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procurement automation for smbs

Jun 01

Macro Finance and Procurement

By Procurement No Comments

Macro Financial Concerns and Procurement in 2023: Are You Ready? 

The year 2023 has presented itself as a period of financial restraint, as the International Monetary Fund (IMF) echoed. Global growth is forecasted to fall from 3.4 percent in 2022 to 2.8 percent in 2023, and a more pronounced slowdown in advanced economies demonstrates a tightening macro-financial landscape.  

Furthermore, the financial sector is experiencing turmoil due to high inflation and ongoing geopolitical tensions, increasing market instability. Despite central banks raising interest rates, underlying price pressures are still proving stubborn, suggesting a prolonged period of financial strain.

 

The Impact on Procurement 

These macro-financial changes are placing a new level of pressure on procurement departments. In this context, procurement’s role has evolved significantly.  

The Chartered Institute of Procurement and Supply (CIPS) outlined key procurement trends for 2023, emphasizing the need for sustainability, timely payment to suppliers, investment in technology, and talent management. 

Sustainability has become a primary concern, as customers are increasingly sensitive to ‘greenwashing’ and demand more transparency about the environmental impact of their purchases. This trend pushes organizations to ensure sustainable practices in their supply chains and avoid falling foul of regulations. 

The challenging financial environment has led to 36% of businesses extending payment terms for suppliers in the last 12 months. This contributes to a vicious cycle that impacts cash flow and liquidity, emphasizing the need for improved supplier relationships and strategic payment practices. 

Investment in procurement technology solutions is also growing. Companies are seeking more consumer-like, intuitively designed, and agile solutions to improve efficiencies and work with leaner staff. 

Finally, with the predicted economic environment, there’s a new urgency to fostering a company culture and strategic problem-solving to attract and retain talent​3​ 

 

Navigating Economic Uncertainty with SAP Ariba 

As predicted by the IMF, the global economic outlook for 2023 presents a complex landscape characterized by financial sector turmoil, high inflation, geopolitical uncertainties, and the lingering effects of the COVID-19 pandemic. In such an environment, businesses need robust, flexible, and intelligent tools to navigate the choppy waters of global commerce. 

With its comprehensive suite of solutions, SAP Ariba is perfectly positioned to help businesses adapt and thrive in these uncertain times. Its intelligent sourcing tool, for instance, allows companies to identify savings opportunities and assess market dynamics, giving them a competitive edge even in challenging conditions.  

As inflation remains high, the ability to efficiently source and manage direct and indirect goods or services within a single platform becomes a crucial advantage, allowing businesses to reduce their time, effort, and risk associated with sourcing events. 

 

Aligning with Sustainability Trends 

Sustainability is no longer a niche concern; it’s a core business priority. Businesses are increasingly under pressure to demonstrate that their operations and supply chains are sustainable to meet regulatory requirements and appeal to increasingly eco-conscious consumers. 

SAP Ariba’s Supplier Management tool can be a crucial asset. It provides comprehensive tools to help buyers onboard, qualify, segment, and manage supplier performance according to parameters that matter to them. This means businesses can drive spending towards preferred, sustainable suppliers, reduce overall risk, and ensure compliance across their entire supply base. In doing so, companies can turn sustainability from a challenge into an opportunity, bolstering their reputation and gaining a competitive advantage. 

 

Embracing Technology for Greater Efficiency 

SAP Ariba is at the forefront of the trend toward increased investment in procurement technology. Its suite of solutions embodies a consumer-like, intuitively designed, and agile approach that can significantly improve business efficiencies. For example, the SAP Ariba Supply Chain Collaboration tool automates the direct procurement lifecycle, reducing reliance on emails and spreadsheets, shortening cycle times, and increasing productivity. 

SAP Ariba Buying and Invoicing further streamlines the indirect goods and services procurement process. Automating and regulating the management of the entire procurement process helps business leaders eliminate errors and exceptions, manage more spending with less effort, maximize savings and profit margins, and respond flexibly and swiftly to changing demands. 

 

Winning the Talent War 

In the predicted economic environment, fostering a strong company culture and attracting the right talent will become even more essential. SAP Ariba’s user-friendly, intuitive design is crucial in this regard. It makes procurement tasks more engaging and less cumbersome, improving employee satisfaction and retention. 

Furthermore, the Guided Buying feature of SAP Ariba makes the procurement process more intuitive and compliant, making it easier for employees to adhere to procurement policies and procedures. This enhances the effectiveness of procurement teams, freeing them to focus on strategic problem-solving and relationship management, which are crucial skills in the modern, complex business environment. 

