CPO Rising 2017 Summit Perspectives – Ten Ways Real-Time Data Transforms Procurement to Deliver Tremendous Savings and Value, from Aquiire
This year’s CPO Rising 2017 Summit featured exciting roundtable sessions where attendees got to exchange ideas and talk about innovative strategies to help improve the performance of their procurement department. In this article series, we look to our roundtable hosts, who captured thoughts and insights from the roundtable sessions they each hosted at the Summit.
Today we have a guest post from Aquiire, which hosted the “Comply or Compare? Procurement Doctrine for the Year Ahead” roundtable at the Summit. This exciting roundtable discussion explored ways to reconcile differences between how we shop in our personal lives (comparison shopping) with how we purchase for our organizations (compliance shopping). It also explored how technology can play a role in bringing effective solutions to B2B shopping.
There are numerous reports that cite the value and savings digital automation offers procurement organizations. At Aquiire, we have proven that even more “white space” savings and value can be achieved by adopting real-time data and a competitive B2B e-commerce marketplace as part of a larger eProcurement digital strategy. Here are 10 ways we have found real-time eProcurement matters:
- Establishes a Single B2B Marketplace Where All Catalogs Are Searchable and ‘Shoppable’
With real-time search capabilities, the latest negotiated product information and pricing is brought together in one set of results (universal search), regardless of whether supplier catalogs are hosted inside or outside of the organization. Users no longer need to visit separate punchout catalogs (supplier websites) to search for the products they need. Instead, all data is “punched IN” so users can comparison shop all the options available from contracted suppliers in one consolidated internal marketplace.
- Provides Side-by-Side Comparison with Up-to-the-Minute Prices
Most eProcurement systems require users to “punch out” to supplier e-commerce websites one-at-a-time to find products they are seeking without a convenient way to compare current market pricing from multiple suppliers. A real-time comparison shopping experience functions much more efficiently by allowing the user to quickly and easily purchase the products they require with a consumer-like shopping experience and without ever leaving the organization’s private marketplace.
- Automatically Organizes Product Information for Quick and Easy Shopping
A unique function of real-time search is the ability to integrate product descriptions and other unstructured data from the search results, and automatically group them into a highly visual display. This gives shoppers the ability to drill down to deeper product descriptions, images and .pdf manuals not originally designed into the catalog search structure.
- Presents Buying Options the Procurement Way
Real-time guided buying is in stark contrast to punchout (e-commerce) supplier websites, which use the latest behavioral science and marketing techniques to upsell and cross-sell for higher-cost purchases from shoppers. With real-time guided buying functionality, procurement has the flexibility to decide how items are displayed—by SKU, category, department, location—and presented in the real-time search results, while still providing the consumer-like shopping experience they desire.
- Maintains Procurement Know-How During Change Management
Change management is an inevitability in any organization. With the real-time guided buying rules in place, new employees—procurement administrators, accounts payable, IT and individual users—are consistently compliant to organizational purchasing procedures.
- Secures the Best Deals in the Market
Even with the best negotiated contracts, any one vendor will not be the best choice at every given moment in time. Real-time product/pricing data and alternative supplier choices for end users are essential to deliver significant, untapped savings on indirect and long-tail spend.
- Instantly Validates Negotiated Supplier Pricing, Products and Availability
A well-negotiated contract means nothing if the discounted prices are not reflected at the time of purchase. The most typical discrepancies occur because of price and product “creep.” Typically, expensive and time-consuming audit processes are necessary to identify and recapture these transactional errors. Real-time purchase data allows users and administrators to discover off-contract pricing and products before the purchase is completed, rather than months after an invoice has been paid.
- Enables Procurement to Negotiate Better Supplier Pricing
Real-time data can drive substantial savings by continually tracking the organization’s purchasing history and supplying useful analytics to ascertain the competitiveness of current negotiated supplier pricing in comparison to alternate supplier prices at the point of purchase. By maintaining historical pricing data (for every SKU) and presenting the information in comprehensive reports, sourcing teams have the actionable information they need to better renegotiate contracts.
- Improves Supplier Relationship Management and Satisfaction
Your sales channel becomes more attractive to suppliers with advanced real-time capabilities. As user adoption and purchasing increases through the marketplace, supplier sales will increase—even in a competitive shopping environment. This leads to contract negotiations that benefit both procurement and suppliers, increasing the value of the relationship and driving additional cost savings.
- Streamlines Purchase Order Automation
Like many processes, the quality of the input can dramatically affect performance. Having real-time price validation of items before completing an order transaction removes potential order issues downstream in the procure-to-pay process and increases the speed of processing. Reducing manual labor costs on purchase order exceptions offers remarkable savings opportunities.
For more information, download the complete white paper: The Top Ten Ways Real-Time eProcurement Matters.