4 ways cloud-based procurement processes help SMBs to compete

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CloudBasedSupport.jpegBy Angela Wilson, Senior Solutions Architect, CSS

While large companies with procurement departments often have the personnel and resources to negotiate significant savings and better terms, small and medium businesses (SMBs) typically do not. The good news is that the digital era has created new opportunities for SMBs to improve their procurement practices and outcomes, especially with cloud-based processes.

There are very different business requirements when it comes to how SMBs source goods and services: "Using modern cloud procurement solutions is the best way today to meet these requirements", says Angela Wilson, Senior Solutions Architect at CSS, a systems integrator that helps companies create supplier management and logistics programmes. With the right tools, companies can realise a number of advantages.

Oracle's e-book, A Guide to Developing a Responsive, Cloud-Based Procurement Process, highlights some of the critical benefits of cloud procurement processes.

Sourcing
Finding the right provider for the job as well as getting the best price can mean time-consuming research. Strategic cloud sourcing can save time and money. By having all of the information about past engagements and pricing in an easy-to-access format, your team can speed up awards and thus get projects moving faster.

In some cases, suppliers need additional vetting, such as for highly-regulated industries or to ensure proper credentials for a job. Cloud-based qualification management systems can deliver a list of appropriate suppliers in far less time than other systems. Such systems can alert you to potential issues and key deadlines, helping to ensure that the right supplier is chosen for the job.

In addition, building an effective supplier portal into your system shifts onboarding responsibilities to the supplier, which can eliminate bottlenecks and free up your time for more valuable work. Such portals often become much-needed, automated transaction centres that allow the transmission of documents, estimates, contracts and other communication directly through the portal.

Contract management
But the work is not over once a supplier has been located. Contract review can cause delays and add on additional costs. By using cloud-based tools to streamline contract management, standardise contract creation, create a language clause library and adopt other useful practices, you can cut time and expense out of your contract management process.

So, why is automating and streamlining supplier contract management important? Procurement delays equate to missed deadlines, rush fees and, in the worst-case scenario, an inability to complete critical tasks or fulfil order components. Inefficient approaches can be costly and damage supplier relations through delays and misunderstandings. Having a streamlined, cloud-based system goes a long way toward solving these challenges. Often companies that rely on these systems develop stronger, more collaborative relationships with vendors because the emphasis shifts from transactional to true partnerships.

Strategic spend
One misconception about cloud-based systems is that they are too complex or expensive for SMBs. CSS, using solutions like Oracle Procurement Cloud, can create nimble systems that are built as needed. Your mid-size company can start with a solution that targets your most immediate procurement issues, then add modules to address others as the company needs them.

As a cloud-based procurement process becomes a part of your company's operations, one of the key benefits is the power of data. Analytics will allow your team to spot spending patterns, budget overages, savings opportunities and other important, big-picture spending factors. These insights and others will support you when you develop more strategic approaches to spending.

Employee engagement
Employees also benefit from procurement cloud systems. Self-service procurement allows your procurement team (or person) to access what is needed, when it is needed, without going through lengthy approval processes for every purchase. Of course, you set the parameters but if a team member needs, for example, a new chair or printer, they can order it directly without delay. As more employees work from mobile devices, ensuring mobile enablement for purchases and approvals is important. Such autonomy has been shown to improve employee engagement.

Clearly, the benefits of cloud-based procurement systems can be significant for SMBs. Wilson explains more in an interview about how CSS helps companies to adopt effective cloud-based procurement systems.

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