In conclusion, SAP Ariba is a powerful tool that can help businesses navigate the challenging economic conditions predicted for 2023, align their operations with key procurement trends, and drive significant efficiency and cost savings. By leveraging its comprehensive suite of solutions, businesses can position themselves to survive and thrive in the uncertain times ahead. 

 

In a time of financial restraint and uncertainty, organizations must leverage tools and strategies to help them navigate these challenges. Armed with solutions like SAP Ariba, procurement departments can play a pivotal role in driving cost savings and efficiencies. The time for organizations to act is now – to survive in the current financial climate and thrive in the years to come. 

 

May 16

Unleashing the Power of AP Automation: A Strategic Move Towards Efficiency and Profitability

By Procurement No Comments

In an era where digital transformation drives sustainable business growth, one area that remains ripe for disruption is Accounts Payable (AP). AP automation is no longer just an option – it’s a business necessity that yields considerable strategic advantages, particularly for mid-market companies. This post aims to provide an in-depth understanding of the myriad benefits of AP automation to executives committed to fostering operational excellence, reducing costs, and enhancing cash flow management.

 

The AP Challenge: A Time and Resource Intensive Process

AP processes often contain manual data entry, paper invoices, and lengthy approval cycles. These processes are time-consuming and prone to human error, resulting in late payments, missed discounts, and increased operational costs. The lack of real-time visibility into AP data often leads to suboptimal decision-making, hampering growth and profitability.

The AP Automation Advantage: Transforming the AP Landscape

AP automation technology disrupts this status quo, offering a more innovative, efficient, and cost-effective way to manage AP processes.

Let’s delve into the specific benefits:

  • Time Savings: AP automation drastically reduces the time to process an invoice, leading to faster approvals and payments. This increased efficiency frees up valuable staff time that can be better utilized for strategic tasks, such as analyzing spending data or improving supplier relationships.
  • Reduced Operational Costs: Automating AP processes reduces the need for manual intervention, thereby minimizing the scope for human errors and the costs associated with rectifying them. Moreover, it can also decrease storage and postage costs associated with paper invoices. Calculate your potential savings here using SAP’s Buying and Invoicing Value Calculator.
  • Enhanced Cash Flow Management: With real-time visibility into outstanding invoices and payment dates, AP automation allows companies to optimize their cash flow. Companies can take advantage of early payment discounts and avoid late payment penalties, thereby improving their bottom line.
  • Decreased Rogue Spend: AP automation controls maverick spending by enforcing corporate policies and approval workflows. It also improves spend visibility, enabling companies to identify and mitigate rogue expenditures more effectively.
  • Improved Supplier Relationships: Timely payments and transparent communication foster healthier supplier relationships. This enhances supply chain efficiency and opens up opportunities for negotiation and collaboration.

The Powerhouse Duo: SAP Ariba Buying and Invoicing and Premikati

While the benefits of AP automation are clear, the choice of software and its implementation process is crucial.

SAP Ariba Buying and Invoicing is a robust solution offering comprehensive AP automation capabilities. It streamlines end-to-end procure-to-pay processes, enhances visibility into company-wide spending, and drives compliance and control across the invoice management process.

Yet, the success of any AP automation initiative is about more than just the software. It’s about how effectively the software is implemented and integrated with your existing systems and processes. This is where Premikati offers rapid implementation and deployment services that ensure a smooth and efficient transition to automated AP processes.

Premikati’s expertise in SAP Ariba implementation reduces the time-to-value, allowing companies to experience the benefits of AP automation sooner rather than later. Their robust training and support ensure that your team is equipped to leverage the software’s full potential.

AP automation is a transformative strategy that can significantly improve your business’s operational efficiency, financial health, and competitive edge. With SAP Ariba Buying and Invoicing and Premikati’s deployment services, your business is well-positioned to navigate the AP automation journey successfully.

Connect with us today to talk to our team.

Feb 16
Supply Chain Management SAP Ariba Premikati

Tips for Successful Supply Chain Management

By Procurement No Comments

Sourcing and supply chain management go hand in hand.

Successful supply chain management is the backbone behind most successful businesses. If we had any doubt, the last three years made it clear.

Here are four pointers to help you ensure the success of your supply chain and how you can manage your relationships for success:

1. Leverage New Technologies

Today’s supply chain industry is brimming with new technologies and it has never been easier to get the most out of your supply chain using tools such as:

I. Artificial intelligence and predictive analytics to aid in inventory forecasting.

II. Procurement applications such as SAP Ariba SLP.  This aids in quality control, supplier scorecards, supplier management and cost savings during procurement.

