E-procurement platforms are a must-have tool for every modern business invested in simplifying and improving their procurement processes. However, with so many options available, it is important to know what makes a good procurement software. Here, we look at eight crucial features every procurement tool must have.
1. Seamless integration
A top procurement software solution should seamlessly integrate with other business tools such as your accounting, enterprise resource planning, and inventory systems. This will help eliminate redundant processes, human errors, and unwanted data silos for streamlined coordination amongst your departments. You will also benefit from the real-time insights given the availability of quality data from different teams, allowing for faster decision-making.
A procurement tool should eliminate redundant or tedious tasks for efficient workflow. As such, the software solution you choose should have time-saving automation features to reduce the burden on your procurement team and improve the accuracy of your procurement processes. Popular automated procurement software features to prioritize include approval workflow, auto-billing, three-way matching, and single point of data capture/entry.
3. Budget management
A core function of every procurement department is tracking and managing the available budget while ensuring it has maximum impact on the company’s bottom line. An ideal procurement tool should augment this by providing outstanding budget visibility.
These real-time oversights of the available funds against all expenditures and projects will enable you to attain better budget control by making more proactive decisions. You will also be able to make timely comparisons with previous periods to avoid budget overruns while taking note of spikes and lows in your expenditure.
We are in the age of cloud computing, and as a future-ready organization, you can no longer afford to be tied down by locally installed procurement software. The modern workplace is virtual, and for better workflow, you need cloud-based procurement software that can be accessed anywhere at any time.
Cloud-based procurement tools are also easier to set up and deploy, enabling you to realize faster time-to-value. Most importantly, cloud-based systems are safer than on-premise software as the data ‘in motion’ and ‘at rest’ is encrypted to limit unauthorized access.
5. Supplier management
You need a procurement platform that simplifies supplier onboarding and management for the benefits of:
- Regulated purchasing that is only done with approved suppliers
- Timely measurement and evaluation of supplier performance
- Better bargaining power as you can leverage the available supplier data to negotiate for better terms
- Easy coordination with suppliers as they can track the status of their orders, delivery schedules, purchase catalog, and payments
Timely and proper communication among all stakeholders is essential in the procurement process. As such, your procurement software solution should have excellent communication features such as real-time notifications and automated reminder alerts for smoother collaboration with all users.
Your procurement tool should also be transparent and give all stakeholders an overview of the processes they are engaged in for quicker actualization of all transactional goals. For the best results, all communication should be centralized, traceable, and backed with active user support.
7. Data analysis and reports
Attaining insights into your procurement processes and expenditure is the basis for understanding better how you spend your money and manage your operations. Therefore, a procurement tool remains incomplete unless it has data analysis and reporting features for actionable insights.
Your procurement software should be powerful enough to comprehensively analyze the available data and present them as ready-to-use reports in simple yet visually rich formats such as charts and pivot tables.
8. Auditability and risk management
Every effective procurement software must promote transparency and accountability by offering audit trails. This calls for an e-procurement platform where every transaction is traceable and well-detailed, containing date and time stamps that can be viewed at any time.
User activity and authority should also be well captured to quickly determine who requested, purchased, approved, or received any item. This will help eliminate rogue spending and ensure compliance with your expenditure policies for excellent internal controls of your procurement processes.
Since you also need to gain spending control, active risk management features that help quantify the budget impact and risk levels before any expenses are incurred are necessary. This way, you will have a proactive spending and asset management plan that eliminates unmanageable risks.
Before committing to any procurement tool, it is advisable to ensure it can satisfy your company’s critical needs and have the desired impact on your operations. The best way to achieve this is by having in mind these crucial features when looking for an e-procurement solution.