As the role of procurement continues to increase in scope and importance across organizations, more people are looking at exactly what makes great procurement professionals. While there was a time when procurement was an afterthought for many organizations, its increased role means organizations are looking for talented individuals who can deliver the results needed to thrive. Because countless organizations simply don’t know what they should look for in a procurement professional, we want to provide some clarity by highlighting the five traits that matter most:
Contracts are crucial for enterprises. Without them, there wouldn’t be a way to cement the relationships that enterprises have with their suppliers. Given that suppliers are the source of goods and services that enterprises require to remain functional, it’s easy to understand why contracts are something that need to be taken seriously. Although contracts serve a very important function for enterprises, that doesn’t mean they’re always handled properly.
Regardless of the size of a company or its specific industry, the activities of procurement and accounts payable impact each other. Because of this link, a company’s goal should be to maximize the efficiency of both departments. Doing so has very clear benefits, especially in regards to the procure-to-pay process.
One of the best ways to reap all of those benefits is to automate procure-to-pay activities. Purchasing automation offers efficiency and speed improvements that simply aren’t possible through any other means.
Automation directly impacts procurement staff. Once automation is introduced into this environment, it provides procurement professionals with what they need to operate at a higher level of both efficiency and productivity. What’s even more appealing about those gains is they can then help to reduce the staffing costs that go along with processing orders. Instead of spending large amounts of time on basic tasks related to the purchasing process, members of this department can focus their attention on activities that create far more value.
Key Benefits of Procure-to-Pay Automation
Once procure-to-pay processes are automated, a business will notice faster cycle times. The second notable benefit of purchasing automation is increased efficiency for purchase order processing. Because an automated system takes care of routing information in the most efficient way possible, previously wasted time caused by communication inefficiencies is eliminated.
The third benefit that’s very meaningful for businesses is that procurement employees are able to process significantly more purchase orders. That benefit stems from purchasing automation directly assisting with common tasks like purchase order generation.
Another benefit that goes along with automating procurement is a reduction in supplier lead times. The clear and consistent data sharing provided by automation ensures that suppliers have everything they need to avoid delays.
Moving Towards Purchasing Automation
Once businesses learn about all of the benefits that procurement automation has to offer, they generally want to learn more about what it takes to make this transition. When this topic comes up, it’s generally a good time to review the current strategy that’s in place for managing procurement. Looking at the current state of areas like receiving and invoicing provides an opportunity to identify key areas for improvement.
The good news about purchasing automation is not only is it very beneficial, but it’s easier to implement than many companies expect. With the right purchase order software, companies can get all the features they need. From customized work flows to purchase order generation, quality purchasing software puts all the power of automation into a straightforward interface.
A purchase order (PO) plays an integral part in the purchasing process. This document lets a seller know that a buyer is ready to place a formal order. Because this document does serve as a contract between the buyer and seller, it’s important for it to include all relevant information.
It’s critical for the price to be clearly stated on the PO. Since it’s common for buyers and sellers to negotiate price, the PO needs to show the price that was agreed upon. If a purchase order doesn’t include price information, it won’t be helpful later in the event of a dispute.
In terms of areas where buyers can gain leverage for negotiating, quantity is at the top of the list. Simply put, higher quantities make sellers more willing to negotiate on price and other terms. One of the many benefits of purchasing software is it makes it easy to ensure orders are made together in maximum quantity instead of being spread out across multiple smaller orders.
Latest Ship Date
One of the most common mistakes organizations make with purchase orders is failing to negotiate a latest ship date and then putting that date on the PO. Knowing the absolute latest an order will be sent out is the only way to know when it will be available to actually put into inventory.
Terms of Sale
In addition to pricing, a well-done purchase order should cover all other relevant terms of sale. From how payment will be handled to specifying expected quality, using a purchase order to cover these details ahead of time is the best way to avoid a future dispute.
During the rush of trying to put together a purchase order, it’s easy to overlook seemingly small details like marking requirements. However, overlooking this detail can result in products getting stuck in customs. To avoid that type of delay, ensure that all required markings are specified on the purchase order.
Purchasing Software Simplifies Purchase Order Generation
There’s a lot that goes into correctly preparing a purchase order. As a result, the process of preparing one manually can take up a lot of time. For businesses that want to ensure this task is done correctly and maximize efficiency, purchase order software is the ideal option.
With the help of software, purchasing managers and anyone else involved in procurement will have everything they need at their fingertips. Not only do customized work flows make preparing and generating accurate purchase orders a breeze, but this type of software streamlines numerous other tasks like vendor research and vendor negotiations.
Even though it has many common characteristics of a buzzword, the cloud has proven itself to be a lasting shift across the business landscape. As costs continue to come down and options mature in the functionality they provide, businesses continue to shift their operations to cloud platforms.
If your company is exploring different cloud opportunities, we have several important considerations to share with you:
There’s a lot to be said for businesses that are able to maintain agile operations. Even as a business grows, staying agile can provide a significant competitive advantage. One big selling point of the cloud is it supports an agile approach to doing business. Because the cloud makes it possible to keep information shared and updated across an entire organization, it’s possible to avoid the types of communication barriers that can start to slow down a business as it grows in size.
