Procurement, once seen as just a cost-cutting function, has now evolved into a major supply chain component for businesses.
CPOs and procurement personnel who are responsible for sourcing critical goods and services are also tasked to create quick turnarounds and devising alternatives to avoid bottlenecks, to reduce vulnerabilities.
The current added procurement function is to enhance supply chain resilience to overcome vulnerabilities due to lack of visibility and flexibility which is predominantly due to legacy process and solutions.
E-procurement is shown to increase productivity and transparency while reducing costs.
1- Process Streamlining and Simplification: E-Procurement automates and simplifies the purchasing process and increases transactional speed. This results in the elimination of redundant processes, reducing turnaround time and increasing efficiency
2- Increase transparency: E-Procurement provides a higher level of oversight on the purchasing process and spending, thus reducing maverick buying and increase cost savings.
3- Enhancing spending oversight: E-Procurement platforms enable effective budget planning and implementation of sourcing strategies. This enhances spend forecasting through detailed reporting of spending data. Thus, increasing the procurement team’s decision making capabilities i.e where to source from and how much to spend.
4- Enhance supplier management: E-Procurement platforms improve compliance by improving controls, ensuring buying is not conducted outside proper procurement channels.
5- Real-Time data to ease decision making: E-Procurement platform enables real-time data that facilitates buyers to make informed spending decisions and plan for the future. This enhances strategic buying oversight, especially for commodities that go through price fluctuation based on socioeconomic environment.