A Guide to eProcurement for the Non-Profit Industry
Regaining Control over Spend with Advanced eProcurement Software
Written by: PayStream
Underwritten in part by: Paramount WorkPlace
Q2 2017 | Featuring insights on:
- Current Market Trends in Procurement Processes Among Non-Profit Organizations
- The Benefits of Procurement Automation for Non-Profits
- Features and Functionalities of Leading eProcurement Solutions
As today’s business environments become more complex, competitive, and regulated, organizations face many processing challenges in their back-office departments. In procurement processes, companies must carefully monitor and fully control all aspects of indirect spend in order to maintain low costs—and ensure profitability. Without the proper controls in place to monitor employee purchasing, organizations leave themselves open to the risks of inefficient spend management, exceeding budgets, and non-compliance with legal requirements.
Indirect spend issues are especially vital to control for organizations in the non-profit sector. For non-profit organizations to stay financially and legally compliant with the regulations of their industry, all purchases and payments must be carefully tracked, and reported with complete accuracy and full disclosure. It is also important to keep processes efficient, cycle times short, and costs low, as non-profits depend on strict budgeting to stay afloat. Unfortunately, PayStream’s research has found that many non-profit companies still rely upon manual procurement processes, which perpetuates some of these difficulties.
One of the best ways for any organization to improve inefficient procurement processes is by adopting an advanced, automated eProcurement solution. eProcurement technology can help bring process improvements vital to non-profits’ spend management operations—control, transparency, and greater data accuracy. This whitepaper explores some trends in procurement management among today’s non-profit organizations, and highlights the features of eProcurement technology well-suited for non-profit organizations.
A Look at Non-Profit Procurement
In order to identify procurement trends among North American organizations, PaySteam Advisors surveyed over 400 organizations across a variety of industries and market segments. Survey results show that non-profit organizations are typically less automated and less efficient than the nationwide average. Compared to most U.S. companies, non-profit organizations are less likely to have adopted eProcurement software, see Figure 1.
Most non-profits use manual-based methods, such as spreadsheets or email, to keep track of purchasing information and communicate regarding orders. For example, when it comes to placing orders, survey results show that the majority of non-profit organizations send POs via email, see Figure 2.
Heavy dependence on manual methods contributes to processing challenges for non-profits, especially when approving requisitions and completing order lifecycles. When organizations were asked how long it takes for their department to approve a requisition, non-profit respondents reported longer requisition approval cycles than many other industries, see Figure 3.
In addition to lengthy approval cycles, non-profits experience issues controlling and gaining visibility into spend, processes, and information—all issues that are particularly important. When asked about their top procurement goals, most non-profit organizations reported that they want to improve processes around data accuracy, visibility into spend, and contract control, see Figure 4.
Fortunately, eProcurement software helps non-profit organizations accomplish these exact goals. Among non-profits that have automated procurement, most report improvements in transparency, cycle times, and control, see Figure 5.
In order to help non-profit professionals find a solution that helps them improve processes and meet their goals, the following section highlights the features and functionality of eProcurement specifically tailored to the non-profit industry.
eProcurement for Non-Profit Success
Standard features in leading eProcurement technology include requisition creation and workflow tools, access to supplier product catalogs, purchase order creation tools, order lifecycle management, and integration with accounting and ERP systems. These functions streamline the full Procure-to-Pay lifecycle, helping companies maintain visibility into and control over employee spend, as well as optimizing their purchasing processes. The solutions are also simple to adopt, with many offering extensive API capabilities for integrating with existing accounting and other financial systems.
Different solutions and providers offer different features, and it is important that a company selects a solution designed to accommodate their unique business needs. Non-profit organizations should look for a provider with experience working in the industry, and offers a solution tailored to its specific requirements. Non-profit-tailored solutions include the following features and characteristics: