The current trend for automation has been dubbed the fourth industrial revolution, and your business’ procurement department is as much a part of this revolution as any other business function.

In his book about Industry 4.0, The 4th Industrial Revolution, Professor Klaus Schwab calls for leaders and citizens to “together shape a future that works for all by putting people first, empowering them and constantly reminding ourselves that all of these new technologies are first and foremost tools made by people for people.”

Automation should be about making our lives easier and safer. Automation in your procurement process should be about the same objectives – increased efficiency, reduced risk, and added value. In this blog, we investigate the 4 most obvious ways your procurement function can achieve all of these things and more by automating your e-Sourcing process.

1. Online RFX

e-RFX software can enable your business to manage all RFP, RFI, and RFQ requests and responses in a consolidated, comparable and reportable format. RFX without technology looked like reams of often irrelevant, disparate data and a lot of man-hours to sift through it and extract the need-to-know information from it. That data would then need to be collated somewhere, somehow. With the entire process automated, your business can stay in control of how your potential suppliers provide you with the requested data, and workflow is managed smoothly.

2. Contract Management

A robust contract management system is a crucial tool in ensuring all the good work put into the front end of negotiating a contract is then followed through with adequate tracking of the contract terms and supplier performance. Without an adequate contract management system where all stakeholders have access to real-time, standardized information, contract terms can fall by the wayside and vital information can be missed.

3. Reverse auction technology

We know reverse auctions aren’t appropriate for every organization or every spend category, but they could be a tool to help your organization actualize significant cost savings.

An e-auction doesn’t need to be a bidding war, rather it can be an opportunity for a standardized, centralized system of organizing supplier bids, encouraging transparency and opening up an opportunity for a wider range of potential suppliers to encourage competition and innovation. Suppliers know that while eAuctions are value driven, the price is not the only deciding factor when it comes to awarding contracts. Cheapest does not necessarily equate to the best value or best fit, but eAuction software gives buyers the benefit of setting out stipulations and parameters at the outset and encourages total transparency.

4. Spend Analysis

A spend analysis is the only way to ensure your business is up-to-date on all aspects of your corporate spend and able to answer every question related to what you are spending, who with and why. Without access to this information, your organization is operating in the dark, and contract management software can help shine a light on all areas of your corporate spend, helping you eliminate maverick spend, realize cost savings and keep your finger on the pulse of your business’ performance.

A full-service e-Sourcing solution

In an ideal world, your business will utilize a combination of some or all of these tools. e-Sourcing automation will create opportunities to drive efficiency, value, and cost-savings across your entire organization, but only if the solutions are used to their full potential.

For this reason, our team of experts is on hand to help you make the most of our suite of e-Sourcing software solutions, ensuring that you are extracting the best value from your investment. For more industry and market insights, and advice on procurement best practice take a look at our blog archives.