Why Your Business Needs Procurement Process Automation

If your company is currently automating several processes, you might need to convince the key stakeholders that procurement should rank highly on the list. That key stakeholder could even be you. Consider these benefits and estimate their value to your business. From there, making a decision on procurement automation becomes much easier.

1. Productivity

Some managers still believe busy employees are productive employees. Modern-day managers understand that being busy has nothing to do with productivity, especially when wasting human intellect on menial tasks bots can handle. Automation reallocates that human intellect so people can be doing things bots cannot.

2. Agility

The past two years have taught companies the importance of agility. When companies leverage technology for automation and cloud computing, they have a much better chance of adapting quickly to any changes that occur. It is also easier to reduce or ramp up procurement as needed to meet changes.

3. Availability

Bots work right around the clock. They don’t need lunch breaks and don’t take vacations. This makes it possible to reduce disruptions at work. Bots can follow simple rules to determine whether to approve a procurement request. For example, they might look at the budget and cash in hand and accept a $200 request for office cleaning supplies.

4. Job Satisfaction

Employees want jobs that are challenging for all the right reasons. Combing through piles of paperwork is generally not one of those “right reasons.” Automating and digitizing steps gets rid of the tasks employees tend to dislike most of all. This creates an environment for creativity to thrive.

5. Speed

Bots complete menial tasks much more quickly than humans do. What could take thousands of human labor hours to complete a bot could do in a mere second. The less time people spend on procurement and the less overall time it requires, the faster the business can get the materials, products and services it needs.

6. Documentation

Some companies or managers have stubbornly held on to paper processes. Printing and hand-delivering these take time. They also increase the risk of documentation getting lost or even stolen. Automation and digitization virtually eliminate this risk. You can even track who made changes to the procurement cycle documents.

7. Accuracy

People make mistakes. No matter how brilliant and thorough they are, mistakes can still happen. Bots handle repetitive tasks with much lower risks of inaccuracy. As long as the information bots receive is accurate, the rest of the work they complete follows the same vein.

8. Safety

In some fields, workers rely on the procurement team to get the safety gear they need. Construction workers, for example, need helmets and harnesses. When workers don’t have the safety gear they need, they might feel pressured to work anyway. This could create a safety nightmare.

It might seem like a good idea to automate the entire business as soon as possible. Why not start reaping the benefits of automation sooner rather than later? A learning curve could slow progress and too many changes could create a compatibility nightmare for workflow. Consider changing a few things at a time. Start with these four procurement processes.

1. Purchase Requisition

Workers use this to request approval for a purchase, such as paper or ink for the printer. Automation could significantly reduce wait time for these smaller but crucial items. It accomplishes this by automating some of the approval stages to reduce overall time.

2. Purchase Order Processing

This is a simple and repetitive task that bots could handle with ease. Automating this takes the unnecessary manual step out of confirming a purchase order. It can significantly reduce wait times.

3. Invoice Approvals

Approvals tend to be that big step that also involves long wait times. The invoice tends to land on the desk of top managers and the less urgent it is, the higher the likelihood of the manager continually putting it off. Eventually, it could be forgotten altogether.

4. Record-Keeping

All contracts and documents related to transactions should be retained for as long as possible. These documents help protect the business in the case of a dispute, especially if it goes to court. In some fields, record-keeping is mandatory for compliance reasons.

5. Data Reporting

All parts of the business require data reporting, so managers have an idea of where the business stands. Reputable tech solutions make it easy to gauge performance via a centralized dashboard. It also makes it easy to generate and submit reports.

Virtually all the top companies in the world rely on automation for procurement. This even includes service-based organizations, such as the KPMG accounting firm. The company provides these tips for companies looking to transform their procurement processes:

1. Choose a tech solution that offers a cloud-based tech solution, so you can access it from anywhere.
2. Choose a tech solution that includes enhanced contract management.
3. Choose a platform with impressive analytics to better inform your procurement and purchase decisions.
4. Integrate your e-procurement efforts with your enterprise resource planning solutions.
5. Budget for training so employees understand exactly how the new system works and how it affects their jobs.

While not mentioned by KPMG, companies can rely on solutions that provide templates and tools to save the company time and money. These pre-existing templates can play a crucial role in quickly formalizing procurement processes and creating a branded experience.