E-Sourcing Platform for SMBs: Benefits and Transparency

Today, one of the main goals of companies in terms of sourcing automation is to increase the transparency of sourcing processes. This article explains the importance of automating sourcing activities and why transparency is something that SMBs need to strive for.

What is "transparency" in relation to sourcing activities?

With transparent sourcing, the data is “just a few clicks” away, so if the controller discovers during a review that purchasing costs have increased, it would be clear which item groups have increased in price or how many purchases have exceeded the planned volume. The purchasing manager can easily see what criteria buyers are using to evaluate suppliers.

Sourcing transparency can be achieved through a combination of approaches:

  • It is possible to develop a set of rules and regulations for the purchasing department, including the algorithms of conducting procurement and sourcing activities, supplier evaluation, the list of actions to be taken in case of contract violations, etc. 
  • Reporting can always be requested at the level of buyers and at the level of the purchasing department. Such an approach will allow managers to consolidate information about purchases, expenses, interaction with suppliers, number of contract violations, etc. 
  • Conduct the review of a randomly selected sourcing event: examine the documentation, gather feedback from buyers and suppliers, clarify the final costs and compare them with the procurement plans and initial budgets.

In theory, these approaches should work. In practice, they do:

It is impossible to achieve transparency in sourcing without implementing a right solution

The human factor is an obstacle to the development and transparency of sourcing processes. People forget, don’t want to do something, or simply don’t have the time. Automating all or part of the sourcing processes means minimizing the influence of the human factor.

 

How is it possible to achieve transparency by implementing an E-Sourcing platform?

A convenient E-Sourcing platform allows managers to increase the transparency of each stage of the purchasing process:

Planning and Budgeting – you can create procurement plans and budgets, monitor and adjust expenses, and analyze spendings.

Executing planning and budgeting in E-Sourcing platform

E-Sourcing – allows managers to conduct various forms of sourcing events using pre-defined algorithms and evaluation criteria set by buyers. Data on purchases and results of sourcing events are recorded.

Contract Management – monitor the execution of the contracts and record the violations to identify unsustainable suppliers. Ensure compliance.

contract execution through e-sourcing platform

Supplier Management – onboard suppliers with a few clicks, and document all interactions with them in one system. Create your own supplier database, filter suppliers, and keep only sustainable ones.

Managing suppliers in E-Sourcing platform

Digitizing procurement is not limited to managing purchases. It also includes analysis of past spend and reporting that the CPO, CFO, COO or other managers can review with just a few clicks. In Acquirell, for example, there are more than a dozen reports that are automatically generated for the convenience of managers.

procurement analytics: reports on purchasing activities

Implement Acquirell to your business processes and enjoy utilizing a reliable E-Sourcing Platform!

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