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Procurement

5 Steps You Need to Take While Preparing to Automate Procurement Operations in Your Company

31.01.2022

Procurement process often involves lots of paperwork that gets passed along to different hands. If done manually, this can become repetitive and time-consuming in the long run. Fortunately, you can now automate procurement processes through software solutions. This offloads administrative tasks so that you or your employees can focus on making strategic decisions and building relationships with suppliers. 

Importance of procurement process

Having an efficient procurement process is vital to businesses regardless of size and type. Decisions you make during procurement have a direct impact on your business “bottom-line” and revenue. For example, by identifying better and cheaper sources of supply, you can reduce cost and increase your profits in the process. It is because of this that many organizations place the head of procurement at an Executive Board level.

More businesses are also taking their procurement process to the next level through digitization. Through the help of an e-procurement software, you can transform your procurement process and make it more accessible and efficient. Embracing digital transformation allows you to incorporate automation into your workflow with ease. 

Benefits of automation in procurement

Streamline your procurement process using procurement software. This will provide you with tools so that you can automate various tasks in your procurement such as:

  • managing suppliers
  • tracking purchase orders
  • overseeing proposals and contracts
  • leveraging data and analytics

There are many benefits to automating your procurement process. For one, it reduces cost by up to 50% each month. It can also increase your employees’ productivity since it takes over some of the menial and repetitive tasks from their workload, allowing them to focus on other value-adding tasks. In doing so, it maximizes employee engagement and collaboration when it comes to making purchase decisions.

Automation can also shorten the procurement lifecycle by removing bottlenecks from your process. It can also eliminate manual errors such as duplications in purchase orders, miscommunications with suppliers, and typos in data-entry tasks. As a result, you can also eliminate transaction disputes in the process. 

Larger enterprises also implement top ERP software solutions to streamline their operations further.

Preparations to make before implementation

1. Evaluate current procurement process

Before you set out to implement automation into your procurement process, you must first evaluate your current system to determine what and how to automate. Reviewing your current procurement process helps you identify the issues in your current strategy, the bottlenecks in your workflows, and the challenges that your procurement team faces. In doing so, you will know what procurement processes to automate.

Start by looking at each aspect of your procurement process to know what each struggle with. For example, your biggest challenge when it comes to vendor management is onboarding new vendors. Meanwhile, when it comes to managing purchase orders, most of the bottlenecks can be found in the approval stage. 

Having a systemic sweep over your current procurement process gives you specific ideas of how you should incorporate and fully maximize the use of automation in your current workflow.

2. Find the right software for your business

Another factor to consider is your business needs. This means going beyond the current system or strategy in place for your procurement process. You must also think about the general demands and limitations set by the current condition of your business. This includes:

  • Company size
  • Type of industry you are in
  • Available resources
  • Level of technical knowledge of your employees
  • Number of suppliers/vendors you are working with

Each company has its own set of needs. Hence, there is no such thing as a one-size-fits-all procurement software solution. What works for one might not necessarily work for one. For example, the best procurement software for small businesses might not be able to keep up with the large-scale procurement operations of enterprises. Likewise, pharmaceutical companies might need more niche-type procurement software compared to retailers. Check out this review of CompareCamp about Kissflow Procurement Cloud to know how it is best suited to your business needs. 

3. Create an implementation plan

Incorporating automation into your procurement process brings about big changes in your workflow. Hence, you need to ease into the transition systematically rather than just diving headfirst into the implementation. The best way to go about it is to plan ahead before you start moving your purchase orders and other related data into a new system.

You can start by creating a checklist of what you will need for the implementation. For example, you should look into whether you have the right hardware to support the software that you plan on investing in. It can also be a step-by-step account of how the implementation should go about. For example, you can include in your checklist your plans of integrating your procurement automation software with other software in your digital ecosystem. Likewise, you should make sure that you have all the necessary files and data backed up beforehand in case something goes wrong during implementation.

Having a plan beforehand ensures that you won’t skip an important step in the implementation process.

4. Orient employees on its purpose and usage

The most affected by the introduction of automation into your procurement process will be your employees—specifically those who will be using it. Hence, it is important that you orient them beforehand. Be transparent about why the company needs to automate the procurement process, how it can help them, and what are your expected outcomes after such implementation. This will help your employees understand the purpose behind such decisions and appreciate the merits of adopting automation into their workflows.

You should also train your employees on the usage of the software you plan on using. After all, not everyone can be tech-savvy enough to figure out how new technology works. Hence, you need to make sure that your employees can get the help they need to adjust to the new system. Fortunately, some procurement software companies provide accessible documentation and guides that you can use for your employees’ training. There are even others that offer demo sessions and webinars. 

5. Keep track of results and feedback

Upon the implementation of automation in your procurement process, it is important that you measure its impact on your overall performance and growth. You can do this by keeping track of results and feedback.

According to Deloitte, cost savings are the primary driver for performance measurement in the procurement process. Hence, you should pay attention to how automation was able to impact your revenue, “bottom-line”, and profits.

Likewise, you should hear from your employees themselves on how automation affected their performance. Is automation making their job easier? Did they become even more productive after its implementation? How has it impacted their workflow?

By noting the changes brought by automation, you can decide whether to push through with it or adjust your implantation plan.

Next level procurement process

Procurement is a vital aspect of any business. And yet, many procurement teams remain reliant on paper-based systems rather than embracing digital technology. Level up your procurement process by investing in top procurement software like Kissflow. This will help you automate tasks and streamline your processes.

About Kissflow Procurement Cloud

Kissflow Procurement Cloud is a flexible procurement software that enables businesses of all sizes to streamline their procurement processes. Its modules include purchase orders, purchase requisition, vendor management, purchase invoicing, analytics, and integrations, all in one unified platform. If you’re transitioning from manual procurement management tools or replacing disparate systems, look no further than Kissflow Procurement Cloud.