What Is eSourcing in Supply Chain Management?
If you work in procurement or the purchasing department, you’re already aware of how it works. However, it’s the rest of the organization that might not fully understand the process.
When you think about the supply chain, you’re thinking about the entire process from start to finish when it comes to creating a good, while procurement is only one small part of the supply chain—essentially working with suppliers and internal stakeholders to procure and attain goods and services in a timely fashion for manufacture (or for other means) that are the best fit for the organization.
Read on to learn, “What is eSourcing in supply chain management?” and how to manage your process better while running a digital eSourcing system.
What Is eSourcing in Supply Chain Management? eSourcing Software
Using eSourcing software can help you build a better relationship with your suppliers, while also finding better suppliers for your needs at the same time. This type of software is a small but very imperative part of the overall Sourcing process. When you ask, ”What is eSourcing in supply chain management?” eSourcing is part of the supply chain, and eSourcing is part of E-procurement.
A typical eSourcing process may look something like:
- pre-purchase questionnaire
- invitation to tender
- contract award
- supplier relationship management
An eAuction can run, at any point in the eSourcing process once items have been identified and suppliers have been approved.
There are quite a few benefits of eSourcing, similarly to the benefits of E-procurement as a whole. Using eSourcing software reduces costs, saves time and maximizes your efficiency, offers you detailed supplier information so you can make a more educated choice, and helps ensure compliance.
What Is eSourcing in Supply Chain Management? Managing Risk
Whether you’re still moving to a digital format or are presently using E-procurement software, methods for managing procurement risks are of vital importance. Purchasing managers often find that the biggest risks lie in contracts and contract management.
A good rule of thumb is to carry over all SLAs and T&Cs from the sourcing phase and put them into stone in the contract. That way, there is no going back.
Also, clearly assigning risk within the contract lets each party know how much risk they’re comfortable taking on.
It’s always important to analyze risk upfront, as they occur and to monitor each risk on a regular basis. Having good software with reliable analytics can help you through this process.
What Is eSourcing in Supply Chain Management? Using eAuction Software
eAuction software is a part of the eSourcing process. Using eAuction software for procurement can be exceptionally beneficial. It can streamline your process, allow you to work with multiple suppliers and accept the best bid, can increase your revenue potential, and can save both time and money.
The best procurement software is easy for the user to set up and understand. Gone are the days of trying to figure out complicated calculations on Excel spreadsheets. Intuitive software walks you through installation and setup, and also gives you tutorials on how to run it. eAuction software can also be a separate part of eSourcing software and oftentimes follows an organized sourcing process to pre-qualify the suppliers.
If you are still wondering,“What is eSourcing in supply chain management?” or have more questions about eSourcing or eAuction software or would like to request a demo, contact EC Sourcing Group today at 973-936-9672.