III. Digital supply chain twins, which improve transparency and decision-making in the supply chain.

2. Constant Evaluation of Sourcing Strategies and Suppliers

The focal point of any supply chain management is sourcing. If done incorrectly, it could spell the end of many supply chains.

Take, for example, this Gartner study.

74% of companies that constantly reviewed and developed their sourcing strategies increased their productivity and savings significantly.

It really is a no-brainer.

To get the most out of your sourcing, figure out which strategies work best for your supply chain and focus on them. You should concentrate on the suppliers’ credibility, capacity, and shared goals.

3. Employee Development

Employees, like other aspects of the business, make significant contributions to supply chain management. In a nutshell, they are the foundation of any organization.

It only makes sense to invest in their advancement. Especially if you want your supply chain management to succeed.

When it comes to training their employees, most businesses are afraid. They are concerned that they will leave and join their competitors. It’s understandable.

But wouldn’t it be more dangerous not to train them? And then watch them wreak havoc on the supply chain and overall business objectives?

Employee competencies are improved through training and development.

4. Enjoy the Competition

Competition is the backbone of any thriving industry. To see success in your supply chain, you must learn to enjoy the competition. 

 Why? The simple answer is competition breeds innovation. And innovation is the secret weapon of any successful business. 

 With competition, you can isolate a competitive edge, allowing you to better cater to your customer’s needs.  

 It also has benefits like improved customer service and constant business development.  

 

What are the key issues you encounter in your supply chain organization?

 

For procurement and supply chain management consultations from the global leaders in Ariba solutions please visit us at www.premikati.com.

Oct 05
Contract Management

5 Ways Legal Teams Gain A Boost From Contract Management Software

By Procurement, Procurement Managed Services No Comments

Navigating procurement contracts as a legal professional and feel like walking through a minefield, especially if your company is still relying on outdated procurement practices. A good, digital contract management system such as SAP Ariba causes risk to plummet using mitigation techniques like full, auditable visibility and alerts about potential risk factors. It also saves legal departments a lot of time reviewing almost-identical contracts. Here are a few reasons contract management software is critical to modern legal professionals working in the procurement:

Verifiably Maintain Compliance

Compliance is non-negotiable within your organization, but verifying and maintaining compliance can seem like an insurmountable task. Proper contract management using SAP Ariba software offers legal teams many compliance protections including clear visibility into the entire contract lifecycle, alerts for nonstandard contract agreements, and a full audit trail along the way. 

External compliance such as rules put in place from regulatory bodies like state and local governments can be handled within the system as well as internal compliance concerns such as quality expectations. If any issues arise, they can be quickly addressed to avoid any further risk while still fostering a trusting relationship with your suppliers. 

Gain Unprecedented Visibility Throughout The Entire Contract Lifecycle

On the point of visibility, contract management extends from the initiation phase through to negotiation and onward into contract renewal. Being able to see the entire lifecycle can help legal professionals spot risks before they become an issue, so they can be addressed with urgency.

Traceable Esignatures

Esignatures have put pens on the backburner. Not only is the digital signature completed online without the need for paper mail or tedious faxing, it is traceable in ways that a pen signature cannot be.  Esignatures also offer a boost to contract accuracy because it guides suppliers through each step of the signing process (sign here, initial here, etc.) so your legal team no longer has to deal with missed steps and incorrectly managed paperwork. 

Additionally, esignature platforms offer reminders for suppliers who take a bit longer to add their signature. This helps ensure that all contracts are signed fully to avoid any legal snafus that can arise from liabilities caused by incomplete contracts  (which are ,effectively, no contracts.) 

Controlled, Automated Processes You Can Rely On

Using templates and clause libraries, procurement teams are able to put together their own contracts using pre-approved language. In the event that a nonstandard  contract needs to be created, a notification for review will be sent. This helps ensure that all contracts are legally admissible without consuming focus and massive swaths of time. Legal professionals can use their time providing greater value for the company than constantly reviewing nearly-indentical contracts. 

Reduce Risk With Performance Insights 

Whenever supplier deliveries aren’t meeting standards, or if a supplier chooses to utilize non-compliant tactics, the issue must be dealt with swiftly in order to avoid as much damage as possible.  The SAP Ariba contract management system makes it easy to track performance and view the information from a centralized dashboard. Intervening early can help salvage supplier relationships as well as reduce overall legal risks associated with defective or non-compliant parts.

If you want to see what we can do for you with our SAP Ariba-backed contract management system, reach out to us today. 

