In 2017, cost savings is critical to every competitive enterprise. However, thanks to the increasing complexity of global supply chains and bidding processes, enterprises in the digital era struggle to maintain the degree of control over their sourcing and procurement necessary to consistently minimize costs. This is why strategic sourcing, centered around a robust e-Sourcing solution, is now a core component of the modern enterprise’s approach to cost savings. By replacing the cumbersome, paperwork-based procurement and bidding processes of yesteryear with a highly automated solution, e-Sourcing saves the time and money needed to stay competitive while isolating the best bids from the most qualified suppliers. Here we explore the key features to look for in a strategic e-Sourcing solution that you can bank on to serve your modern procurement and sourcing needs while boosting your bottom line.
The capacity to perform online reverse auctions is an essential feature of every cost-saving e-Sourcing solution. A reverse auction is the opposite of a conventional or forward auction. Rather than having buyers place ever-higher bids to secure the purchase of products from a seller, a reverse auction has sellers/suppliers place ever lower bids to secure the sale of products to a buyer. When considering an e-Sourcing solution, always ensure that it includes a sophisticated, configurable, and highly automated reverse auction platform that will allow your enterprise to take full advantage of this essential cost-saving tool.
An RFP/RFI/RFQ Template Manager
To save valuable time redrafting your digital RFPs, RFIs, and RFQs, your e-Sourcing solution should have an intuitive, easy-to-use template manager. This feature should serve as a repository for all of your templates and allow you to quickly draft new RFPs, RFIs, and RFQs with all the structure you need already in place. One of the most striking benefits of a template manager is that your events will have uniformity and consistency that will aid in comparing event success metrics. RFQ Software is a key component for automating your quote management process
Real-time Response Reporting
Strategic sourcing can be a time-sensitive endeavor. In a competitive marketplace, any delay can cost you a key opportunity to secure the right supplier. Therefore, when comparing strategic e-Sourcing solutions, take time to scrutinize their RFP-RFI and RFQ response-reporting interface. Does the UI provide a means to view supplier responses in real-time? If not, you may want to hold out for a solution that does, because without the capacity for real-time interactions with potential sellers you could be leaving money on the table.
Supplier Evaluation and Scoring System
Without a system in place to efficiently and quantitatively evaluate responses from suppliers, an enterprise can find itself quickly overwhelmed with no clear way to isolate the most qualified suppliers. However, a robust e-Sourcing solution will have a configurable scoring system to solve this problem in advance. When comparing e-Sourcing software, pay close attention to the supplier-response scoring system. Look for the capacity to quantify responses with binary Yes/No responses, check-boxes, and radio buttons. Also, ensure that the provider has a built-in means of prioritizing and placing greater weight on the most important questions. Ideally, the software should allow for individual evaluators to set their own weightings in accordance with their own preferences.
Side-by-side Supplier Response and Score Comparison
When comparing supplier responses, there is no visual tool more powerful than a side-by-side comparison. A side-by-side format allows you to compare key supplier responses point for point to identify strengths and weaknesses, including overall response scores, at a glance. Yet it’s important to ensure that the e-Sourcing provider does not simply generate comparison reports, but gives you the capacity to configure them and export them to Excel. If the software allows for evaluators to create custom weightings and scores, the comparison feature will prove still stronger, enabling you to view each evaluator’s supplier score, side-by-side, isolating consistently favored suppliers. The result: the best odds of securing the lowest bids from the most qualified suppliers.
High Volume Capabilities
Any successful e-Sourcing solution will need to efficiently and elegantly handle bid-prices and quotes for thousands of items. Naturally, this will involve uploading, downloading, and updating spreadsheets, such as Excel files. Always ensure that the e-Sourcing solution you’re considering not only includes a high-volume/bulk-bidding feature but the capacity to seamlessly auto-generate prices/quotes from spreadsheets without requiring the supplier to follow a series of complicated conventions that could reduce bid volume and ultimately compromise your bottom line. The ability for the e-Sourcing software to allow the end-user to create RFPs, RFIs, and RFQs dynamically by simply uploading Excel spreadsheets is key to managing large and complex sourcing events.
Effortless Purchase Order Awarding Process
Once you have chosen a vendor, awarding them with a purchase order needs to be as simple as clicking a button. Once you’ve selected a vendor, you should be able to leave the rest to the e-Sourcing solution, which should automatically email a P.O. to the winning vendor while coordinating the new data with any corresponding ERP system in place. If this process is not automated, you will be spending unnecessary time on data entry and busywork.
Making it Easy for the Vendor
No matter how feature-rich and intuitive the e-Sourcing solution may be on your end, if your participating vendors have trouble navigating the questionnaire or otherwise using the e-Sourcing solution from their end, the bid and quote quality and volume will suffer, compromising your bottom line. Therefore, it’s of critical importance that the e-Sourcing solution you choose presents a highly intuitive, step-by-step interface for vendors to easily navigate.
When participants need to follow up with questions and clarifications at any point in the RFP/RFI/RFQ and bidding process, your e-Sourcing software needs to provide more than a follow-up email address or phone number. In 2017, real-time, online communications is an essential piece of the e-Sourcing process. Therefore, make sure that the e-Sourcing software you choose has an easy-to-use, real-time messaging platform that works seamlessly for vendors in all major browsers. The messaging platform should have one-to-one chat functionality, one-to-many broadcast functionality, and the capacity for inviting select participants into a group chat.
Compatibility With Leading ERP Software
If your enterprise’s data processes run on ERP software, such as SAP S/4HANA, it’s important that your e-Sourcing solution works with it. Therefore, ensure that the strategic sourcing solution you’re considering can be easily integrated with your ERP suite, either through APIs or other means. E-Sourcing software that is already built to integrate with leading ERP solutions will save you money in integration costs, further boosting your bottom line.
A Modern Sourcing Strategy
In the digital era, every competitive enterprise that aims to maximize cost savings while streamlining their sourcing process should strongly consider an e-Sourcing solution. However, before choosing an e-Sourcing software provider, it’s important to ensure that their software has all of the following key features and capabilities: a robust reverse auction platform; a highly configurable RFP/RFI/RFQ template manager; the capability for real-time response reporting; a rich set of supplier evaluation tools; a feature for side-by-side supplier-response and score comparison; the capability for handling large-complex sourcing events; an effortless purchase-order awarding process; a highly intuitive questionnaire and bidding process from the participant’s end; a real-time communication platform; and built-in compatibility with leading ERP software. Once you find and implement an e-Sourcing solution with all of these critical features, you will have a powerful vehicle to boost your bottom line for years to come.
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