INVESTING IN BACK OFFICE EFFICIENCIES
Procurement Management – Building Value by Cutting Costs
by Salim Khalife, Founder & CEO
Economists and business analysts often debate whether reducing costs or increasing revenues are bigger contributors to a company’s profitability. Companies tend to focus their investments in digital technologies on revenue generating, forward facing business activities such as sales, marketing and order-to-cash, often neglecting non-revenue generating, yet critical business activities such as procurement and spend management. It’s understandable perhaps, but smart companies understand that skillfully eliminating waste and inefficiencies and cutting costs should be the goal of every department.
Digital technologies bring tremendous efficiencies to back office, non-revenue generating activities, helping companies remain lean, green and successful. Here are three ways one digital technology – procurement and spend management software – builds value in the organization by eliminating waste, reducing costs and improving administrative efficiency.
1. Bring more spend under control
Bringing more company spending under direct control by your procurement team is a giant step toward efficiency. And the technology to help centralize your purchasing functions is procurement and spend management software. With all direct and indirect spending routed through the same system, you can leverage your buying power, minimize waste and drive efficiency into the process. Plus, you’ll gain visibility into the purchasing cycle that you just can’t get with manual or disconnected systems. That increased visibility will allow you to identify and address bottlenecks and barriers that cost your company time and money.
2. Eliminate waste and reduce costs
Since procurement departments are cost, not revenue centers, we must work doubly hard at keeping costs under control. Procurement and spend management software can help you reduce costs and eliminate waste by facilitating a competitive bidding process, streamlining approvals, speeding order processing, enforcing vendor-negotiated terms, and automating invoice distribution.
3. Improve efficiency and collaboration
Legacy systems, spreadsheets, email and manual processes are some of the ways many companies manage their procurement activities. These informal (and inefficient) techniques may work well enough for the smallest companies, but growing companies need dedicated technology tools made for the task. Procurement and spend management software solutions build efficiency and improve collaboration by replacing outdated and overly complicated workflows. For example, Mobile catalog shopping empowers employees to shop from selected lists and initiate requisitions from their mobile devices. Managers can review and approve requisitions from the app, speeding the process and eliminating paper and manual processes. And Dynamic rule engines and configurable approval workflows keep the procurement process flowing, and ensuring all stakeholders remain informed and involved.
When procurement functions are aligned with your organization’s overall business vision and powered by efficiency-driving technology, the rewards are significant. Paramount WorkPlace effectively and efficiently 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.