In view of the pandemic, the business and supply chains that contribute to business development have been really hard hit, first of all. But, as they usually say, even in such difficult times, there is nothing bad without something good. Thanks to the fact that we are now aware of flexibility, stability and reliability, we can successfully apply this information to the planned source-to-pay (S2P) procedure and assist enterprises successfully and quickly solve any new, constantly emerging problems and difficulties.
Interactive seminar on the employing of playgrounds S2P as a tool for stabilization of supply-chain, specialists in the sphere of purchases from such organizations as Forrester, Ivalua and other leaders in procurement have been able to talk on the following topics: assistance from numeric conversion, the consuming of technology in various types of activities, the capability to minimize hazard and increase stability, reliability in organizations. As a result, they are ready to withstand the crisis and other sudden situations, new conditions like Covid-19, and also against other possible, sudden problems: customer requirement for permanent and correctly produced stuff or products produced using certain technologies, a tense situation in the political sphere, trading wars, monopolization, extreme changes in the weather, natural disasters, catastrophes.
According to the leader of the analytical department of Forrester and part-time vice-president of the company Duncan Jones, the desire to avoid risk, although commendable, but quite naive in nature and essence. It is never impracticable to completely avoid the risk, but it is possible to minimize the risks and prepare for their manifestation.
As you know, the activity of experts in the field of supplier selection and approval is to analyze and understand the risks in the supply chain and manage them in order to minimize the risks and possibly eliminate some of the initially expected consequences of the problems that arise. In order for this process to take place safely, it is necessary to gain access to the required information, and, moreover, to the technologies and tools based on which the above-mentioned activities will take place. Among other things, special attention is needed to control the relationships between suppliers. In addition, you should strive to be the best customer in the eyes of your suppliers.
- The consistency of new priorities determines and increases the value and significance of purchases
- Introduction of the right toolkit for implementing activities as a key
- Speed brakes, Meritor and the digitalization of the workflow in conjunction with the Ivalua
- Develop and enhance provider relationships for the sake of stability and reliability
The consistency of new priorities determines and increases the value and significance of purchases
It has long been the case that purchases were considered a kind of added value if they could successfully coordinate expenses. However, unfortunately, reducing expenses is not enough. Foster Research conducted a study according to which the credentials to decrease expenses does not have the right to modify or cause basic, fundamental priorities to fluctuate. Such presidencies include increasing the quality of stuff and amenities, perfecting the customer experience and responding more quickly to all kinds of innovations in the market and in business.
In addition to the above, Jones spoke about how companies with an increased level of efficiency are able to combine a creative approach in making products and providing customer service with special reliability, stability and the ability to adapt to constantly changing realities. Stability and the ability to respond to possible changes affect the procurement process, making it more strategically correct than if the procurement process was focused solely on the factor of reducing the required costs. The implementation of this, the above-mentioned scheme involves the collection and analysis of information, which is automatically performed at each of the available stages of procurement. Among these stages, it is possible to distinguish the implementation of control over the life cycle of the contract, the issuance and formation of invoices, the search for suppliers before the start of the procurement process. Among other things, this also includes finding out useful and important data that will serve as the basis for making a choice between suppliers, products, affect the control of the required costs and so on.
However, within the framework of modern realities, companies engaged in procurement suffer from unsuccessful actions, absolutely inefficient communication with interested parties of providers, information repositories.
According to Doug Keely, Ivalua’s chief item marketing head, the manual format of the labor process imposes some restrictions on the capability to expand production and success. To some extent, this depends on such factors as the absence of interaction within the business, including with suppliers and partners, which, in turn, negatively affects the possible revenue, as well as the degree of user satisfaction.
According to Keely, information storage slows down the efficiency of the workflow. With the gradual addition of new technologies and process execution toolkit to address the above difficulties, the structure becomes truly difficult when creating information repositories that restrict stakeholders’ permission to the requested information for assessing opportunities. The capability to obtain such information is truly essential in cases of supply system disintegration, which today, for example, often occur due to a worldwide pandemic.
Introduction of the right toolkit for implementing activities as a key
From all of the above, the following question arises: how can companies achieve efficiency, stability and the capability to adapt to the ever-changing realities of life and work in particular? You should proceed by identifying the appropriate decisions and choosing techniques to change the digital aspect of the issue, for instance, solutions that contribute to the centralization of the information received in the S2P life circuit. When choosing a playground for digitizing actions and improving the vendor management process, you need to find modern software that uses information from various sources to help you make the right decisions.
