Fraxion's PunchOut functionality, integration with suppliers like Amazon can assist your business and control eProcurement and spend management...
Does your current procurement process consist of files of paper-based purchase requests or numerous email threads requesting approvals, often delayed by managers who are out-of-office or non-responsive? Are you manually tracking spending against budgets across multiple spreadsheets after-the-fact? Is overspending and unauthorized purchasing occurring in your organization? It could be time to consider eProcurement software.
What is eProcurement software and how can it help your business?
Gartner defines eProcurement software as “applications that support indirect spending by giving casual users (i.e., employees who are not procurement professionals) a self-service solution for requisitioning and ordering goods and services.”
What could the deployment of eProcurement software mean for your business? An empowered team, equipped with efficient tools to easily request and order necessary goods and services from preferred vendors, while complying with company policies and budgets and ultimately, being accountable for what they spend.
Let’s explore exactly what to look for in eProcurement software and how it drives this level of operational efficiency and proactive spend management.
Features to look for in eProcurement software
1. Ease of use
The success of any software investment hinges on user adoption. In finding the best eProcurement system for your business, be sure to identify solutions that are intuitive and user friendly, requiring minimal training to get started. Solutions with handy tool tips, alerts, and notifications will further enhance usability, making it easy for users to purchase what they need to be effective, while complying with policies, and saving time. Ease of use and the user adoption that follows will drive the results you require from your eProcurement software investment: procurement efficiency, compliance, visibility, and spend management.
Choosing to deploy cloud-based eProcurement software can enable the mobility required to empower procurement efficiency and control across any operating model; from remote and hybrid workforces to office-based teams that travel or are out-of-office occasionally.
By giving your team access to cloud and mobile app-enabled eProcurement software, they can submit purchase requests from any device and location, while managers with permissions can review budgets and instantly approve or reject requests with the same accessibility. This mobility significantly accelerates process cycle times, reduces delays, and bottlenecks, and improves collaboration between employees and departments. Staff on leave or out-of-office can still action tasks or assign a proxy to do so on their behalf.
3. Process efficiency and optimization
Manual and paper-based processes have common outcomes: inefficiencies, human error, and inaccuracies. An employee captures incorrect data in a spreadsheet or fails to save their changes. Another goes on vacation and doesn’t approve purchase requests before they leave. The list goes on.
eProcurement software digitizes procurement processes, automating workflows and notifying users when action is required throughout the process. Examples of procedures you can expect to be optimized by automation using eProcurement software include:
● Supporting document uploads
● Escalating approval workflows
● Real-time budget tracking and visibility
● Purchase order (PO) generation from approved requests
● Change orders and approvals
● Vendor approval
● Invoice approval
● Receiving and 3-way matching
● Internal product catalogs and online catalog integrations
● Reporting and spend analytics
● Audit logs
With eProcurement software you can streamline requisitioning, approve with confidence, access digital documents to verify purchases, automate the purchase order (PO) process, approve invoices, and acknowledge receipt of goods to mitigate these risks:
● Unauthorized expenditure
● Paying for goods not received
Digitizing your procurement process keeps your workforce moving while business leaders maintain oversight and financial control.
4. Spend visibility and analytics
When choosing the best eProcurement system for your business needs, look for a solution that offers advanced analytics and reporting capabilities. With centralized access to current and historic purchasing data, i.e., spend visibility you can easily review budget vs actuals, consolidate POs to capture more savings, or review spending by cost allocation and financial period to identify saving opportunities and reduce the right costs.
You can analyze spending and the efficiency of your purchasing process with reports that measure:
● Approval times
● Purchase order cycle times
● Committed and available budgets
● Spend by vendor
● Spend by employee
● And more!
The spend analytics and reporting efficiencies that eProcurement software provides are unmatched when compared to admin-intensive spreadsheet tracking across multiple sources. With purchasing processes, records, and transactions in one centralized platform, analyzing your spend is simplified. From users having an overview of their spending and its impact, to managers having the tools to analyze and report on departmental spend by employee, budget and vendor, the software empowers users to make informed decisions and in turn, fosters a cost-conscious and accountable spending culture.
