Today procurement teams receive hundreds of requirements on a daily basis from departments all over their organizations. With decision-makers aiming to curtail unnecessary spending and improve savings, procurement teams are supposed to be more cautious and efficient while processing requirements. Every time, these teams are expected to optimize/(fulfill) each of the requirements, irrespective of the monetary value attached to it, at the right price and with the right supplier.
Let us dig deeper to understand these challenges faced by procurement teams at each stage of the requirement processing workflow.
Challenges Faced by Procurement Teams
Ascertaining requirements
Procurement teams receive requirements in multiple formats on various channels such as Email, ERP, PDF, WhatsApp, Slack, Microsoft Teams, etc. The finer details of the requirement are rarely captured. The email usually says, “I need a Dell Laptop”. Now there are at least 20 different models for a Dell laptop. Many of the requirements are communicated at the last minute. Other departments convey that all of the requirements need to be fulfilled urgently and were required yesterday itself. Now procurement teams have to send out enquires, follow up with the suppliers, coordinate for the clarifications and finalise the specifications.
Keeping focus on reducing TCO
Procurement teams have to calculate the Total cost of Ownership (TCO) for every single purchase. In the era of Strategic Sourcing, the aim is to reduce TCO. Thus, procurement teams have to evaluate Price, Quality, Service Levels, Compliance, etc.
Routing requirements successfully through approval workflows
Procurement teams have to secure approvals for the requirements from different stakeholders before they are finally released to the vendor. Many organizations, follow the hybrid model to run approval mechanism. Few tasks are performed automatically while other tasks require manual intervention. Such hybrid models or complete reliance on manual efforts for approvals decrease speed and efficiency. Subsequently, procurement teams follow up for the deliveries. All above challenges lead us to a critical question.
Is it possible to correctly ascertain requirements at line item level and processing them optimally every time?
No. And thus Doing it right every single time seems next to impossible right? a recent Gartner survey states that 70% of the business functions are not happy dealing with the procurement teams. They would rather do it themselves. But we all know that it is huge cost to the organisation. Unoptimised costs, loss of compliance, increase of maverick spend and the list continues to extend.
Let’s talk about an ideal solution that would enable business to overcome the challenges in the requirement processing.
- A virtual assistant guides the users to the right goods and services in real time, finalising the exact requirements/(and allows them to finalize the requirements/finalizes requirements on their behalf.)
- This virtual assistant will be available on all they existing channels – email, slack, teams, whatsapp. This will ensure zero resistance and change management.
- Built on an intelligent algorithm that analyses the historical buying behaviour of the organisation, and processes those requirements automatically to the right suppliers on the right channels.
- Sends out enquiries and ensures it receives all the quotation on time on a platform of their (vendors’) choice.
- Technical clarifications between all parties are conducted the way the procurement professionals discuss on a slack channel / or a whatsapp group.
- Consolidates all sporadic requirements and sends them to preferred vendors, under smart contracts.
- Finally, a system which keeps learning from all the user interactions every single day with every single transactions – with zero resistance & down time. Systems need not sleep right?
Now what could be the benefit of having such a system?
We’re enabling a controlled self-service system ensuring that both the end-users’ and the organisations’ needs/expectations are met. “All Hail Procurement!”
Procurement teams can focus on their core strategic activities like Vendor Management, Quarterly Purchase Planning, Category Management, Supply Risk Management, Sustainability, etc..
Organisations will never have to worry about their employees moving between teams, categories & even companies. Intelligence is always retained. We don’t have to worry about hiring fresh talent, who needs to be guided at every step of the journey.
Last but not the least, we all could could look at saving those precious dollars, which are the direct KPIs that impacting our bottom-lines.
Now what if we tell you that we have already built this ideal solution. One that has soled every one of the problems mentioned above. That’s what we call Aerchain’s autonomous PR – PO process.
To learn more about Aerchain’s solution, write to us at sales@aerchain.io