Falling Costs and Increasing Functionality
A big part of why so many businesses choose to move forward with their transition to the cloud is because the numbers make so much sense. As competition continues to increase among cloud vendors, prices continue to be pushed down. The attractive pricing options for cloud technology makes it all that much easier for businesses to transition. What’s really great for businesses that want to use cloud technology is the increasing competition also means vendors are providing as many useful features as possible.
One thing that often gets overlooked in discussions about businesses and the cloud is this transition doesn’t have to be an all or nothing choice. Instead, businesses can take advantage of focused offerings to move the parts of their operations that make sense to the cloud.
Although there are exceptions, this type of targeted transition is generally the best option for the majority of small to medium businesses. The reason this approach works so well is it allows businesses to take advantage of the best cloud technologies that are available without facing any type of large technical hurdles.
A great example of a piece of focused cloud technology that can greatly benefit businesses is purchasing software. Because the purchase order software offered by Bellwether is 100% web-based, it’s easy to access from anywhere. Not only is this software specifically designed to give purchasing managers everything they need to be as efficient as possible, but it makes it possible to customize to specific needs.
From easily automating purchasing processes to enforcing budget thresholds, our cloud software is the top choice of small and mid market purchasing managers. Best of all, the fact that it’s based in the cloud means that it doesn’t require IT support. If you want to see exactly how our cloud solution can help your business save money through increased efficiency, we encourage you to take advantage of our 30 day free trial or let us walk you through a free live demo.
In general, the sales cycle for B2B offerings is significantly longer than it is for B2C. From initial contact through pitches to negotiations, there’s a lot that has to get done in order for a deal to close. Because there are already so many potential roadblocks in place, it’s important for a company to provide as much support as possible to their salespeople.
By providing all the support that’s needed, companies can ensure that they’re not causing any inefficiencies that make things even more challenging for their salespeople. While salespeople will still have to contend with challenges like making it clear why a specific offering is superior to that of a competitor, not having internal hurdles to overcome can provide a significant boost.
To ensure that there aren’t walls between sales and management which are hindering the ability of the former to make deals, let’s take a look at three ways workflow automation can be successfully used:
Provide Smart Deals
One of the reasons that it’s typical for B2B sales to take longer is because price is something that’s almost always negotiable. From more complex packages to higher volumes, buyers want to be sure that they’re getting the best deal for their money. Since a lot of back and forth is already going to accompany this process, companies don’t want to create even more of it for their salespeople.
Instead, eliminating the need for drawn out internal discussions can give salespeople the flexibility to push for a sale and successfully close. With an automated approval workflow, salespeople can have the confidence to strategically discount without worrying about offering something that is going to make their manager unhappy.
Process Special Requests
Price isn’t the only element of B2B negotiations that often requires approval. There are a wide range of things that may come up which will require a salesperson to seek approval from their manager. If you want to ensure that getting special requests approved doesn’t stand in the way of a deal, an automated workflow is essential.
Dynamic Management of Inventory
One big consideration for B2B buyers is how quickly a solution can be delivered. If two offerings share many of the same features but one provider is able to deliver significantly faster than the other, the buyer is probably going to err on the side of speed. Utilizing automation in regards to inventory can help a business be as aggressive as possible with their delivery timelines.
It’s worth noting that the type of automation discussed above can benefit a business in other ways as well. For example, purchasing managers can use purchasing software to streamline their purchasing process and increase the overall efficiency of everything related to procurement.
The last thing any purchasing manager wants is for procurement disasters to blow up to the point where it’s costing the company resources and time. Although small errors and miscommunication are part of doing business, you still want to prevent major misfires that have a significant negative impact.
Even though it can be stressful to think about everything that can go wrong with tasks like vendor negotiations, thinking through this process can be a very useful exercise. By taking the time to carefully think through the purchasing process, it becomes possible to identify areas where things can go wrong. Identifying potential pitfalls in advance makes it much easier to figure out the best way to deal with them.
So in the spirt of preventing problems that can lead to major purchasing issues, let’s take a look at four ways you can proactively prevent a very bad situation:
Always Get Everything in Writing
When you’re on the phone with a vendor and you have a dozen other things on your to-do list that need to get done by the end of the day, it’s easy to speed through the conversation and assume that everything is in order. However, unless you have the exact order you discussed in writing, there’s always the possibility of something going wrong. That’s why you can save yourself a lot of headaches by getting details in writing. Even if you’re quite busy at the time, taking this action will save you from complications down the line.
Have a Policy in Place for Disputes
In a perfect world, purchasing managers would be able to go about their job without ever worrying about disputes. But because we’re in the real world, it’s important to understand that disputes may arise. The best way to minimize the negative impact of a dispute is to have a clear policy in place for resolving it. You want to know ahead of time what actions should be taken. This possible complication also shows the importance of keeping detailed records.
