Procurement can involve a massive allocation of company resources to make the necessary contacts, agree on the necessary contract terms, and bring together a web of suppliers so that your organization’s needs never go unfulfilled, even when a specific supplier falls short. All of this work used to be done manually, and if your company is still doing it manually, you need to familiarize yourself with the many benefits of automated procurement.
So many of the tasks related to procurement are boring and tedious — just the kind of stuff that leave even your best employees prone to making mistakes out of sheer boredom. There’s no reason to spend the time and man hours on much of the procurement process. These days, there are sophisticated tools available to help you automate all aspects of procurement. Let’s take a look at what automating procurement can do for your company.
Eliminate Risk Factors
Managing procurement is all about finding ways to mitigate common risks while still saving money and streamlining processes. To save more time and money, work more efficiently, and enhance effectiveness, you need to move away from manual procurement processes and transition to an automated procurement tool.
With procurement automation, your organization can exchange and update documents quickly and enforce the policies intended to keep your buyers within budget guidelines and purchasing restrictions. Reduce or eliminate risk factors like human error, data entry error, off-catalog purchases, and duplicate payments. Streamline your company’s purchase-to-pay cycle, buy more intelligently, and protect yourself from supply chain risks.
Get More Out of Your Suppliers
No more will you have to pay employees for seemingly endless hours of nothing more than supplier data management. Now you can use a procurement automation tool to manage supplier data automatically, and in a way that will empower your suppliers to give you more of their best performance.
Automated procurement tools allow you to give your suppliers and vendors a portal that they can use to track the status of payments, update shipping data, communicate effectively with their contacts in your company, view and monitor purchase orders, and more. Consistent on-time payments and accurate payment processing, combined with transparency into the payment process, can do a lot to put your company in suppliers’ good graces. Combine these with early-payment discounts and incentives to forge supplier relationships that are stronger than ever.
Stop Dark Purchasing
Using scattered and outdated procurement tools can result in dark purchasing, which occurs when there’s a lack of transparency into the purchasing process so that key stakeholders have no clue what’s being procured, when, how, or why. If you don’t crack down on dark purchasing and shed the light of automated procurement tools on your purchasing processes, you’re doing business in an organization where duplicate purchases, off-catalog purchases, purchases from unapproved vendors, and unnecessary purchases could drain your coffers. With the right procurement tools, you can easily identify sources of maverick spending and bring spending under control.
Make Duplicate Payments a Thing of the Past
Duplicate payments can be a huge hassle. When you accidentally pay the same invoice twice, you might end up struggling to claw back the payment from the supplier, and you might even have to pay bank fees in order to stop a check or electronic transfer. That’s not even to mention the extra man hours you’ll have to pay for some employee to pay that invoice unnecessarily a second time.
Automated procurement tools allow you to keep track of what’s been paid and what hasn’t been paid — they can automatically verify your new invoices against past invoices and company accounts to show you what has and hasn’t been paid at a glance.
Pull Down Those Data Silos
Data siloing can cause huge problems for procurement, because it fosters a lack of clarity and communication between departments and creates an environment in which maverick spending can thrive. Procurement cycles can lengthen and opportunities can be missed as stakeholders in different departments across the company struggle to keep each other in the loop on procurement processes. They might not even realize they need to connect with another department or a specific employee. Automating procurement brings clarity to the process and consolidates procurement processes in one place so that everyone who needs to be involved can work together without the hassle of false barriers to collaboration.
Procurement automation can do so much for your company — it can save you time and money, make your suppliers like you more, and even let your employees focus on tasks that can only be done by humans. It’s time to automate your organization’s procurement processes, so you can focus on doing what you do best — serving your customer base.