5 Things You Probably Didn’t Know About Procurement Software

Automation is transforming the way we do business. Electronic procurement software can automate the process of ordering and purchasing the supplies your company needs, to streamline purchasing, ordering, and managing procurement. It can even take the guesswork out of vendor relationships.

But if you’re like many procurement professionals, you might be reluctant to implement an automated solution, for fear that the disruption it causes won’t be worth the benefits. While moving away from traditional processes may cause an initial disruption, in the long run, automated procurement management can only benefit your business. Here’s how.

1) It Brings Greater Transparency to Your Purchase Order Processes

The procure-to-pay cycle involves putting together purchase orders, creating invoices, and processing orders and payments. There’s a lot of room in that process for bottlenecks to form, especially when your procurement team has to manually deal with creating, sharing, verifying, and filing documentation. Collating data manually for quarterly or annual reports, or future forecasts, can involve countless hours of sifting through hundreds of line items, digging through file cabinets, or hunting for emails.

Procurement management software brings ease and transparency to the procure-to-pay cycle. It can make all of your procure-to-pay data and documentation easy to access, organize, and manipulate. Need to find the documentation related to a specific order? No problem. Need to create an annual report? No worries. Reports can be generated on demand, without the need to spend time manipulating spreadsheets.

2) It Can Help You Ditch Your Worst Suppliers

Who are the worst vendors your company works with – the ones who offer the lowest-quality products, the worst service, or the highest prices? Do you even know? Procurement management software can help you identify and weed those bad vendors out. Software can use real-time scoring data to help you pinpoint which suppliers are offering you the best products, service, and deals, and can help you leverage the full strength of volume-based discounts, vendor relationships, and other discount structures. This will save you resources and reduce the risks associated with working with less-preferred vendors.

3) It Will Centralize Your Relevant Documents

Do you know where all your contracts are? Are some contracts in one employee’s office while others are in another employee’s office? Are those offices in the same building? Are there digital copies of the contracts in question, or are you relying on hard copies that spend more time gathering dust than doing you any good?

Procurement software can help you centralize all your contracts in one location. Your team will have greater control over contract compliance. They’ll have an enhanced ability to monitor when contracts are expiring, and need to be renewed. They’ll be able to more easily spot overlapping or duplicate contracts. Your company will be in a better position to negotiate more favorable contracts in the future, and you’ll avoid the compliance nightmares that can come with disorganization.

4) It Can Shorten the Business Cycle

With electronic procurement software, you can whiz through the procure-to-pay cycle at the speed of digital communications. Automated processes and digital communication will mean that transactions reach completion much faster, and that will shorten your business cycle. A shorter business cycle will mean faster growth and higher profits, and can improve operations throughout your company, as other departments also benefit from speedier transactions and procurement automation.

5) It Can Boost Productivity

When you implement a software solution to automate procurement, you’ll give your team the tools to be more productive. That’s because procurement software automates many of the time-consuming manual tasks associated with managing the procure-to-pay cycle the old-fashioned way. Without those lower-level manual tasks on their hands, your team’s time will be freed up to focus on higher-level tasks that can’t be completed by software, like working to strengthen relationships with suppliers or solve sourcing problems. They’ll be more engaged and productive, and you’ll get more and better work out of fewer employees, which will further reduce operating costs.

It’s understandable to be concerned about a big change in processes, but switching to automated procurement management is one of the best things you can do for your business. Procurement software takes much of the burden of managing the procure-to-pay cycle off of your employees, so they can focus on more important things – and that can mean only good things for your company’s future.