Improving Supplier Management with SaaS E-Procurement
Improving Supplier Management with SaaS E-Procurement
When a major North American facilities management company started receiving complaints from clients regarding their supplier management processes in 2012, they wasted no time in addressing the problem directly. The company immediately ordered a review of their supplier management procedures with the intention of identifying areas where existing protocols could be improved, as well as any aspects of the supplier management process that could require an entirely new approach.
The concerns voiced by vendors had mainly focused on a lack of transparency and inefficient processes employed by the company during bid publishing, solicitation and awarding. The results from the comprehensive review indicated that many elements of the firm’s processes were indeed ripe for change.
Instead of attempting to address each individual concern with a granular process fix, the company decided to approach the problem in a holistic manner and fundamentally change the way they manage their large pool of suppliers. To this end, it was determined that the most cost-effective long-term solution to all of the identified issues would be the integration of an e-procurement system.
Supplier Management Challenges and E-Procurement Solutions
Electronic procurement was the clear choice to address all of the concerns raised about the efficiency and transparency of the company’s supplier management protocols. Before adopting e-procurement, suppliers were managed using an internally developed system, one that ‘got the job done’ in the most basic sense but failed to optimize the management process in a way that allowed for true transparency and real cost savings.
Importantly, the company’s internal system did not allow for pre-qualification of suppliers by experience, location, or certification, leading to a labor-intensive process for employees seeking to qualify individual suppliers from their pool. Other functionality that was lacking in the company’s system included the ability to securely distribute documents and addenda electronically, flexible options for data display and reporting, as well as automated communications tracking and auditing capability. These powerful and necessary features were all integrated into supplier management processes as a result of acquiring a software-as-a-service (SaaS) e-procurement solution.
The previous concerns associated with supplier management were not the only issues to have been addressed by the company’s integration of electronic procurement. The robust selection of management modules available within the e-procurement system allowed for the creation of customized workflows, individualized dashboards and per-project data access, providing both high-level and granular views of projects in a secure environment. Supplier performance can now be graded using custom score-carding, allowing managers to integrate crucial objectives into project overviews. For auditing purposes, a complete data trail of all project information can be archived for a period of up to 7 years and accessed with a few clicks to generate managerial reports with ease.
After Onboarding
Once the e-procurement solution had been implemented at the facilities management company, the benefits began to present themselves immediately. Clients who had previously voiced concerns regarding supplier management processes responded enthusiastically to the new system: in 2013 alone, over 1000 major projects have been completed at the company using SaaS e-procurement. Moreover, in excess of 1300 suppliers have since been qualified to bid on solicitations through the system’s pre-qualification module.
Now that electronic procurement has set the performance standard within the organization, the benefits will continue to be enjoyed in the future. Data security, document distribution, and supplier communication during the purchasing process will all require far less effort on the part of the buying organization moving forward, and the long-term reduction of departmental spending can only benefit the bottom line.
Electronic procurement has proven to be the solution to an entire suite of problems within the purchasing department of a major organization. What can a SourceSuite e-procurement solution do for your business?
Nathan Munn | SourceSuite.com
