Your remit as a procurement professional has probably undergone a transformation in the last decade. The transformation of the procurement function has been largely down to the digitalization of procurement processes, and digitalization is probably high on your corporate agenda.
When it comes to making your mark in your organization, you can kill two birds with one stone by meeting personal KPIs alongside actualizing technological improvements within your department. All you need is a strong enough rationale to take to the boardroom to get buy-in, and the ROI should take care of itself.
1. Contract Management Software
The most fundamental aspect of your role in procurement is to establish a beneficial relationship with vendors, secure affordable, quality goods and services and manage the end-to-end process. Contracts are the backbone of that process, and how strong your system of contract management is will largely reflect how successful those contracts are.
Meticulously organized, secure, easily accessible records are essential to operating a tight procurement ship. Holes in your contract management can lead to risk – legal risk, financial risk, compliance risk, and more. The key to successful risk management is oversight and control – you cannot have true oversight if your contracts are not easily accessible.
A centralized, standardized repository for contract data is the best way for your organization to ensure itself against risk and the potential for error.
Specific contract management software systems built to deliver on visibility, security and analytics potential make your organization’s contract management efficient and easy. You will be able to run reports to analyze supplier performance across single or multiple contracts, identify and eliminate risk and address issues promptly. Strong contract management, in turn, leads to strong procurement management, and an increase in efficiency and reduction in risk and error will always look tidy on your annual appraisal.
2. Spend Management software
The ROI of your procurement department is directly related to your own personal ROI. And what is more fundamental as a procurement KPI than achieving spend oversight, and being able to provide insights that can actualize cost savings?
You cannot truly achieve spend visibility without the right spend analytics software. Disparate data held in disparate sources cannot provide you with insights, and what you are missing there are opportunities for cost savings and efficiency.
The right spend analysis software will help your organization understand what data you need to be collecting, sort and cleanse all your current data, and get you to the point where you achieve true clarity and spend visibility at all times.
There is no point collecting data if you cannot use that data, and data categorization is the most important part of your spend analysis strategy to get right. It will form the basis of all your reporting capability, and provide actionable insights into your corporate spend.
3. Strategic Sourcing
If your KPIs are centered around cost savings, then the ability to use sophisticated e-Sourcing tools to drive innovation and efficiency in your sourcing process will truly power your procurement.
From e-RFX to reverse auction technology, you can achieve downward pressure on prices whilst requesting information and bids from potential vendors that are tailored towards your data collection preferences – saving everyone time and money, and realizing direct and indirect cost savings across the entire supply chain.
Reverse auctions particularly can be a game changer for procurement professionals who can set out all parameters of a deal early on in the process. The true purpose of this process is not to drive down costs as low as possible but to explore and establish value points at the front end of the deal and give suppliers the chance to pursue your business in an open and transparent forum. The cost savings resulting from reverse auctions can be as high as 40%, and can really make for some impressive figures in the boardroom. It would be nice to have your name attached to them wherever possible.
The digitalization of the procurement process is part of the journey for all procurement professionals.
The landscape of your profession is evolving on an almost daily basis, and the potential for just how strategic the procurement function is within a business is increasing at a rapid rate. To keep on top of how the job is developing, it is important that you are a driver of digital transformation in your role and organization. If your business is not adopting digitalization, and not investing in eProcurement, they are not investing in your professional development either. It is up to the procurement heroes to fight the good fight for investment in procurement automation, or risk being left behind as the rest of the world keeps moving forward.
ProcurePort is committed to helping procurement professionals drive digital transformation and progress in their businesses and careers. To talk us through how we can help your organization and you to unleash your procurement potential, contact our team of experts today.