Running a business successfully is a nuanced, challenging process. From determining budgets to onboarding talent and suppliers to procuring the goods you need to operate, the entire process can be time-consuming and difficult.
Doing things manually only increases the amount of time it takes to do things and, worse, opens your operation up to potential errors along the way.
Fortunately, procurement technology solutions can assist with not only attenuating some of these problems but ensuring your procurement procedures are the best they can be.
Here’s how technology can help improve procurement management at your organization.
1. Optimized Sourcing
Sourcing plays a pivotal role in procurement. Technology can help optimize sourcing by helping you to find suppliers easily, especially if it uses modern AI and machine learning tech.
By analyzing their past performance and evaluating their overall business capacity, these technologies can help you find the suppliers best suited to your needs. Tech is also useful for managing timely bid requests, automating invoices/POs, and much more.
Technology can help you reduce the time it takes to source suppliers, reduce the number of suppliers you work with, and improve their performance/quality of service.
All the data gets folded into the system and analyzed to create a more optimal system for your procurement and sourcing needs.
2. Centralized Vendor Management
Technology is an amazing thing when applied to procurement and vendor management. P2P can be a costly endeavor, and vendor management helps reduce those costs.
Managing suppliers is just as vital as hiring them in the first place. Having a procure to pay solution where you can track, monitor and supply feedback to your vendors is essential.
Centralized vendor management invoices procurement efficiency and visibility into a supplier’s performance. It gives companies the ability to glean vital insight from suppliers while managing them effectively.
Through the use of a centralized hub, it’s easier to cultivate better supplier relationships and dismiss vendors who aren’t helping your overall operation.
3. Automation
In the modern world, running things manually doesn’t make much sense anymore. Not only does it cost more to do so, it can be the source for errors and plenty of other issues during the procurement stage.
Repetitive tasks (like receipt tracking and checking invoices) are a hassle for most teams and can drastically slow down the P2P process at most companies. Automating processes like buying guides and acquiring services can help improve efficiency and productivity.
Automating such activities can also help gather the data that goes into your budgets, making them easier to assess and manage. Moreover, automation also makes it easier to streamline purchase requisitions and POs by simply allowing your teams to access them 24/7 and approve them if needed.
Automation plays an integral role in most tech-based industries and it’s an invaluable tool in any procurement department regardless of industry.
4. Electronic Contract Management
Procurement technology can improve your processes and protect you from legal risks—especially when it comes to contract management.
As part of an overall procurement software package, electronic contract management removed some of the more frustrating and potentially detrimental aspects of managing a supplier contract from your team’s already full plates.
With contract management included as part of a procurement software suite, you can negotiate terms online, work with multiple parties to set up a contract, and show all of your contract statuses in a single location.
Electronic signatures make approvals and renewals go faster. Electronic communication also makes it easy to customize delivery and add attachments as needed. Instead of assigning a team to manually handle these processes, your software can automate the majority of it for you.
This essentially reduces paperwork, which in turn reduces delays, and ultimately leads to higher productivity and accuracy within your contracts.
By improving visibility into the complexities of the contract life cycle and contractual obligations, you can ensure suppliers are being held accountable to their agreements and everything is working as it should.
5. Better Spending Control
Controlling costs and mitigating spend/spend risk is a vital component of any procurement strategy. Utilizing comprehensive procurement management software can help you get a handle on this and make it easier to seamlessly run your procurement department.
Whether it’s providing visibility into spending or how services are being procured, purchasing software gives you a real time handle on every part of the procurement process.
This ultimately helps you manage spending, identify rogue spending, and can help you reduce costs—and save time—as you operate your business.
Software isn’t a one-size-fits-all solution to all your procurement challenges, but it’s a great start to finding something that works to optimize your business and streamline P2P processes as much as possible.
