By Daniel Ball, Business Development Director at Wax Digital
Effective procurement is becoming increasingly important to most businesses. Ever since the 2008 financial crash, organisations have tried to cut costs where they can; with better buying consistently being leveraged as an essential part of the cost-saving strategy. Yet, businesses can easily spend more than two-thirds of their revenue on indirect and direct procurement, from office supplies to paying other third-party vendors, it doesn’t take much for these costs to add up.
To increase visibility and reduce maverick spending, eProcurement software is helping many organisations gain control of business-wide spending. This has been especially prevalent since the impacts of COVID-19 has forced businesses to review costs and diversify their supply chains. To ensure success, procurement professionals need to think carefully about building a more efficient procurement process with technology at its core – here are five considerations:
- Turn to the cloud
Digital transformation has fundamentally changed our relationship with technology and businesses that opt for a solution that doesn’t leverage the cloud will be at a considerable disadvantage. Not only is cloud technology cheaper than on-premise solutions but it means that employees can go online and work anywhere and at any time. Additionally, all the cloud is updated and maintained centrally by the solution provider.
- Automation of manual processes
Automating routine tasks is an important part of any eProcurement solution as this can help boost productivity, improve data accuracy and result in significant time savings. Tasks that should be automated include:
- Workflows to make sure purchase orders are distributed to relevant parties when requisitions are raised.
- Approvals sent to relevant stakeholders when purchase orders need to be invoiced, avoiding the need for data entry.
- Automated matching of invoices to purchase orders.
- Improve data visibility
Professionals often spend a large amount of time using programmes such as Excel to compile formulas and charts to present and manage their data. An eProcurement tool can help simplify this – information is nicely packaged and ready to consume at a glance. It will also help visualise where the spend is going while tracking and identifying problematic areas. Its monitoring capabilities should include:
- A real-time view of the goods and services the business is currently spending its money on. This shows if the buying process is operating successfully.
- A broken-down view of departmental spending. Businesses can see who is spending, and what they’re buying.
- Historical data that can help identify spending trends and be used to spot potential spot saving opportunities.
- Only best-of-breed will do
A top-class eProcurement system that can integrate with other systems more easily will give the business more choice and flexibility. While there are some good ERP-based solutions, a dedicated eProcurement solution offers far more functionality and is typically much easier to use.
- Integration with other systems is key
Any eProcurement solution provider must be able to demonstrate proof they can integrate with a range of ERP systems including Microsoft Dynamics, SunSystems and Sage. Also, it’s important to consider solutions that can integrate with tools from other departments such as finance. Software with pre-packaged integration technology can be deployed quickly and be tailored to link all systems.
There are many benefits to using an eProcurement system. Not only will it help reduce costs and effectively manage business spend, it can also help save the time normally associated with manual tasks, enabling employees to focus on more important tasks that deliver value to the business.
