eSourcing Optimization: 4 Things You Need to Know
Sourcing in procurement refers to finding goods or services, finding potential suppliers, and then selecting. The general steps of sourcing don’t change using eSourcing and award optimization—it’s just that the process is streamlined because you’re now digitally sourcing and collaborating with suppliers.
eSourcing can often be confused with eProcurement. However, these are two different things. eSourcing software is meant to simplify contract negotiation, while eProcurement software aims to optimize the flow of goods and services.
eProcurement is part of the overall supply chain, while eSourcing falls under the eProcurement umbrella. However, having robust software is pointless if you’re unsure of how to use it properly, or you’re not using eSourcing software to its fullest potential with scenario-based award optimization.
Read on to learn four things you should know about eSourcing optimization and how it can expedite your process.
eSourcing Optimization: Solves Big Data Problems
One benefit of eSourcing optimization is that it solves big data problems. Technology is continually evolving, and you want to ensure you have software that can make suggestions and conclusions quickly.
eSourcing optimization can quickly compile hundreds of thousands of bids along with non-bid factors like diversity, incumbency, or supplier tier. This data can then be used for complex analyses. Unfortunately, spreadsheets at this point are archaic, and you can’t accomplish these more involved processes and analyses without the proper software.
eSourcing Optimization: Optimization Saves Time
One of the most important things about eSourcing optimization is that it saves time. Throughout the supply chain, efficiency is key to procurement optimization to eSourcing optimization.
Automation is extremely useful throughout the entire eSourcing process. Constraints or operational rules copied and reused later can generate award scenarios in minutes that used to take days or weeks with spreadsheets alone. Templates are also helpful with eSourcing Optimization since many organizations have standard scenarios that they want to run. So the ability to quickly copy templates into a new event saves extra time.
You can easily add more constraints to refine any award with award optimization. This can be helpful when you want to remove one supplier or ensure one location only has one supplier. Additionally, you can look at side-by-side comparisons later to evaluate each award and the suppliers more quickly.
eSourcing Optimization: Optimization Saves Money
When a business or organization saves time, saving money is another benefit by proxy. While some may think taking away human negotiation and replacing it with automated processes will be detrimental, it adds to collaboration because of transparency and the ability to make decisions instantly.
There is a seamless, intuitive nature of sourcing optimization, which takes you away from frustrating spreadsheets and onto a bid optimization platform that is simple to use. With all of these less labor-intensive tasks, you’ll increase efficiency, make better decisions and save money.
eSourcing Optimization: Increases Competition
Not only does optimization increase speed, but it also increases competition. With concepts like reverse auctions, more suppliers compete for your business, and you also form better relationships with strategic suppliers and form relationships with new vendors. eSourcing benefits both buyer and supplier alike.
However, the software choice you make is important. Features such as the ability to create POs and other documents in minutes, maintaining vendor compliance, and an intuitive and simple way to evaluate suppliers after the fact are imperative.
To learn more about eSourcing optimization or to request a software demo, contact us at EC Sourcing Group today at 973-936-9672. We want you to reimagine the way you think about procurement.