E-sourcing your way to success | Software | Computers

Effective supply chain management require critical operations such as strategic sourcing, category expertise, negotiation management and procurement execution. For this to be a wild success, the analysts must have easy access to spend data which can be sorted, organised and analysed. When timely access to complete, accurate, and detailed spend data can be achieved, a company can gain indefinite insight into their spending patterns, policy compliance, performance rating, inventory stock among others. Of late, companies are realising the importance of increasing their bottom line. As a result, strategies are being adopted to increase the efficiency of the processes in the organization, particularly spend management. One of the biggest steps that companies have taken towards achieving this task is fully automating the entire spend management process. This has inadvertently led to the automation of the sourcing process, now known as e-sourcing. This article is aimed to introduce the reader to e-sourcing.

e-sourcing is sourcing on a web based platform and it was designed in order to facilitate tenders and hold negotiations in a faster, more efficient and more transparent fashion. It has turned out to be a profitable business tool for both buyers and suppliers. By adopting e-sourcing, companies save a lot of time and effort by completely avoiding time spent on travelling back and forth. It provides a simple, easy to use interface where data can be filled and submitted online. It results in faster evaluation process and reduces decision making time. Through e-sourcing, suppliers can compete in a global arena and buyers can choose quality products at nominal costs owing to increased competition. Since all the requirements can be accessed through a click of a button there is lesser chance for errors. Additionally, since the program is web based, all the departments in the company can gain access to the application. For instance, if an RFP is being prepared to obtain raw materials for a new project, then all the teams and departments involved in the project can collaboratively contribute to the RFP.

The aim of e-sourcing is to bring the focus of the company to the price and the quality of the product and not the supplier. Since a major percent of the company’s revenue goes in purchasing raw materials, it is vital to ensure that high quality raw materials are obtained at the lowest possible price.

In e-sourcing, the process for request for information, request for quotation, request for proposal, and request for solution is all done online. As a result the company saves on a lot of paperwork. Since every company is now focusing on reducing its paper consumption, e-sourcing greatly assists in this effort. By obtaining all the supplier information on a single platform, it also becomes easier for the sourcing team to sort and organise the suppliers, compare their performance, their histories, their delivery schedule, the quality of the products and other factors. This feature helps the company in choosing the ideal supplier for the task.

By using e-sourcing tools, the company can develop best practices. It can assess which cases have been the most beneficial to the company and can implement the strategy in its future practices. It can also help the company analyse situations where things go wrong so that such events can be avoided in the future. But to develop these best practices, companies have to define and develop procurement strategies for obtaining materials, take time to prequalify suppliers in order to reduce the time taken to make the purchase, draw up contracts and maintain them for future use, develop strong relationships with the suppliers etc.

An e-sourcing software can assist the company in most of these tasks, but it cannot replace the initiative taken by the company to establish these practices and following through with them.

Enaviya provides Expense Management Software, Travel & Expense and Spend Management

via freearticles.mohul.com