If you’re reading this, your team is likely taking the plunge and investing in procurement software. You might also be the primary advocate, and you’re looking to build a business case for a new procurement management system. Either way, you’re in the right place.
As millennials fill the industry, the demand for improved sourcing technology is higher than ever. But beginning the search can be daunting.
This post will explain how to find a procurement software solution that will solve your organization’s key challenges. Keep reading for tips on a faster, easier, evaluation process.
The most important question to ask as you begin your search is, what problems are you trying to solve? The answer should guide your entire evaluation process. For instance, the following are common areas that can be improved with procurement automation.
Ask your team where the most time is wasted. Is it sourcing? Supplier selection? Invoicing? Find out which tasks are the most tedious and consume the most hours. Determine what specifically isn't working about current software and systems.
Procurement software solution: this will vary according to the task. Could be anything from an RFP tool, invoicing system, or a project management platform.
Are you unable to track all your key metrics? Do you need better spend transparency? Do you have to depend on suppliers to provide spend information?
Procurement software solution: if so, the answer is a spend analytics software. Look for one that showcases total procurement expenditures across each location and category
Ask your team how difficult it is to find savings opportunities. Do they know which categories can be improved, and by how much?
Procurement software solution: spend management tools can automatically highlight these opportunities for you.
Then, dig deeper by asking the following questions. Remember to include all the relevant parties in the conversation. Especially finance and legal if their purchase sign off is needed.
This conversation should give you a decent idea of what to look for in your procurement software. But bear in mind, there are several kinds of procurement solutions on the market. So you may need more than one tool, or a hybrid system, to get everything you need.
As you discuss all this, prioritize which concerns are of the highest importance. Identify your “deal breakers,” aka what you must have for the new tool to be considered a success.
Once you have a clear sense of priorities, your next step is to research. Before you schedule a single demo or issue an RFI/RFQ, research the market. Who are the key players, what are their reviews, how do the feature offerings compare?
Doing the prep work will make your selection process as fast and efficient as possible. You'll also be able to ask much more informed and intelligent questions.
Use this research to create your supplier shortlist. (The keyword being short). Then send your shortlist an RFI or RFQ with your “dealbreaker” questions. Keep it brief and sweet, think seven questions or less. Your team will thank you for keeping it simple and saving them an evaluation headache.
As you schedule software walkthroughs, make sure all your critical stakeholders will be available to attend. Or at least, that you can get a demo recording. Again, these simple measures will massively speed up the search process.
Below are a few suggested questions to ask as you consider your options.
Most importantly, don’t get stuck on price. Instead, consider the overall value. If a tool can save you hundreds of hours, or provide strategic insights, how much is that worth?
Finally, circle back to the big questions. Ask, will this software solve our critical problems? Will it help us reduce risks and increase savings? What kind of crucial insights will it provide?
You would be shocked to learn how many procurement teams spend massive sums of money on software only to never use it. Take it from this writer, who worked in the procurement SaaS industry for years, it happens all the time.
It may sound obvious, but it doesn’t matter how great your new tool is if no one leverages it. Below are practical tips for getting the buy-in and ROI you deserve.
While it may sound like overkill, you won’t see any return from your investment, until your stakeholders learn how to leverage it properly.
Procurement digital transformation talk is cheap. But using technology to increase the value of your function, proves you're a true procurement leader and earns your seat at the table.
