Procurement Software and Solutions
The process of procurement has significantly advanced in recent decades, mainly due to the internet and cloud-based applications that can help streamline the process. The early days of eProcurement software were still intricate, with much dependence on spreadsheets to try to organize data. Today, the benefits of procurement software are many, but there are a lot of choices out there—having the right software is imperative for procurement optimization.
Read on to learn more about the benefits of procurement software, how it differs from eSourcing and its software, and what features to look for when you’re trying to make a decision.
Why Are Procurement Software and Solutions Important?
No matter what industry you’re in, whether it be industrial, governmental, or another industry that relies on procurement, time is wasted and not evaluated, which by proxy means that money is wasted also. Procurement software and solutions are important because they streamline the process of procurement while also providing you with relevant analytics so you can catch things such as rogue spending and see procurement opportunities more easily.
The right software will allow you to track, manage, and analyze spending, so that you can make important decisions. The functions of procurement software are to manage the procure-to-pay cycle, centralize purchasing information, and control spend. The benefits of procurement software are many, as this promotes efficiency.
Procurement Software and Solutions: eSourcing vs. eProcurement
The words eProcurement and eSourcing are often used interchangeably when they are actually two different things.
Think of the entire supply chain and all the processes included, from start to finish. Procurement is part of the supply chain, and sourcing is under the umbrella of procurement. Sourcing deals with all aspects of finding a supplier and contract management, and its software should be able to support these needs (such as eRFX).
In contrast, procurement is the compliance and transaction piece in the supply chain. Your eProcurement software should be focused on the actual purchase of services and goods after the supplier has been sourced. It’s important to have both types of software (or a software suite with features of both) so you’re able to manage all parts of the procurement process with automation, transparency, and collaboration.
The Benefits of Procurement Software and Solutions: What Features Should I Look For?
Every company and industry has specialized needs, and to reap the benefits of procurement software, you need to decide what features would help improve your business process. To choose the right software, ask yourself, “What problems am I trying to solve?” While it’s wise to choose a suite with robust features, the must-have features of procurement software include:
- Mobile accessibility. This allows you to keep track of everything in real-time and to be able to make decisions on the go.
- Fast onboarding and an easy-to-use interface. eProcurement is supposed to streamline, not frustrate. Make sure you choose intuitive software, so yourself, your team, and your suppliers can catch on quickly.
- Integration with the accounting department. The benefits of procurement software are many when you and the accounting department can collaborate, including accurate analytics.
- Supports complete procure-to-pay cycle. You don’t want software that leaves you hanging, only streamlining one or several parts of the procurement process.
- Customized approval workflows. This tracks your approvals and requests, and working with your customized approvals should be as easy as drag & drop.
- Budget tracking in real-time. Concerns about budget and spend are a daily affair, so you want software that allows you to track spend versus budget in real-time.
- Linkage to contract management solutions. Your eProcurement software should support all aspects of contract management.
- Spend analysis and reporting. Beyond the budget, one of the biggest benefits of procurement software is the ability to have concise spend analytics and reports to be more informed in your decision-making.
Procurement Software and Solutions: What Are the Risks of Procurement?
Most everything comes with a risk, including procurement. However, another benefit of procurement software is the ability to mitigate risks. If you’re paired with the right suite for you, your software should be able to minimize risk, not increase it. Some of the procurement risks that procurement optimization can solve are:
- Poor needs analysis
- Inefficient contract management
- Fraud and corruption
- Overall poor supply chain management
- Lack of visibility to supplier risk
The benefits of procurement software allow you to perform competent and complete needs analyses and have all of your contract management needs centralized to one area that everyone can access.
Procurement solutions can help nip fraud in the bud, as you see where all your spend is going. Making sure the procurement process runs smoothly after sourcing is imperative to supplier relations and your overall ROI.
If you have more questions about the benefits of procurement software or would like to schedule a demo, contact EC Sourcing Group today at 973-936-9672. We want to help you reimagine the way you think about procurement.