Unlocking the full potential of Procurement through Integration
Integration can no longer be a peripheral factor for companies to decide the procurement solution they opt for, it is vital for an efficient and top performing procurement function. Procurement’s rising stature and increased docket of responsibilities means that it cannot function in silos, and needs seamless integration and interfacing with most systems.
According to The Deloitte Global CPO Survey 2018, “46% of the procurement leaders believe lack of data integration is the most important barrier for the effective application of digital technology in procurement”. Based on this statement, integration should be a core component of the Procurement strategies.
Business Need For Integrated Procurement Solutions
A Spend Matters Research states that the increasing demand for Integration in Procurement is indicative of the following business needs:
- Flexibility: In today’s environment that is continuously in a state of flux, procurement systems should be able to integrate with newer tools and changing business environment’s quickly
- Control: Today, companies value and strive for greater control, in an effort to increase factors like spend under management and compliance. Hence, the system should have the capacity to influence and control spending decision
- Visibility: It is extremely vital to have complete visibility into all spending activities and decisions taken. Greater visibility for a business means they will be able to better anticipate cash flow and working capital requirements
- Forecasting: The data and intelligence an integrated procurement tool can provide can be used for budgetary forecasting, building and analyzing various scenarios.
Now, with a vast range of procurement solution providers and varied offerings that are available to chose from, the discussion mostly boils down to “Should we go for a unified procurement solution with comprehensive and integrated Source-to-Pay tools or a standalone tool for each of our requirements”. Here are a few pointers that might help you decide:
- Better Visibility : Organizations today comprise of various departments and branches that are spread across the globe, hence it becomes very important to be able to access accurate data pertaining to sourcing, contracts and their terms, supplier information etc. A unified procurement software.
- Higher User Adoption and Compliance: An integrated Source-To-Pay system allows the user to access any and all information on a single system without having to go through or log in to various applications. An integrated system serves as a single source of all information which makes it easy and less time consuming than navigating through multiple systems.
- Lower Cost of Implementation: Standalone solutions may seem to be a cost-effective option, it isn’t always so. The Total Cost of Ownership (TCO) in such cases is much higher, this includes the separate trainings, implementation and maintenance required for each standalone module.
- Seamless Integration: Apart from what has been mentioned above, the major drawback of having standalone tools is ensuring that the various separate systems to communicate and exchange data seamlessly. In case of a unified source-to-pay system, the various modules are inherently integrated together ensuring end-to-end communication and smooth flow of data across systems.