In layman's language, procurement is the management of purchasing and everything involved with acquiring third-party goods and services. It deals with the brokering of trade agreements. It looks for ways to attain products at the lowest price. It makes sure purchased goods are delivered safely to the premises. It counts the cash. Procurement is an important aspect of a business as without a dedicated department for acquiring goods, operations would stall. Hence failing to secure goods, would lead to making last moment arrangements and it invites errors, losses, and delays. To minimize the risks associated, the digitalization of procurement comes into the picture.
The digitalization of procurement is ripe for growth. Embracing new technologies creates a supplier network, optimizes the framework, helps in minimizing the associated risks, and offers more transparency to improve the efficiency and effectiveness in terms of saving time and costs. Adoption of 'e-Procurement' systems not only helps business but also helps the management in strategy building and, delivering improved and meaningful insights.
e-Procurement platforms certainly help businesses and make management's life easier and happier. It's safe to say that the digitalization of procurement eliminates pen and paper, and instead replaces it with a customizable platform with real-time alerts. The various repetitive and tedious processes also get taken care of with the help of automation which ultimately results in saving time. The cost involved in digital transformation is surely a bit hefty initially, but in the long run, it outweighs the initial investment significantly. e-Procurement systems can be bundled with many features such as contract management, Procure-to-Pay, supplier management, spend analysis, and financial savings management which can all help to gain meaningful insights and improves decision making. Not only that, but forecasting tools can provide a roadmap for fluctuating demand and layout possible paths to take for the highest profit margins. It streamlines the framework with a flexible and customizable platform that aims for accuracy and error prevention. Accelerated delivery is the main benefit that should be sought by streamlining the procurement processes. e-Procurement minimizes the manual steps that need to be taken to get a requisition underway. Not only does this reduce administration costs, but the requisition is quickly converted into an actual purchase order and is in the supplier's system.
As organizations adopt and learn how to identify and qualify suppliers, request bids, handle tenders, manage orders, and process e-Invoices, the opportunities are in abundance. Especially, e-Procurement includes a variety of sub-processes, such as; e-Informing, e-Tendering, contract negotiation, e-Auctioning, vendor management, catalog management, purchase order management, order status tracking, shipping notice creation, e-Invoicing, and e-Payment. Each standalone process offers plenty of room for innovation and development. There is enormous scope for fintech concerning to e-Procurement. The various leading and upcoming technological advancements such as cloud-based services, artificial intelligence, big data, and blockchain ledgers if when integrated with the systems will further boost up the demand for e-Procurement as it will lead to both time and additional cost savings.
e-Procurement is at the heart of maximizing the future success of B2B E-Commerce. As the adoption rate keeps on increasing, it won't be long when we realize the true potential of e-Procurement in today's business world.