About Premikati

Premikati is a woman-owned business of procurement experts providing best-in-class software to maximize your company’s ROI.  

Our award-winning team has a 100% success rate implementing on-time and on-budget, due to our agility, leanness, operational experience, and the ability to tailor the transformation process from C-level to end user. (For more information, visit www.premikati.com)

Feb 18
procurement automation for smbs

Procurement Automation: Best Bet for Growth for SMBs

By Procurement No Comments

Procurement Automation: Your Best Bet for Growth

Is there a way to optimize your procurement processes without having to make a massive investment in IT? Can you eliminate manual processes and their associated errors? Is there a way to eliminate expensive invoice processing?

It goes without saying that procurement processes can involve a wide variety of third-party vendors such as business partners and consultants, along with legal, supply chain management, and various department needs. Yet, data can be difficult to locate and the success of a procurement process may simply revolve around the fact that no one complained – yet.

Unfortunately, many SMBs spend a large portion of their sales revenue on procurement. Nonetheless, simple enhancements – such as automation – to the procurement process can perform the double duty of reducing costs and boosting productivity.

For SMBs, with their limited resources, the focus is often on overarching operations as opposed to specific procurement business functions. But, when you can empower your procurement team with an automated tool, then you can improve supplier relationships and make the right purchases for your business – on a more consistent basis. Further, all parties are satisfied.

When you utilize automated procurement, you can prevent your teams from engaging in trivial tasks so that they have more time to focus on their core functions and responsibilities. Also, you decrease human error.

Certainly, these are all specific reasons why many SMBs are opting for automating procurement, but there are many other advantages as well. Keep reading to learn more. 

Get Out of the Time Rut

Within the procurement cycle, or purchasing cycle, there are several stages such as research, bidding, vendor selection, negotiations, and approval. Depending on the current processes you already have in place, this can take much more time than necessary.

Why not speed up your processes with procurement automation? You could reduce the cycle by days, or even weeks. If you’re interested in adopting lean principles, automation would be the route to take. 

Plus, there are huge amounts of paperwork that needs management. In contrast, procurement automation can save time by transitioning documents from paper to digital. Not only do you save on paper and physical storage costs, but you inherently speed up all your cycles and processes.

Get Your Supplier Relationships on the Same Page

For the health of your SMB, it is vital to have strong supplier relationships. Although, this can be difficult in a highly competitive environment. To get there, you need true transparency. The good news is automation enables real-time interaction and order tracking. In addition, an automated system lets your suppliers respond more quickly and your company can select a supplier more quickly. Moreover, the process is transparent for all parties involved which means a much faster resolution process in the event of a complaint or misunderstanding. It is a win-win situation for all.

Monitor Every Interaction

When your company opens up a bidding war, this means you increase your chances of finding a vendor who can meet your budget. At the same time, it can get quite complicated to manage every interaction with all of your potential vendors. Further, no one likes filtering through hundreds of email messages trying to find the most recent interaction. Unquestionably, this is a scenario where mistakes can happen and messages will get missed.

With an automated procurement tool, you can quickly access all associated documents and RFP responses. In fact, you can even monitor every single interaction in real time.

Enjoy More Control

SMBs often face the daunting challenge of limited visibility during one-or-many stages of the procurement process. Invariably, low visibility can become even more prevalent during indirect procurement. One of the quickest ways to overcome this hurdle is with an automated procurement tool.

It’s imperative to have a visual representation of how much you’re spending on every purchase. Many SMBs have finite resources which means it would be quite beneficial to determine where you could cut back on expenditures. As a result, you feel more control over your budget and can improve your revenue outlook.

How Can You Tell if Your Procurement Processes are Ready for Automation?

Part of the decision-making process around an automated procurement tool is knowing which of your tasks are ready to be automated. So then, it is critical to execute a thorough assessment – and analysis – of your current processes and which are redundant/repeatable where automation can take over to save both time and money.

For instance, if your company requires a lot of legal input during the buying process, then you could automate this portion by utilizing pre-approved negotiations so that your legal team can focus on higher-level tasks.

There isn’t any reason why the SMB procurement process should not replicate the enterprise in terms of purchasing, employee training, and automation. SMBs want to grow, and automated buying practices help to provide transparency, facilitate tracking, offer convenient reporting, and most importantly, assist in managing costs to set the stage for expansion.

Final Thought

Searching for a comprehensive automated procurement tool to effectively manage your processes? When SMBs streamline how they purchase goods and services, they create more value and become an organization that vendors – and customers – enjoy.

Learn how an automated system can streamline your procurement process – contact Premikati today for a free consultation!

 

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