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Procurement Solutions for Financial Managers

18 Sep 2015 - Mickey Farrance

Procurement is a strategic process for an organization, not only for the organization’s day‐to‐day livelihood, but also for its competitive advantage.

Supply Chain IQ conducted a survey to understand the challenges procurement professionals face, as well as the major challenges today’s economic climate presents. The survey revealed the top three concerns to be: managing supplier relationships, price volatility of commodities, and managing expectations of stakeholders. Meanwhile, the current economic climate has brought challenges across the board in terms of the competitive landscape, cost volatility of raw materials, and general volatility of the economy. A Business Process Management (BPM) solution that enables procurement managers to optimize their processes and includes reporting and dashboards of key performance indicators (KPIs) is key to overcome these challenges.

 

  • The following are some scenarios where the procurement process can make or break an organization’s business:
  • The CFO does not understand precisely when money will be taken out of the bank or the financial system. Even though the CFO understands how everything should work, what if, for example, a bank holiday in a foreign country delays a critical money transfer for a procurement purchase?
  • The CFO may struggle with one of the organization’s top scientists who is trying to procure something that is seemingly not relevant to the bottom line of the business. Could that acquisition lead to expenses that could bankrupt the company?
  • In a perfect world, employees will look for the best possible supplier with the best possible terms, use only what they deem to be necessary, and then post the expense to the balance sheet. But what overall corporate constraints might the employee be missing in the procurement process?
  • Take two competing firms, one with better than industry average efficiency of the Procurement Process and the other with the lower than the industry average. Everything is the same except the Procurement Process. Could the Procurement Process serve as the strategic, competitive advantage to become the dominant player? When considering historical examples like Amazon.com, Dell, and Wal‐Mart, it seems to be the case.

 

This paper explores how BonitaSoft BPM solutions can make the Procurement Process a strategic tool for your own organization’s clear competitive advantage.

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