Procurement is a key function of of many if not all business organisations globally. Without a proper system of procurement, the entire business and supply chains will probably go into major malfunction, causing huge undesirable disruptions.
The traditional procurement process involves a very long one that begins with sourcing of products or services from external sources, negotiation of prices and contracts, obtaining the necessary approvals, execution of purchase orders , payment , right up to acquiring of goods & services
Many organisations have long lamented the long laborious process that is not only time consuming but also mired in various deficiencies such as
- Not getting qualified vendors,
- Lack of transparency
- Getting over-priced products,
- Increased risk of non-data compliance.
- Increased chances of organisational risk – i.e corruption
With many organisations digitalising their operations pre-pandemic, many are still struggling with their procurement process, as Procurement is widely regarded as one of the most complex business processes in a modern organisation due its nature and involvement with many people and departments. COVID 19 has not only accelerated the digitalisation of procurement and but also placed much emphasis on the transformation and integrating to be a key part of workplace strategy of every organisation.
Reasons why a digitalised procurement process will be an integral part of your post pandemic workplace playbook
- Contactless- With the entire process moved to a entire cloud based environment , will remove the need for any personal interactions for any single task.
2. Improved transparency and decision making- With every stakeholder being connected to the procurement process electronically, there will be much improved transparency , especially with prices and features of each product or service. This enables a much better and informed decision making process.
3. Reduce costs- The platform should rightfully have a robust price or bid comparison feature that will efficiently compare prices and features of each vendor against each respective benchmark of your needs and requirements. With such, organisations are expected to procure items and services at a much competitive price.
4. Reduced time spent – The ability to communicate and to carry out transactions all on one platform will speed up the entire process , eliminating down time.
5. Increased productivity – With reduced time and effort spent on mundane tasks such as administering contracts and work orders, more man hours can be directed to more productive activities such as sales and marketing etc to generate more revenue.
6. Minimise human errors- Any form of manual processes will have a certain risk of human error inherently. By relying on automated workflows and processes on the platform, will inevitably decrease such errors and also phase out the burden on relying on old out-dated traditional system of paper based processes.
7. Curated vendors- The platform should also allow stakeholders access to a marketplace of curated vendors in your location ( s ) . This feature will eliminate the need of sourcing and collating quotes from vendors and suppliers one by one manually which is one big time consuming task.
8. Digitalisation and data security – With automated workflows and processes in place, it eliminates the need for paper based contracts and forms and also ink based signature. Encrypted software also not only prevents fraud and also decrease the risk of data loss due to misplace, fire or other natural disasters.
9 . Simplified and automated contract management – Facility and procurement managers will be automatically notified by the system when the next due date for supplies top- up , service, contract renewal etc, instead of relying on each individual calendar notifications which may not be in sync among the stakeholders. This will improve the reliability of machines and processes running properly with a minimum risk of downtime.
10. Increased regulatory compliance – Businesses will definitely not run the risk of non- compliance once the procurement process is automated as human errors will largely be eliminated with the dropping of paper based tasks, Any error if there is will be detected instantly and rectified. Buyers will not over pay and over buy as a result or even under purchase in that sense.
11. Data – With the existence of a digitalised procurement process, valuable data can be generated. this will help top management in gaining visibility on how much resources are actually spent on the procurement process. And how are the company resources are best in extracting the best value from what they are paying according and matching to their requirements. As a result it enables top management to make much better investment and buying decisions.
Overall digitalisation has largely eradicated the need for paper based processes with many merits as stated above and many more to come. COVID 19 has only accelerated this change. With many companies attempting to make the transition, procurement is seen as one of the most critical processes that require a much needed over-haul immediately. Speak to us today and we will be able to help you to facilitate this transition.