Cloud applications are changing the procurement area in many companies.
Approximately 82% of procurement organizations reported undergoing change. Technology, along with the role of procurement in the supply chain, is behind this big leap among procurement organizations. It’s changing both how companies view procurement and how procurement views supply chain management.
Mindover Software offers a free recorded webinar, Automating Business Processes with ERP Software, to help you better understand the many potential processes in your company that can benefit from automation. From billing to supply chain management, automation saves time and manpower. Watch the webinar today.
The Role of Procurement
The role of procurement varies according to the size of the company. In larger companies, procurement may be responsible for as much as one-third of the entire business function.
As companies grow larger and more complex, they deal with more third-party vendors. These vendors may provide services or items that are part of the supply chain. A separate procurement department may need to be established to source, hire, and manage these third-party vendors.
The Impact of Technology on Procurement and Supply Chain Management
Technology plays an important role in the shift of how procurement is viewed within many companies. Technology is making it easier and faster to manage the supply chain.
Enterprise resource systems, business intelligence, and other accounting and financial management systems have transformed the amount and quality of data available. Now, with enhanced reports, real-time analytics, and updates from throughout the supply chain, companies can use that knowledge to enhance their operations.
With accurate and timely information flowing throughout the company thanks to these technological innovations, procurement can use data to inform decisions. The procurement department is now better able to respond to changing situations thanks to the availability of data.
Cloud Applications Makes It Easier to Use Big Data
Yet another change that is making it easier for companies to manage and use big data is the cloud. Cloud applications provide improved functionality at a fraction of the cost of older, site-based licenses. More data is no problem for cloud-based systems which can expand to accommodate additional data, users, or sites quite easily.
Using data for everything from budgeting to forecasting improves every aspect of your business. Data can be used to reduce costs, improve sales, and enhance productivity. This applies to procurement and supply chain management as well as to all other areas of your company.
The Internet of Things (IoT) and Its Impact on Supply Chain Management
The IoT refers to the ability to add internet-linked devices to vehicles, pallets, and other objects. Data can be sent from the object to the internet and through a central resource such as your ERP system. Companies transporting perishable materials may use the IoT to monitor temperature fluctuations during transport. Manufacturers use geo targeting to get up to the minute information on the location of raw materials or customer orders.
The implications of using the IoT for manufacturing are just sinking in now as companies explore the many possible applications of this emerging technology. IoT data added to a company’s system lends itself to more reports, better analytics, and additional insights that can lead to profitable businesses.
Procurement Takes Center Stage
Procurement used to be relegated to a back-office function, a department that handled acquiring items and sourcing vendors. Not anymore.
Companies now rely upon the procurement department to find the best materials, vendors, and equipment at the lowest cost. To do so, they need to invest in the transformation of the procurement department. A sound, well-managed procurement department, fueled by data and analytics, can truly add to a businesses’ bottom line.
Mindover Software provides business software and solutions to companies big and small. Cloud applications from Acumatica and Sage provide companies of all sizes with powerful data management and business insights. We welcome your inquiry and can assist you with your cloud applications, ERP, BI, and warehouse management software needs. Contact us.