5. Internal controls
When implementing eProcurement software, you can configure internal controls based on your company’s spending policies, delegation of authority and spending thresholds for approval workflows. With eProcurement software, policy compliance is easily attainable as internal controls and alerts flag potential risks and contraventions, guiding users to make better purchasing decisions.
In stark contrast, where paper-based or manual processes are in play, companies are at a much greater risk of fraud and unauthorized expenditure with no oversight or ways to proactively manage purchasing. With eProcurement software, each purchase has a digital audit trail throughout a transaction’s lifecycle. This not only promotes accountability but improves auditability with centralized purchasing records and digital audit logs.
In managing budgets, eProcurement software simplifies real-time spend tracking against cost allocation budgets, project budgets, grants, or funds. Authorized managers have access to available and committed budgets at decision points, empowering faster and more astute decision-making when approving purchase requests.
eProcurement software is a reliable and efficient method of implementing controls that manage policy and budget compliance company-wide, improving spending behavior, reducing operational costs, and curbing overspending.
6. Vendor management, catalogs, and integrations
Ensuring that your team purchases from approved or contracted vendors can be challenging when you’re relying on manual processes that lack control. eProcurement software can help you maintain strong relationships with vendors and maximize value from pre-negotiated contracts. By purchasing more from approved vendors, you could be eligible for volume discounts and early settlement benefits. Leveraging vendor spend data in contract negotiations could help you qualify for more favorable terms.
With eProcurement software you can:
● Manage vendor onboarding and approvals.
● Consolidate purchase orders to take advantage of bulk discounts.
● Track and manage open purchase orders with vendors.
● Analyze spend by vendor and identify saving and supplier consolidation opportunities.
● Identify when unauthorized or uncontracted vendors are linked to purchase requests and decide whether to approve, reject, or suggest an alternate vendor for the purchase.
● Configure quoting steps to ensure purchasing from a vendor that offers the best value.
Catalogs and integrations
Furthermore, internal catalogs can be set up and maintained within the system, displaying products and pricing from strategic vendors, enabling an easy and compliant shopping experience for users.
PunchIn or PunchOut catalog integrations can further simplify business purchasing with direct access to a host of eCommerce sites from your eProcurement system. The integrations simplify and accelerate purchasing; there’s no need to maintain catalogs, and once items are added to your cart and submitted, they are subject to your eProcurement software’s requisition, approval, and PO process, with budget and policy checks.
The best eProcurement systems will enable these vendor management and integration capabilities that save time, reduce rogue spending and drive cost savings.
eProcurement software ROI and time-to-value
Deciding to deploy eProcurement software ultimately comes down to three factors for most businesses: affordability, return on investment (ROI) and time-to-value. All three boxes can be checked by selecting a best-of-breed eProcurement system. These niche cloud solutions are accessible via affordable SaaS pricing models that enable solutions to scale as companies grow. The software can be deployed remotely, and companies can be up and running in less time than a full suite or ERP implementation that requires more resources, time, and change management for such large-scale software implementations.
By integrating eProcurement software with existing cloud or legacy financial systems, you can achieve procure-to-pay accuracy and efficiency in a shorter turnaround time.
With complete oversight, purchasing control and efficiency, eProcurement software (standalone or integrated) can drive sustainable savings that provide time-to-value and a return on investment (ROI) in quick succession.
eProcurement software can revolutionize your procurement process
Replacing paper-based or manual processes with cloud eProcurement software can digitize and streamline your procurement process from end-to-end, eliminating admin-intensive processes, improving collaboration between employees, and providing internal controls and complete visibility for effective spend management.
In summary, in choosing the best eProcurement system for your business, be sure to look for solutions that can:
● Simplify tasks and improve procurement process efficiency on the-go.
● Provide purchasing insights, spend visibility and analytics.
● Enable, manage, and analyze purchasing from approved vendors.
● Ensure procurement policy compliance and budget control.
● Improve auditability.
● Provide measurable operational cost savings.
How Fraxion can help
Fraxion’s cloud eProcurement software is helping mid-size companies worldwide to achieve procurement efficiency with easy digital processes, complete visibility and advanced spend analytics. The system’s proactive spend controls have helped companies reduce their operational costs by 15 - 20%.
To see the eProcurement software features working in scenarios customized to your business requirements, request a Fraxion demo today.