Automation of the workflow is also a fundamental opportunity. With the right technology, companies are able to automate recurring manual actions and give employees the opportunity to focus on the activities that provide profit, instead of such small things as agreement negotiating, provide leadership, billing and other manual procedures.
The structured S2P playground supports prioritizing actions correctly, transforming everyday work and actions into more effective ones. It can also use AI to improve your decision-making capability, apply the required internal and external data and provide advice and guidelines that will significantly improve your company and minimize the necessary costs.
For example, the professional S2P platform like Precoro.com generates recommendations of specific providers for selected stuff, relying on previous requisitions, information about the good or cooperation, which excludes the period expended searching for providers. Automated requirement alarms can be made at the factory that manufactures the products. This process is important in warrant to move recurring decree or notify employees about deliveries that are out of the work schedule.
This principle of working with an increased level of automation represents the prospect of acquisition and will allow companies to remain stable, resistant also in situations of fracture. Also, among other things, he told us that the local ERP device will soon become something of the elapsed time and will be substituted by excellent procurement platforms in electronic format, which will be able to interact using such toolkits and technologies as CRM and systems for the implementation of management activities for services.
In addition to all of the above, Jones added that companies will have to change their attitude towards suppliers. After all, as you know, today there are a huge number of competitors who can ensure the same amenities as your own organization. It is for this reason that in modern realities it has become important to consider providers as affiliates, not customers.
Speed brakes, Meritor and the digitalization of the workflow in conjunction with the Ivalua
There are two companies that have long been reliable, stable, able to adapt to modern, changing realities. One of them is called Chassis Brakes, which is an international manufacturer of car brakes and other required elements. The second is called Meritor and is an organization for the production of military automotive elements. As clients of Ivalua, the above-mentioned companies have digitized all kinds of obtaining procedures, provision chains in order to reduce risks and minimize costs, improve correlations with providers and avoid performing repetitive tasks manually.
For the first time, Chassis Brakes implemented a new concept of acquisition in electronic format only four years ago. This was done so that information about suppliers, verification of the success of the providers’ workflow, as well as digitization of permanent and consequential cost processes would take place directly from the center.
By achieving the above goals, it is possible not only to decrease the cost of controlling the chassis brakes, but also to increase the level of stuff. After Ivalua was used by purchasing specialists at Chassis Brakes, consequential costs were decreased by 10%, but contract visibility was 100%, and acquisition requests were covered by 99 percent.
Meritor also started making numeric modifications a couple of years ago. This process started with the consolidation of twelve different systems in various departments. Separation of resolutions and procedures, which were mostly handheld, leads to interaction with providers with some interruptions, which, in turn, weakens cooperation and cooperation, worsens interrelationships with providers.
After the organization created Ivalua, it was going to introduce 20 more new stuff to the world in order to increase profits by 20 percent, but at the same time, the organization wanted to decrease the price of production by 2.5 %. With the digital alteration made to Meritor’s operating mechanism, the organization accomplished its objectives, and in addition brought almost $2 billion in direct costs under supervisory control, reduced manual problems, and presented the introduction of new products as an advantage in the role of a competitor.
The above instances demonstrate the effectiveness of the vocational S2P platform, which provides assistance to procurement specialists to improve the efficiency of companies, and provides the correct technology toolkits to instantly satisfy all kinds of business needs.
Develop and enhance provider relationships for the sake of stability and reliability
Thanks to the overall pandemic, the significance of such characteristics as business stability and sustainability has come to light, so this is a kind of plus: enterprises engaged in procurement can make an impressive contribution to this area.
The resulting questions with any of the providers can have a significant impact on the acquisition process along the input system. Companies that are able to track all the stages and processes of procurement are able to minimize hazard and make some modifications to the workflow to maintain their case in a successful manner. This process starts with the correct information and the capability to disassemble it to obtain practical conclusions.
However, it is worth understanding that it is not only about the success or automation of the workflow, but also about the capability to find the best methods of cooperation with providers. Properly executed, structured, digital transformation promotes more potent interrelationships with providers, which creates the necessary, required basis for prospect novation.