Why Your Traditional Procurement Process Needs an Overhaul

Your traditional procurement arrangement has served you relatively well over the years but there’s always room for improvement. Before you can begin to put in place improvements to the procurement process, it’s necessary to have a clear overview of the current procurement process in use. To do this, assess and document every aspect of the procurement process, including time frames for different tasks, suppliers involved, compliance checks, payment methods, etc. Subsequently, think about your desired procurement arrangements and put it in black-and white so that you have a form of reference. Once you’ve completed these steps, you should have a clearer idea of what needs to be included in your new e-procurement strategy to maximize the effectiveness and efficiency of your business procurement process.

Identify gaps and solutions to bridge the gaps

Having clarified your current and desired procurement process, you can now start to identify the gaps in your current procurement strategy. Some of the more common procurement problems that businesses everywhere face include burgeoning costs, supplier-related issues, accidental or late orders and non-compliance with procurement policy.

Document the benefits of implementing an e-procurement system

Listing down the benefits of implementing an e-procurement system can really help to get management buy in. Overhauling a business process is very often an expensive affair, so for it to materialize, management buy-in is a must. Try to organize your list of benefits according to what management considers important, first of which is usually the company’s bottom line. If you can convince management that implementing an e-procurement system is cost-effective and brings savings to the company in terms of time and resources, you ae more likely to obtain approval to proceed with your e-procurement strategy.

 Develop an e-procurement plan and KPIs

Now that you have a clear understanding of your current and desired procurement process, identified the issues in your procurement strategy and am privy to the benefits of e-procurement, it’s time to think about how to revamp your entire procurement process through e-procurement. What are the plus points of using e-procurement? What are the processes, costs and resources involved? Where can I find more information about the e-procurement process? Who should I approach to kickstart the e-procurement plan? These are just some of the questions you need to ask yourself when developing an e-procurement plan.

Review and select the optimal e-procurement solution provider

When deciding on an e-procurement solutions provider, it’s important to review company budgets and requirements. Price may be a big consideration when selecting a provider, but it shouldn’t be the determining factor either. The reliability of the provider can make all the difference to your company’s bottom line so be sure to carry out research on potential providers, focusing on track records, expertise and service offerings. A competent e-procurement solutions provider can greatly reduce the huge administrative burden associated with procurement processes, the management and evaluation of submissions, and the management of your supplier base.

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