1. Making use of technologyThere’s been a lot of talk about incorporating technology and tech innovation into procurement processes. But do we actually understand why it’s important for companies to do so? It’s not just a matter of going with current trends, as technology has a lot to offer to procurement teams. From spend management systems and P2P software to fintech and SRM software, technology has changed the way we do procurement. These are some of the benefits of using e-procurement tools:
- Better visibility over spend and lower costs
- Increased operational performance
- Increased data accuracy
- Better data integration and standardisation
- Procurement globalisation (as e-procurement tools support various currencies, languages, helping connect buyers and supplier around the world)
- Reduced risk
2. Strong risk management policiesTechnology can visibly reduce risk when it comes to procurement processes. However, there are a few other things companies should consider, to benefit from a strong risk management program. There are a lot of mishaps that can affect a company’s procurement processes. From security breaches and system failures to civil disputes and natural disasters. It’s important for companies to be aware of the risks they face and develop procedures in case they happen to ensure business continuity.
3. Supplier relationship managementBuilding strong lasting relationships with your suppliers will help your organisation’s performance on the long term. In addition to constantly evaluating supplier contracts on a regular basis, to ensure performance and compliance, procurement professionals need to establish good communication and build trust with their suppliers. It is essential to make sure that both parties are on the same page and have definitive goals and plans of action laid out. Having a good supplier relationship management program has multiple implications:
- It helps make your strategic sourcing efforts work
- Integrated into source-to-pay efforts it helps strengthen the acuity of supply market intelligence
- Increased competition has determined suppliers to invest more in technologies and share ideas with customers with whom they have good, collaborative relationships. In consequence, this promotes increased collaboration between buyers and suppliers, strengthening partnerships and building long lasting relationships.