Top 5 Procurement Challenges Facing Enterprises in 2017
And How To Solve Them
by Salim Khalife, Founder & CEO
1. Finding and Evaluating Qualified Suppliers
With so many purchasing options, how do you find the sellers that are doing it right? We cannot base purchasing decisions on price alone – speed of delivery, larger product offering, overall suitability to the application, and vendor service levels are also paramount.
2. Handling Invoice Variances
If you process a large number of low-dollar purchase orders, spending staff resources to manually review and scrutinize variances is not cost effective. You simply don’t want to spend an hour to find a twenty-cent difference between a purchase order and an invoice. Using defined invoice matching variances, to automatically match invoices that are above or below a certain threshold, saves the Accounts Payable staff valuable time during the invoice matching process. This is a very effective function, and one not included in most procurement systems.
3. Reducing Costs and Generating Savings
Cutting costs is a common challenge across every business function, but it is even more challenging when your core business function is to spend money! As a procurement manager, you must be able to demonstrate that you’ve performed due diligence in seeking quotes, analyzing vendors and proposals, and managing the entire purchasing process.
4. Eliminating Un-Managed Spend
You cannot monitor what you don’t manage. When large classifications of purchasing are left unmanaged, we introduce vast inefficiencies and lose opportunities to save time and money as well as increase our own service levels.
5. Proving Our Relevancy and Contribution to the Bottom Line
Procurement is often seen as a necessary, but not strategic, component of business operations. While we see this perception beginning to change, it’s always a challenge to prove our relevancy, to demonstrate that procurement management is an integral part of corporate performance, not simply a series of necessary transactions.
Technology Tools Provide the Solution
Many business challenges can be effectively solved with technology tools, and procurement challenges above are no exception. Procurement management software can help automate the entire requisition and procurement process, compare proposals, track vendor performance, reduce un-managed spend, gain real-time visibility and control, and deliver a strong, demonstrable ROI across your entire organization. When integrated with your ERP solution, your organization’s purchasing data is transmitted quickly, and is instantly available on financial and operational reports.
Paramount WorkPlace effectively manages all aspects of the procurement process. See it in action here.
About the author:
Salim Khalife is the founder, president and CEO of Paramount WorkPlace, a technology company that develops, sells, and supports advanced web-based and mobile requisition, procurement, and expense software solutions for mid-market organizations. The company introduced its first cloud-based SaaS requisition application in 1997, and continues to innovate and expand its partnerships and integrations ever since. Learn more at www.paramountworkplace.com.