Modern times have sure shifted in the last several years. Not long ago everybody was still using wired phones that plugged into the walls and were lucky if they were able to check their email from anywhere else than on their own desktop computer. A skilled Ivalua consultant will understand that in order to continue to thrive in business, the business will have to move forward and stay aligned with the advancement of technology.
When it comes to the topic of procurement, it is an understatement to say that it can be complicated at times. Especially when the company deals with thousands, or even millions, of transactions every day. At what point is it necessary to get help from an app? Right now.
From Source to Payment
Many businesses are aware of the importance of the source-to-pay process. The entire procurement system in an organization should always include the critical sourcing step that creates the foundation for a successful business. One of the most important assets that a business can have is good, solid sources.
To find the perfect sources a business needs to:
- Locate vendors that have fair prices
- Find vendors that are reliable
- Find sources that are easy to work with
- Have backup sources in case one fails
In the old days, a company had to pull out the phone book and jump on the telephone to make calls wherever they needed to in order to negotiate terms with potential sources.
With the new technology that is available to businesses today, finding sources can be as easy as a few mouse clicks and a little bit of typing. Artificial intelligence can use the parameters that are set up in the query to find the perfect sources and compare them with each other.
In addition to finding great sources, the software can also be programmed to reach out to each potential source and set up negotiations for prices and contractual terms.
Spend Management Solutions
Some businesses have it all together when it comes to the way that they spend and invest money. Others are not so successful. The truth is that if a company spends more money than it brings in, it can not succeed. If the source of money that allows the company to spend is not enough to allow it to continue to spend the cycle will not last and the company will either fold or get into so much debt that it will never recover.
One of the key elements of the kind of technology that is available specifically for procurement is that it keeps track of spending habits and can automatically search for better ways to spend and better ways to invest.
Spend management consists of:
- Tracking spending
- Forecasting trends and investment opportunities
- Discovering and exposing money leaks
- Sending reminders and notifications to keep spending on track
Every business will have its own specific needs and goals. The software can be programmed and administered in a way that helps every business in its own unique elements.
Source Management Solutions
To take things a step further, many companies have multiple sources because they have multiple needs. For example, you wouldn’t expect a department store to carry gasoline. Nor would you expect a clothing store to sell meat.
With every source comes a unique relationship with specific needs and expectations. In many cases, a contract is written up and put into effect by both parties, the business, and the vendor.
Some of the agreements in a contract could be:
- Guaranteed pricing for items or services bought in a specified quantity
- Price cuts for services or goods bought within a specific timeframe
- Price reduction for receipt of payment within a specific timeframe
Most contracts will have an expiration date on them that nullifies the agreements unless the contract is renegotiated and put forth with new terms.
Where businesses can fall into trouble is that just because a source makes a deal for a price, does not mean that they will keep that price and follow the terms without being reminded.
In many cases, a company will make a deal with a vendor, but the vendor will fail to notify the rest of the company about the deal. What happens is that the purchase will go through, but the price cut will not be in effect. Sometimes the company is not aware that the vendor failed to deliver the price of the agreement, which leads to significant business loss…especially if the company could have bought the same product or service at a cheaper rate from another source.
Between contract agreement enforcement and expiration dates, there is a lot of information to keep track of and can sometimes be overlooked or forgotten.
With procurement software, the entire source management task can be taken care of automatically just by instructing the platform to keep track of contracts, vendors, and expiration dates.
Taking things even further the software can either send reminder messages to a human so that they can deal with whatever the issue is, or the software can take care of issues on its own by contacting the vendor, or stopping a transaction until the price issue is solved.
Artificial intelligence has become a lot more intelligent than many people may think. Many of the modern communication vessels such as chat or telephone systems can be handled by automated assistants that are programmed to answer questions and provide help for many issues that customers have with products and services.
In addition to communication, tasks such as management, order fulfillment, forecasting money trends, and much more can be performed by automated technology.
Imagine being able to automate your entire procurement process from source to pay? From the planning to the sourcing, through the ordering and maintaining of contracts, then to the final payment stages. Everything is done on time and without delay.
Although there does need to be enough human interaction for the software to be guided in the right direction, once the program is dialed in and understands the tasks, most of the procurement operations can be done without much help from humans.
The Demands of Technology
Although there are many business owners and regular people that do not agree with the direction technology is heading, the truth is that it is continuing to move forward and there is no way to stop it.
In order for a business to keep up with the constant changes that are happening around the world, they do not have many choices other than to invest in a platform that will allow them to conduct business on a regular basis and keep up with the changing times.
Many of the companies that work today have made it so that businesses can’t interact with them unless they have the technology to do so:
If the most powerful entities in the world are forcing the rest of the companies to turn digital in order to communicate with them, if companies fail to move forward, they will get left behind. How can a business run if it has no way to accept or pay money?
Companies that want to reach beyond what they are already capable of have no problem transforming the way that they do business to a digital format. What better way to do business than to be able to instantly connect with the rest of the world?
In any event, regardless of the opinions of those who do not want technology, the time to get on board the technological advancement train is now.