It is no more a secret that the advantages of procurement automation are properly described. The fact is there are plenty of solutions in the market, but finding the right one for your company can be overwhelming. However, it is time to discuss how procurement automation is benefitting the companies irrespective of the industry. Read on to know.
What are the advantages of procurement automation?
Speeds up the process of approval
In the approval process, purchase requests often get stuck. Automating the buying process makes it convenient to place orders and lessen the time for ordering. It eliminates redundant processes and enables employees to get more work done in a short time. This also reduces staffing price and frees up time for strategic procurement.
Enhances spend visibility
Automation helps in improving and maintaining high-quality data. You will get details of previous purchases, order history, contracts and supplier quotes. Placing a procurement automation system gives you a combined view of the expenses, making it easier to make decisions for fresh purchase and enhancing cost reduction. Finally, you start saving and channel your expenditure management with the spend analysis process.
Improves relationships with suppliers
It is vital to have transparent and clear disclosure to enjoy long-term supplier relationships via the supply chain. With the assistance of automation, it becomes convenient for buyers and suppliers to have proper communication and keep a track of their order. By utilising an automated and responsive system, suppliers can bid faster and purchasers can assign the order with the best quote. The complete process is visible to all parties. It saves a lot of time, ensures optimal cost and comes with a speedy resolution for grievances. In the end, you will enjoy real-time bidding, cost savings, evaluation of suppliers and healthy relationship with them.
Simpler contract management
It is quite obvious that a company works with multiple vendors. Maximum time, the terms and conditions remain the same. With the help of procurement automation, the contract can be kept in a central database that can be accessible with a single click. It increases the speed of the onboarding process for current suppliers. It makes sure that all terms, guidelines and conditions remain the same in all the contracts. Automation bestows standard contract templates and lessens error and time in managing the contract.
Improves the overall productivity
By placing automation is the entire procure-to-pay cycle, and keeping all the work aspects accessible, the employees can get real-time updates about procurement cycle. With an automated system, the stakeholders get more time to concentrate on strategic work because manual labour is not required anymore. They can gain access to all information without going through multiple systems. This strengthens the decision-making process and boosts productivity. The increased efficiency offers better control of the whole procurement cycle as it removes the error and time-consuming methods.
Now that you know why it is important to place automation in the company’s procurement system, you should know on which systems automation must be placed.
Which processes require automation?
Automating the process of purchase requisition makes sure that the purchase requests do not get delayed as someone is not present in the office. Automation reduces the time taken for requisitions to be approved and eliminate redundant steps in the overall method.
Current surveys show that almost half of companies found out that they have scarcity in spite of having a normal purchase order system. Automating the process of purchase order lets the organisation automate the overall buying order cycle to bring more efficiency and productivity.
In a manual contract management process, the contracts are stored in a cabinet or a hard drive. It is disorganised and unstructured. Procurement automation arranges all contracts in a database. The contracts stay consistent and accurate and can be accessed quickly.
Relationships with vendors can be easily strained without proper communication. Automation lets teams organise the vendor selection and pick the best one available. Companies will quickly recognise an issue and resolve it form a better relationship with the supplier, which will lead to long-term cost savings.
When it comes to managing invoices manually, the employees have to deal with delayed submissions, purchase made outside contracts, poorly managed buying orders and missing good receipts. The staff may also deal with complicated spreadsheets. Handling invoices manually means compliance issues and delayed payments, upsetting the vendors. With automation invoice management, it will drastically improve the entire scenario. It will approve the invoices that match the buying order and goods receipt.
These are a few processes that require automation. Once placed, you will see a change in the entire workflow. The methods will be streamlined with fewer mistakes, and the procurement team will receive all the updates. To organise the work of your company, opt for automation.