Companies are increasingly investing in digital solutions to drive efficiencies and financial savings across every area in their business. One area that these solutions deliver significant financial savings is in procurement with the solutions often recording projected and realised savings delivered by both cost reduction and cost avoidance measured against actual baseline spend.
As well as saving money, these digital procurement solutions are also delivering substantial time efficiency savings across every part of the procurement cycle.
In sourcing, following a previously set-up proven process gives transparency and control over every activity and allows easy collaboration and a central repository for all current and historic events. This saves having to re-create the process every time, means that colleagues don’t waste time trying to find records and that there is an established audit trail.
In contract management, having an easily accessible contract repository means that time is not wasted searching for contract details and documents. Having a clear summary and automatic alerts of notice periods and contract end dates means that work can be prioritised and properly resourced rather than done on the back foot at the last minute. Having a permanent record of every contract either as active or archived means that time is saved not repeating work that has already been done before.
Supplier management is like contract management, delivering valuable time savings through the supplier repository and alerts. In addition, being on top of supplier performance and compliance means that in many cases issues can be avoided that would have cost time as well as money to resolve.
Measuring the time saving efficiencies delivered by using a procurement software varies from company to company, however a simple way to calculate this is to use the following calculation:
(Average Salary of employee / Average number of days worked) / Numbers of hours worked per day
As an example:
(Salary of £30,000 / 220 days) / 8 hours per day = £17 per hour
Therefore, for every employee hour that is saved by using a procurement software the company is at least £17 better off as the hour can be spent on more productive activities that may generate further income or savings.
For many companies, especially larger ones, who have more resources there are different digital procurement solutions available. For those smaller companies there is one digital procurement solution that has been designed specifically for SMEs called oboloo. oboloo is an intuitive and simple self-service platform that gives full visibility and control over all sourcing, contract, supplier and savings management. oboloo enables companies to be supplier smart. To learn more please visit www.oboloo.com.