What Are the Benefits of Automating Procurement Processes?
In every company, the procurement process involves a lot of personnel and paperwork. Automating procurement processes is a great way to minimize time, effort, and costs. Some of the major benefits of automating procurement processes are:
- It overcomes all the hassles and chaos associated with piles of paperwork. Searching for information is quick and easy. Furthermore, all the important information is stored safely in a hard-to-breach location.
- Human errors in procurement are far too common. Misplaced orders can degrade the efficiency as well as the reputation of the company. With procurement automation, all purchases occur exactly as they should, within the limits of the budget.
- It enables real-time updates and tracking of purchase status and available budget. However, for humans, this process might be time-consuming.
- There is increased productivity in the workplace because most of the manual works are carried out by the software. This allows the department to focus more on brainstorming and devising strategies.
- For companies, it can save labour costs by cutting down the number of employees required in the procurement department.
5 Procurement Processes That Can Be Automated
Although companies have a well established, formal purchase order systems, nearly half of them experience shortcomings. Purchase orders, although a relatively easy task, involve multiple personnel. Automating this process can save time and costs and boost productivity in the workplace.
Every purchase order must go through a series of approval before execution. Purchases exceeding the budget limits may require additional approvals. In absence of the necessary approver, this process can be halted for a significant amount of time. Furthermore, a pause in this process might limit other important processes from being executed. With automation, the process can be approved instantly because the necessary terms and conditions would already have been designed inside the software.
Vendors and Suppliers Management
As a company, you need to buy things frequently. Thus, it is absolutely necessary that you have smooth, long-lasting relationships with your vendors and suppliers. With procurement automation, you can maintain clear communication and inspect every offered quote in real-time. Likewise, you can resolve your differences and work on a solution that is a win-win for both parties. Furthermore, you can work with multiple vendors at the same time.
During purchases, it is certain that you and your supplier are bound to some terms and conditions. If you have multiple vendors, there must be multiple contracts where the terms are stated. Therefore, quick access to this information is extremely important. Furthermore, there must not be any breaches and changes without the consent of both parties. With procurement automation software, your contracts are securely stored in a database and hence they can be accessed quickly.
Invoice Management and Bookkeeping
Invoice management is a critical part of the procurement process. Any mistakes in this process can cause imbalances in your accounts. Likewise, you must transfer them to multiple people for approvals and requests. With manual procurement, there is a high chance of misfiled records and accounting errors. Similarly, checking for errors is equally time-consuming. Furthermore, there is a little check of reckless spending and compliance with the budget limits. In contrast, an automated procurement process enables quick and easy invoice approval and record with strict checks in spending.
How We Can Help?
From this blog, we have learned the five procurement processes that you can automate to boost productivity and save costs.
3E Accounting can help you set up an automated procurement infrastructure with guaranteed reliability. Our digital advisory experts have unmatched experience in this field and hence can recommend the best solution depending on your business and budget needs.
Manual procurement can limit your growth and keep you in the rear end of the competition. Make that much-needed transformation today with 3E Accounting.
All the details of our high quality digital advisory services are available.
Contact us at +65 66909262 or email at email@example.com for more information.