How is the procurement process different with digital transformation versus a regular IT software?

Harriet Costa

How is the procurement process different with digital transformation versus a regular IT software? 

Dirk Slama

In many IIoT projects, you have a significantly higher complexity, because you need:

·       Complex custom embedded hardware, potentially customized for different regions

·       Complex custom embedded software

·       Complex custom backend software

·       Specialized IoT WAN coverage for different regions

Furthermore, because we are dealing with physical assets and not only purely digital solutions, you will face more complexity with regards to requirements, scalability, robustness, verification and validation, safety, security and last but not least regulatory requirements.

All of the above are also drivers of sourcing complexity.

Bassam Zarkout

IoT is more than IT for Things. DX and IoT will add several perspectives to the procurement process:

1. In most likelihood, the acquisition will not be limited to software, covering sensors, actuators, edge devices, digital twin components, AI-powered components, and infrastructure components which may not be part of the IT infrastructure. It may also cover actual physical “things” like pumps, motors, actuated valves, factory floor controls.
2. In addition, Digital Transformation itself may result in additional requirements which must be taken into account during the procurement process.
3. Finally, the need to establish trustworthiness in the physical IoT systems may involve/impose additional requirements related to security, privacy, safety, reliability and resilience.