimately contributing to the success and sustainability of the business.

A significant 74% of supply chain leaders have increased their investment in supply chain technology and innovation. This trend reflects a broader shift towards automation and data-driven decision-making, helping procurement teams optimise sourcing, improve efficiency, and reduce risks in the supply chain. As businesses face increasing pressure to adapt to changing market conditions, leveraging technology becomes a key enabler of success.

Understanding procurement in the service industry

In service-focused businesses, procurement is crucial for ensuring the continuity of operations, optimising service costs, and maintaining high standards for customer satisfaction. It involves a wide range of activities, from outsourcing IT support to negotiating contracts for marketing services or facility management.

Effective supply chain risk management is essential for any business, but in the service industry, it has an even greater impact on company brand value. Research shows that robust risk management in the supply chain can deliver over 70% additional value to a company’s brand. By proactively identifying potential disruptions—whether from suppliers, geopolitical factors, or market shifts—companies can protect their reputation, ensure consistent service delivery, and avoid costly disruptions that could harm customer trust.

Key differences between procurement in the service industry vs. manufacturing or retail

Intangibility: Unlike physical goods, services are intangible, which makes it more challenging to define and measure the quality of what is being procured. Procurement in the service industry often focuses on evaluating the skill set, experience, and reliability of service providers rather than product specifications.

Long-term relationships: Service procurement typically involves long-term relationships with service providers, particularly critical services like IT support, logistics, or facilities management. In contrast, procurement in manufacturing or retail might be more transactional, focusing on purchasing raw materials or finished goods.

Customisation: Service contracts often require more negotiation and tailoring to specific business needs, while manufacturing or retail procurement typically involves standardised products. This requires a deeper understanding of business processes and often a closer collaboration with suppliers in the service sector.

Risk management: Procurement in the service industry must navigate risks related to service delivery, including performance issues, compliance, and legal considerations, whereas in manufacturing or retail, the focus is often on managing the availability and quality of raw materials or products.

Service industry sectors relying heavily on procurement

Procurement not only ensures the availability of critical services but also helps to manage costs, mitigate risks, and drive operational efficiency. As businesses continue to expand and adapt to new challenges, procurement plays a central role in supporting the strategic objectives of service-oriented companies.

Hospitality: Hotels, resorts, and restaurants rely heavily on procurement to source services such as cleaning, catering, facility maintenance, and staffing. Procurement also plays a role in managing suppliers for furniture, equipment, and technology services.

Healthcare: Hospitals and healthcare providers procure a wide range of services, including medical staffing, equipment maintenance, cleaning, IT systems, and medical waste management. The procurement process is critical to ensuring patient safety, regulatory compliance, and cost efficiency.

IT services: Businesses in the IT sector depend on procurement for a variety of services, from software licensing to cloud computing, infrastructure management, and cybersecurity. Given the rapidly evolving technology landscape, procurement in this industry must be agile and future-focused.

Why procurement in services is often overlooked

Despite its critical role in business success, procurement in the service industry is frequently underestimated or overshadowed by other functions. Several factors contribute to this oversight:

Intangible nature of services

Services, unlike goods, are intangible and often difficult to measure or quantify. While the value of a tangible product can be easily assessed through its quality, durability, or features, evaluating a service depends on less concrete factors such as reliability, responsiveness, and expertise. This intangible nature makes it challenging to demonstrate the direct impact of procurement on service outcomes.

Misconceptions about procurement’s impact

Many organisations perceive procurement as a transactional or administrative task rather than a strategic function. In the service industry, this misconception is amplified by the belief that procurement’s role ends once a service provider is contracted. However, procurement significantly influences service delivery by ensuring supplier alignment with business needs, managing performance, and maintaining cost efficiency.

Lack of visibility into procurement’s contribution

Procurement’s role in generating value often goes unnoticed because its contributions—such as cost savings, improved vendor relationships, or risk mitigation—are not immediately visible. Unlike manufacturing or retail, where procurement savings are evident in material costs, the benefits of procurement in services are often embedded in operational improvements, enhanced customer satisfaction, or reduced risks.

Outdated systems and processes

Outdated procurement systems and processes limit the function’s ability to deliver strategic value. Manual processes, siloed data, and a lack of automation prevent procurement teams from providing insights or driving innovation. As a result, procurement may struggle to demonstrate its importance in service industries, where agility and responsiveness are paramount.

Interestingly, 83% of international businesses prioritise improving customer satisfaction and experience by focusing on customer service. However, they often overlook how strategic procurement can support this goal. For instance, by selecting high-quality service providers, negotiating flexible contracts, and fostering innovation, procurement can directly contribute to better customer outcomes. The alignment of procurement with customer experience goals can unlock significant value but remains underutilised in many organisations.