Prevent Things from Being Done Twice
In terms of wasting time and resources, duplicated procurement efforts are definitely a problem. One of the best ways to avoid this issue is to centralize all procurement efforts. A proven way to make that happen is by taking advantage of purchasing software. Implementing purchasing software will make it much easier for you to stay on top of purchasing activity and prevent issues like duplication from arising.
Whether it’s done deliberately or accidentally, buying items that aren’t needed may not seem like that big of a deal. However, this is an issue that can snowball and become a very real problem. To prevent that from happening, purchasing managers can enforce budget thresholds via our purchasing software.
The simple answer to the question posed by the title of this post is very important. The more detailed answer is it’s one of four main areas of a business that can help drive growth. To fully understand the role that procurement can play in growth, we’re going to start by looking at the other three areas, and then dive into exactly what can be done within procurement to help a business grow.
Because operations generally make up a significant portion of a business, there are lots of areas for improvement. It’s common for various gaps and inefficiencies to come up as a business expands. By first identifying those shortcomings and then finding ways to eliminate them, the operations of a business can be streamlined in a way that will put it in the right position to grow.
Create a Sales System
When a business is just getting off the ground, it’s standard for the sales team to rely on best practices. While taking that approach can secure some early wins, really nailing down sales is often a process of trial and error. The need for trying different things is why many businesses keep a fairly loose sales process. Although that can work for awhile, it eventually leads to a bottleneck.
In order to move past that bottleneck, it’s important for businesses to take what they’ve learned about effective sales and put an actual system in place. Taking the time to put this kind of system in place will not only benefit the existing sales team, but it will also support growth by making it easy to bring on new sales talent in the most efficient way possible.
Focus and Scale Marketing
In most cases, marketing follows a similar path to sales. After a period of figuring out what works, marketing is usually able to hit its stride. But in order to really drive growth, marketing needs to take its efforts to the next level by mapping out what’s going to be done over the next year. By thinking in terms of quarters instead of weekly or monthly campaigns, marketing can reach the point where it’s able to drive significant growth.
Simplify and Empower Purchasing
Now that we’ve covered the other three areas of a business that can drive growth, we want to take a look at how procurement can do so as well. When done in the most efficient way possible, procurement can help a business maintain an optimal budget. To make this happen, purchasing managers need the right tools. By taking advantage of cloud purchasing software, purchasing managers can ensure that everything from streamlining purchasing process to enforcing budget thresholds is within their control.
Although cloud computing is a relatively new technology, it’s already had a major impact in a short amount of time. And based on market research and trends that impact will only continue to increase. Data shows that by 2020, over half of all IT infrastructure will be in the cloud.
Why has cloud computing taken off in such a big way? While there are multiple answers to that question, they all link back to the fact that the cloud provides a lot of value to businesses that use it. From securely sharing information to having access whenever it’s needed, the cloud provides what businesses need to be as efficient as possible.
Another big driver of the cloud’s success is the fact that it can be used across a wide range of business functions. One compelling example is how the cloud is impacting purchasing. To fully understand this impact, it’s helpful to take a look at the specific ways the cloud is reshaping procurement.
The Cloud Brings Simplicity
Although the underlying details of cloud computing are quite complex, the experience for users is simplified in the best way possible. Instead of getting stuck with software that’s out of date or never seems to work right, cloud purchasing software provides the functionality that purchasing managers and organizations need. Not only is this type of software comprehensive in what it does, but it’s also very easy to use.
An Easy Transition
In the past, companies that wanted to take advantage of new technology had to put together a detailed roadmap for exactly what IT needed to get done. And even with the best laid plans, there was always a chance of something going wrong with the transition. What’s truly amazing about cloud software is this type of process is no longer needed. In fact, purchasing managers can easily get started with cloud software and continue using it without the need for IT.
Take Full Advantage of Everything the Cloud Has to Offer
If you want to reap all the benefits that the cloud can provide for procurement, our purchase order software is the ideal solution. At Bellwether, we designed every component of our purchasing software with purchasing managers in mind. That means it’s able to help with everything from automating purchasing processes to putting an end to maverick spending.
Not only is our software designed to save money by increasing efficiency and taking control of spending, but it takes full advantage of the power of the cloud. As fully web-based software, approved users can access the system from anywhere. In addition to convenience, our software provides full peace of mind knowing that all company information is kept safe and securely backed up. Give us a try with our FREE 30 Day Trial, or contact us to schedule a Live Demo and see how our purchasing software can work for your company.
Businesses rely on software more than ever before. The reason that modern businesses are so heavily invested in using software is because it can provide levels of productivity that wouldn’t otherwise be possible. While organizations use a mix of general software, there are also plenty of pieces of software that are made for specific departments.
Sales, operations and finance are all areas of a business that commonly use specialized software. In fact, these departments have been utilizing various forms of software for quite some time. Although there’s a lot of value in matching sales, operations and finance with the right software solutions, it’s important to understand that they’re not the only areas of a business that can benefit from specialized software.
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