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1st Feb 2021

4 Critical Procurement Challenges and How to Overcome Them

There is never a dull moment in procurement; procurement managers are juggling different tasks simultaneously. The entire process of procurement involves many ongoing or instantaneous steps: procurement orders, supplier details, budget management, and the main actual purchase as well.

With a plethora of intricate steps involved, the procurement manager’s job is riddled with challenges. As procurement has direct impact on the bottom line of company, the money, resources, or time spent on identification and rectification of challenges is not a lost cause.

Let us identify key challenges faced by procurement managers and explore must-have features of a modern, agile, well-integrated eProcurement solution.

1.     Higher chances of fraud

Proper check over vendors and other key stakeholders of the entire procurement process is difficult to maintain over the offline process. When everything happens on paper, dealings are not transparent, leaving a huge window of malpractice. Fraud harms profitability and productivity all across the organization.

2.     Supplier-management issue

Absence of efficient supplier management is one of the grave challenges of procurement. From choosing a suitable supplier to monitoring vendor performance and guaranteeing a secure and stable supply of high-quality products, the procurement process is intricate. It becomes even more complex when all of this is happening offline.

3.     Imprecise data

Making key purchase-based decisions based on inaccurate results in either too much or too little inventory, or other obstacles has tendency to hurt your company’s bottom line directly. Companies that don’t have real-time updates on quantities, delivery schedule, and prices results make faulty decisions based on inaccurate data.

4.     Lengthy procurement cycle

Companies that don’t have a simplified and automated contract management process and no dashboards or reports to monitor KPIs and metrics in near-real-time have longer process cycles. Often products and services are procured as a last-minute thing, which results in a considerably longer procurement cycle.

 

The vital components of an ideal eProcurement solution

In this day and age, you don’t see yourself sifting through thousands of documents to understand your company’s budget. The very idea of tracking suppliers’ performance while relying on manual, traditional methods is downright unpractical. Leverage the countless technologically advanced tools at your disposal and achieve optimization and precision.

Here are some of the must-haves of an ideal eProcurement solution:

1.     Easy integration with ERP platforms

Some platforms consist of modules that support the full procurement cycle; they allow companies to carry out end-to-end processes without adopting standalone or third-party components. Whereas, some eProcurement solutions are designed on a unified data platform, which easily integrates with various ERP platforms to guarantee constancy.

2.     Close monitoring of data

A paper-based procurement process environment makes it challenging for organizations to overlook something as simple as total spending. They have to dig in a variety of databases to gather data about invoices, past transactions, contracts, negotiated amounts and so much more.

However, modern eProcurement solutions cumulate real-time data from within the solution and even outside sources into a central database. Whenever needed, the procurement team can process the required information by solely entering a piece of the query. Not only this is a trusted method of reporting, but it is also less time consuming and more effective.

3.     Efficient contract management

Contract management is the backbone of any awarding procurement process. It is laborious yet crucial to manage the performance requirements of contracts for integration projects. You can dedicate some space in your office or resources to administer contract management and enforce rules for better results. However, an efficient eProcurement system can help centralize contract-related data, enabling a clear and detailed view of contract requirements and obligations for your managers. You can even set alerts or notifications when crucial factors, such as spending or delivery schedule reach a threshold.

 

Empower your business with Techvista eProcurement Solution

eProcurement Solution by Techvista is a single, secure platform to enhance vendor engagement and automate the procurement process. The goal is to have software that effortlessly enables procurement teams and supply chain executives to automate manual processes, reduce redundancy, simplify the onboarding process, and streamline vendor management.

Our solution is a two-way integration between the vendor portal and Microsoft Dynamics 356 or even Microsoft Dynamics AX. Vendors can easily download any user guide and submit invoices online. As every step of the contract management process is simplified and automated, therefore it reduces administrative workload.

By addressing the core procurement-related business problems, with this solution, you can nip your procurement integration issues in the bud. Whether you are an emerging tech company with numerous invoices from different suppliers, or a blooming eCommerce business with massive stock turnover, or a simple company that requires assistance with payments, Techvista’s eProcurement Solution can provide you with a complete view of every stage of the procurement process.

Get in touch with our experts to simplify and optimize your procurement process.