Your e-procurement strategy includes the separate but connected processes of vendor selection, payment terms, contracts’ negotiations, and goods purchasing. When we think of the global context we are operating nowadays, e-procurement is becoming increasingly popular, helping businesses become more efficient.
E-procurement simplifies the purchasing and processing processes, ensuring interaction with pre-approved suppliers regardless of their location. It just takes a couple of minutes to finalize purchase approvals and complete orders.
Therefore, delivery time becomes shorter which can then be translated into better customer satisfaction. In business, each minute can cost you money. Thus, implementing an e-procurement strategy will bring significant savings both in time and money for your business. Keep reading this article and discover which are the most important steps you need to follow to implement your e-procurement strategy.
Identify your organization’s e-procurement needs
When you launched your business, you also initiated a traditional procurement process which served your needs until now. Even though there is always room for improvement, this doesn’t mean that e-procurement is always the solution. Therefore, before you embark into this adventure and invest money in your e-procurement strategy, you should first assess and document your current and future procurement process. You can create a mapping of your current procurement activities.
Thus, you will have a clear overview on how your actual procurement process looks like, and it will become easier to identify if you really need e-procurement for your business. For example, you can assess which are the current and desired timeframes for delivery and other tasks, check which the suppliers are involved, have a look at the agreed payment methods, and much more.
Once you have documented everything, you can now determine what procurement arrangements you need for your business to cope with today’s customer demands and to get prepared for expansion. Whenever you get ready for a change in your business processes, it is always better to start with the evaluation of your current situation. Create a diagram of your current process and get a clear idea of what is missing from your procurement strategy. Then, it will become very easy to identify the proper e-procurement strategy which will maximize your effectiveness.
Identify the flaws in your procurement process
Once you have clarified what you need from your e-procurement strategy, it will become very clear which are the flaws in your actual procurement process. For instance, you may be struggling with various issues related to your suppliers, or you might have late orders which upset your clients. The first step to improve your current situation is to understand the root cause and outline all the gaps that make your business less efficient.
Once you have identified the gaps and you know exactly what you need, you can start thinking of the solutions which will close those gaps. For example, you may discover that your list includes some unreliable suppliers which cause a lot of mess in your current procurement process. Therefore, the solution is pretty obvious. You need to review your suppliers’ list and make a detailed assessment of your current collaborators.
Plan your e-procurement strategy
Before you start planning your e-procurement strategy, it is very important to list the benefits of implementing it in your business. This list is going to be extremely helpful especially when you need to present this project to the management. Once the management approves your e-procurement strategy, it is time to plan each phase and set clear KPIs. You are now at the stage where you know which are your current process’ gaps and your expectations from your future e-procurement process.
When you draw each phase of your e-procurement implementation plan, you should also think of the human and financial resources involved, as well as where you can find more information about this process and which are the most appropriate persons to approach when you need help. Furthermore, you should also define clear KPIs for each phase and keep track of their progress. Whenever something doesn’t go as planned, you should also be ready with a remediation plan. Thus, you will avoid delays and any other extra costs.
Find the best fit for your business
There are several aspects you need to consider before you choose the optimal e-procurement solution provider. Some of the main factors which will help you decide are your budget and business requirements. However, the price shouldn’t influence your decision completely. You should also weigh what you get in comparison to what you pay. It is worth paying even though the price you receive might exceed your budget. Of course, this is so long as you receive high-quality services and complete e-procurement solutions.
Once you have chosen your e-procurement provider, it is time to start implementation. This should be a smooth process as long as you clearly define your team together with their roles and responsibilities. The implementation process requires special attention from your side and considerable resources. Thus, you should permanently check that you have enough resources to implement your e-procurement strategy. On the other hand, you should pay attention not to put too much pressure on your people.
When you decide to implement an e-procurement strategy in your business, it’s important to know the impact on your business. Therefore, communication is crucial during the entire process. Talk to your team and your superiors. Understand which are the biggest benefits an e-procurement strategy will have for your business. Once you have implemented it, your business will become stronger and more prepared to beat the competition.
Written By – Kristin Savage
Kristin Savage nourishes, sparks and empowers using the magic of a word. She is practicing regularly while reviewing new translation services at Pick Writers and constantly contributing to other educational platforms. Along with pursuing her degree in Creative Writing, Kristin was gaining experience in the publishing industry. You can find her on Facebook.