Transform Procurement with the Best eProcurement Software

As we all know, procurement is the end-to-end process of acquiring third-party goods and services and making them available at the right place, right time and in the right quantity and quality.

The traditional procurement techniques rely on cumbersome manual processes. One typical scenario is of procurement buyers searching manually numerous supplier catalogs without being aware of any discounts or supplier reviews on quality or delivery issues and choosing the one that offers the lowest price. 

Whereas, with digital procurement, procurement solutions can automate and streamline these manual, routine procurement tasks and freeing up the time of buyers to make the best purchasing decisions using data and analytics, delivering optimal value to the business. 

Some of the major benefits digital procurement offers compared to traditional procurement are:

• Accelerated processing time resulting in shorter procurement cycles
• Easy access to more suppliers
• Access to more accurate and real-time information
• Improved visibility of spend
• More transparency and enhanced compliance
• Higher productivity, fewer errors and lesser rework

eSourcing or Source-to-Procure (S2P) is the process that creates supply channels that procurement teams use to acquire supplies for the organization. It comprises efforts to create and maintain a supply base ideal for the organization’s needs by vetting suppliers and maintaining supplier relationships. Hence, Source-to-Procure involves all the upstream activities starting from spend analysis, category management, identifying and evaluating suppliers, management of RFIs, RFPs and RFQs, supplier management to contract management. 

eProcurement or Procure-to-Pay(P2P) which is also known as electronic procurement is the online process of purchasing products and services from suppliers. It involves processes such as requisitioning, generating purchase orders, receiving, and generating invoices and payments.

Source-to-Pay function is a procurement process that involves identifying and analyzing suppliers, negotiating with suppliers, awarding contracts, managing supplier contracts, ordering supplies and eventually releasing payments after accepting the delivery of the products. 

Automation of the source-to-pay process offers several advantages such as making the procurement process more efficient, simplifying supplier management, reducing maverick expenses, mitigating risks, etc. Some of the most obvious benefits include:

• By automating the manual repetitive processes in the workflow, you may save money by improving efficiency and speed and reducing errors.
• The automated Source-to-Pay process helps to enhance audit compliance and prevents any contract or policy breaches from occurring.
• Automation of S2P aids in the development of a diverse and adaptable supplier base.
• The automation of the S2P process allows for quicker decision-making in the supplier selection process.
• S2P automation can simplify the ordering process by ensuring precise purchase orders and required approvals.

A unified source-to-pay automation solution allows for a streamlined process across the complete S2P lifecycle.

An ERP stands for Enterprise Resource Planning system. It is used to manage business processes that are designed to enhance operations that connect many aspects of the company. Typically, the objective is to combine operations, like planning, finance, supply chain management, HR, inventory management and CRM into a single integrated system. However, when it comes to procurement management, ERPs provide only limited transactional purchasing capabilities and very basic capabilities for upstream activities such as sourcing and contract management.

On the contrary, an e-procurement system is designed to meet organizations’ procurement needs. It consists of in-depth features for managing sourcing, spend analytics, supplier management, and contract management that are integrated to make a single comprehensive solution. An e-procurement software allows users to gain total control and visibility over sourcing operations and demands. It assists in identifying cost-cutting possibilities and adopting a strategic approach for managing procurement. In other words, an eProcurement system complements your ERP and helps enhance the buying process.

Procurement digital transformation across the complete supply chain enables digitization of end-to-end processes from gathering and reviewing data on sourcing needs to promoting supplier relationship management to ensure quick and efficient procurement of goods and services.

Here are the top 6 advancements that are defining digitalization in procurement strategies:

• Automation: BPA (Business Process Automation) and RPA (Robotic Process Automation) are two forms of automation that may be used in the procurement process. They can assist organizations in eliminating manual work by automating day-to-day sourcing activities such as recognizing business needs, tracking spend, managing suppliers and their information, raising requisitions and their approvals, managing demand in real-time and so on.
• Data Analytics: A data-driven approach to sourcing and procurement can assist firms in gaining insights to define their sourcing strategies well and deliver sustainable savings. Advanced analytics solutions that provide predictive analytics capabilities can predict future trends based on trends and patterns in current and past procurement data. Prescriptive analytics is the next stage where the predictive models based on procurement data aid decision making and can recommend optimal course of action. There are multiple application areas of analytics in procurement – spend and cost analytics, what-If-analysis, supplier analytics, contract analytics, savings analysis, spend forecasting, etc.
• Cloud: Cloud-based solutions enable businesses to save money on upfront costs and improve real-time data exchange.
• Artificial Intelligence: AI allows procurement organizations to simplify complex procurement processes and enhance decision-making to make the process more efficient and effective. AI can be used across different areas in procurement from spend analysis to contract management and strategic sourcing. 
• Blockchain: This technology helps in accelerating and adding security and transparency to procurement processes. It can help buyers to ensure authenticity and traceability of all goods throughout the purchasing cycle.  Blockchain could also enable creation of smart contracts that can self-verify their own conditions and self-execute.